Robert M. Travisano, Member of the Firm in the Litigation & Business Disputes practice, in the firm’s Newark office, was quoted in Pallet Enterprise, in “Cyber Security: How to Counter Fraud in a Digital World,” by Phillip M. Perry.
Following is an excerpt:
Businesses face a growing risk of financial loss from fraudulent Internet transactions. Learn the right internal operating procedures to limit risk.
When the controller of a California business received an email from the CEO requesting an immediate wire transfer to a vendor, the transaction seemed routine. Only after the money was sent was it discovered that the vendor was not due such a payment. And worse, the funds had not been received.
An investigation revealed that the sender of the request had been a thief using an email address misleadingly similar to the targeted company’s top executive. The supplied banking credentials were actually those of the crook’s account in China. Acting quickly, the controller called the overseas bank to see if the payment could be canceled. What he heard allowed him to breathe a sigh of relief: Because the funds had arrived on a Chinese bank holiday they had not yet been credited to the thief’s account. The company was able to recover its funds.
While our opening story has a happy ending, most businesses targeted by so-called Business Email Compromise (BEC) fraud are not so lucky. Of the 11% of respondents in a recent survey from consulting firm AP Now reported losing money to such fraud, only 3.2% recovered all the stolen funds. The fraud is increasing rapidly as thieves have learned to cleverly disguise C-level executives’ identities. …
Reports from the FBI, the IRS and other agencies show that cyber fraud poses a growing threat to businesses. While many thieves want money, others want data such as company marketing plans or customer information for identity theft. Losing control of the latter can be especially costly. …
Fueling the rise in cyber fraud is the growing digitalization of business transactions, a long-term trend given further impetus by a greater reliance on electronic communications during the Covid-19 pandemic. “Flaws in firewalls and Virtual Private Networks (VPNs), as well as in videoconferencing systems have exposed more businesses to incursions,” stated Robert M. Travisano, an attorney in the litigation practice of Epstein Becker Green (ebglaw.com). The rapid expansion of devices on the typical employer’s computer network has given cyber actors still more opportunities.