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Banking fraud – tips on how to avoid becoming a victim

Shipbrokers and agents are among those most at risk of exposure to fraud in the shipping industry, according to professional indemnity insurers International Transport Intermediaries Club (ITIC).

In the latest issue of its Claims Review, ITIC cites the case of a ship broker who received an emailed freight invoice from an owner for $120 000. The bank account detailed in the invoice was the same as that previously used by the owner but, several hours later, a further email was received, apparently from the owner, advising a change to the bank account details because the original bank account was ‘no longer available to receive payment due to an internal audit.’ 

The message was not in fact from the genuine owner but from a very similar email address created by a fraudster who had also provided a fake account registration form. The broker failed to notice the change in the email address, and it was only after the owner enquired about the whereabouts of the freight that the scam was discovered. The charterer had to pay the freight again and claimed from the broker for negligence. The broker reimbursed the charterer and ITIC reimbursed the broker.

In another incident, a ship agent received an email purportedly from its principal explaining that the principal’s bank details had changed and that funds were to be sent to a new bank account. The new bank account had no apparent link to the principal, but the agent duly transferred $53 000 into the new bank account. The principal, however, did not receive the funds because the agent had paid the money into the wrong account, failing to notice that the email address notifying the change of bank account was slightly different to the correct email address of its principal. ITIC duly reimbursed the agent for the full amount. ITIC says it continues to see a large number of such frauds. While most of the victims and intended victims have been ship brokers and ship agents, it has also received reports from members carrying out a wide range of other activities.

ITIC said anyone making a payment could be the target of fraudsters, and warned that any message purporting to change bank account details should be regarded with suspicion. It has urged its members when transferring funds to use the telephone to check account details with a trusted representative at the recipient’s office. Simple checks, it says, will defeat the fraudsters.

 

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