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28 April 2015

Email Fraud Targeting Housing Associations

Email Fraud Targeting Housing Associations
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Housing Associations are increasingly being targeted by criminals looking to commit fraud. This article sets out the details of one particular scheme that we have seen several times this year.

This attempted fraud tries to persuade an association’s finance department or the Finance Director to release sensitive information or even transfer funds on the instructions of an email purportedly from the association’s Chief Executive.

It seems that fraudsters have found a way to clone email addresses so that, on the face of things, they seem to be genuine. Upon closer investigation however, it appears the fake e-mails were sent from a Gmail account.

We have had reports of this from several housing associations so please be vigilant. Thankfully most people seem to have realised that it was an attempted fraud but we believe that one association released a five figure sum.

Key indicators that the emails were not genuine included the tone and choice of words used. Several of the people we have spoken to had their suspicions raised by the way the e-mail was worded, saying that it did not match the usual style of communication of the Chief Executive.

On another occasion the e-mail was sent when the Chief Executive was on annual leave which naturally raised suspicion.

The most fortunate Finance Director received the fraudulent e-mail whilst in a meeting with the genuine Chief Executive so they were able to immediately identify the deception.

Any kind of wide scale attempted fraud like this is likely to be unsophisticated but the fraudsters are only expecting a very small strike rate. If you receive an odd email from a senior colleague asking you to transfer funds then check it is a genuine request.

The best way to avoid falling victim to any such fraud is to ensure that you always follow your procedures and always check the authenticity of any payment request using the contact details you have on file – not those on the request itself.

For information on how to insure against fraud please contact your Arthur J. Gallagher, Housing representative.

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