Here is one of the biggest uninsured types of loss … and it can happen to you!
Fraudsters are tapping into company email systems to see “who tells who” to regularly wire money.
Then the fraudsters impersonate a vendor and send an email to the CFO or controller which contains a change to the usual wire instructions.
Typically the fraudsters instruct their victims to wire funds to a new – and often foreign, bank.
Once the wire is done, your money is lost forever with rare exception.
Such a loss – “Larceny by Trick” or being duped out of one’s money, is not covered by most Crime insurance.
Here is a recent loss:
Fraudsters got into the email system of a large show company. They sent an email to a branch office which handled their own vendor payments purporting to be from a legitimate vendor. The email contained instructions to send payment to a new bank. The show company sent nearly $100,000 to the fraudster’s bank! The money was lost. The show company’s bank was not at fault because it simply followed instructions. Initially the show company wanted to blame the bank but realized the bank was not a victim. The company was. The show company lost the money sent to the wrong bank; plus, they still had to pay the real vendor
Buttine Tradeshow Insurance specializes in insurance for the tradeshow and exhibition industries; we work with clients to help make sure they have procedures in place to prevent this kind of loss.
There is now insurance for Larceny by Trick but the coverage requires procedures that once in place will almost certainly eliminate any chance of a loss.
What are the procedures? … Call the vendor and check to see if any charge to a wire instruction is valid.
Good procedures give great protection.
For additional information, call Jack Buttine at 212-697-1010 x 21 or jmb@buttine.com ; www.buttine.com
Buttine Tradeshow Insurance has been in the tradeshow and exhibition business for over 30 years. We protect your assets and your events.
