Fake Invoice: How to Protect Your Business

SRUSHTI SHAH

10 min

·

October 6, 2023

Imagine the situation – an invoice arrives demanding immediate payment, but you don’t recall ordering anything from the company in question; this is just a taste of the shady world of fake invoice scams, and it’s costing businesses millions of dollars yearly. 

This comprehensive guide will uncover the secrets behind these scams, help you spot the warning signs, and share tips on what to do if your business is targeted.

What is Fake Invoice?

Fake invoices are tricky, misleading bills – bills for things you never bought. Sadly, scammers use them to trick you and go after your hard-earned money; and the worst part is that they’re getting better at this all the time.

It’s deeply unsettling that these fraudsters are tirelessly honing their strategies, rendering it progressively harder to recognize and defend oneself from becoming prey to their deceptive ploys. Consequently, the importance of staying alert and keeping up to date with the most recent developments in this field is a key part of securing your financial stability.

How Much Damage Do They Make?

In the U.S., the problem is vast. People lost about $30 million in 2019. All that money went into scams; a heap of tricky scams. Plus, remember, that’s in just one year. 

In Australia, businesses and individuals have also been victimized; in 2020 alone, AUD 7 million vanished. How did it disappear? Invoice scams. The enormity of this issue is clear – it’s a worldwide problem, and it has become impossible to overlook.

Tip: Be cautious of double invoicing to avoid financial errors and confusion.

This Scam is Evolving

Unfortunately, the saga continues, as scammers are becoming increasingly adept, finding and exploiting ever more loopholes. Fraud schemes in general are becoming broader and more complex; one thing this means for us is that we need to be on high alert. 

5 Tips, How to Identify a Fake Invoice?

Here are some useful steps you can use to spot fake invoices:

Step 1: Spell Check

Always be patient with your details. Fake invoices might pop up, and they usually show spelling errors. They might misspell your name or address, and even one small mistake can be fishy. 

If you want to find out what a professional-looking invoice looks like, read this article.

Step 2: Mysterious Items Beg Questions

Did you find unrecognizable charges on your bill, items you didn’t buy, or more items than you allowed? If yes, these might point to a phony invoice. Scammers aim to mix you up, as this helps them hide these odd transactions amid confusion.

Step 3: Unusual Payment Requests Raise Alarm

Here’s a helpful hint – mainstream businesses ask for normal ways to get paid. Did an invoice suggest payment in special crypto currencies or vouchers? Did you get pressured to pay fast or face a late fee? If these situations pop up, react; these tactics signal that fraudsters are at work. Legitimate businesses don’t typically resort to such pressure cooker terms.

Step 4: Question the Document Source

Wondering where the invoice came from? Did it arrive out of nowhere? Does the sender seem shady? Watch out. 

Where the invoice originates from can be a big clue. Legit firms have a known source; they track all documents. Fake invoices can come from anywhere, and scammers can even use realistic mailing addresses, so be careful.

Step 5: Look For Strange Contact Details

Have you ever seen a random mobile number on an invoice or a non-business email address? Be alert. These are also signs of a bogus invoice. 

Fraudsters change contact details, using random numbers and personal emails; they don’t want to risk you contacting the real company! Their goal is to trick you in order to make you their next victim. so, always check and double-check contact details.

Examine our guide to learn the proper way to make an invoice.

Identify a Fake Invoice

What prevention should be done against a fake invoice?

With the right tools, you can protect your business from fake invoice scams. Here’s how:

Use Billdu Software

Billdu software is the ultimate solution to tackle fake invoice scams effectively and efficiently. This cutting-edge platform offers a comprehensive invoice management system, empowering you to monitor, track, and validate every invoice that passes through your business. With its intuitive interface and advanced security measures, Billdu not only streamlines your accounting procedures but also adds an extra layer of financial protection for your business. Don’t risk losing your hard-earned money to fraudulent invoices; protect your business by investing in Billdu.

Free 30-day trialNo credit card requiredCancel anytime
Billdu invoice maker and invoicing app

Keep Strict Invoice Controls

  1. Check Before Paying: Invoices need checking; don’t rush to pay them, and check each item carefully. Ask yourself, “Did we order this?” Double-check with your records to help block bad invoices.
  2. Keep Powerful Purchase Records: Having records is important; write, keep, and organize records diligently – it’s one way to stop scams. Maintain records of all orders, including purchase requests.
    You also need shipping notifications and paid invoices. When a new invoice comes, check your records; use them to confirm invoice details, and update these records regularly. Teach your staff to use these records – they should know where to find these files.
  3. Avoid Surprises: Surprised by an invoice? Don’t pay for it. Check your records first. Did your company place the order? Check with the person who supposedly did. Make sure the invoice is real; phone calls can help, so call vendors to confirm changes. Also, call to check big invoices – this adds to your protection.
  4. Use Modern Tech Tools: Use the latest tools to track invoices, as technology can stop scams. There is software to guard money – it checks invoices against records. Report anything suspicious quickly.

Train Your Team to Be Cautious

  1. Share Scam Info: Explain fake invoices; show new scam methods, hold meetings or workshops, and talk about scam examples. Teach invoice checking, and share good practices; well-informed staff can help to catch scams faster.
  2. Explain Risks and Signs: Show your team the risks; teach the dangers of approving fakes, and make sure everyone knows to check every invoice. Demonstrate the warning signs, and ensure that staff fully understand both the risks and red flags; your team can protect your business.
  3. Train for Safety: Make your employees cautious, and teach them how to avoid fake invoice scams. Have regular training sessions, and educate your team well. Teach new scamming tricks as they begin to trend; if your team can spot fake invoices, your business will be safer.
  4. Practice Helps: Set practice scenarios to aid the training. Show fake invoices often so they identify scams faster – ideally, make it a habit. 
  5. Share Real Stories: Talk about real cases, to let them know it happens in real life. Show how businesses suffer to help the lessons stick. 
  6. Set Clear Rules: Create guidelines for your team to follow. Give them a clear process, making it as easy as possible to learn and maintain best review practices.
  7. Support Their Efforts: Give your team support. Let them ask questions, provide helpful answers, invite experts to talk, and keep them updated on scams. Encourage vigilance and unity in protecting your business.
  8. Test Skills: Test your team’s knowledge, using quizzes and tests; ensuring they learn and retain the information well helps to ensure stronger protection. Help them find weak points, and train more in those areas.
  9. Praise Successes: Congratulate your team’s efforts; if they catch fake invoices, they deserve praise. Still, encourage them to keep learning, and to keep their guard up.

Secure Your invoices

Secure Your Systems

  1. Choose Good Antivirus Software: Scammers will often use malware to access your financial records. “Protect yourself with antivirus software to shield your business data, and choose high-rated antivirus software; they are your best bet for fighting viruses and ransomware that can harm your finances,” says Zachary Jarvinen, Vice President of Exact Payments. Implement robust security measures to block malware effectively.
  2. Keep Firewall Updated: Firewalls secure your network, stopping unauthorized access. Regular updates are vital to patch security gaps; also, adjust your settings to help keep sensitive info safe. An updated firewall fights threats and keeps your records safe. Scammers may try to infiltrate; don’t let them!
  3. Examine Firewall Logs: Firewall logs can alert you to potential breaches, so check these logs often for any security issues. Your financial records are precious – don’t let scammers touch them!
  4. Spend on Secure Software: Invoice scams are dangerous, as they can be used to access your records. By getting good antivirus software, you can fight back. Antivirus software shields your data, so pick a top-rated one, and it should protect against many threats. Viruses, ransomware, and malware are scary; your financial info must stay safe.
  5. Do Regular Firewall Updates: Firewall as a service keep you safe. They stop unwanted access. It’s essential to update them. New security patches are crucial. Set your software to restrict access, mostly for sensitive information. 
    Updating it regularly is a must. Bring in the new security patches; set specific access rules; protect your valuable info. An updated shield blocks attacks, and your records stay untouched. A fresh firewall can resist dangerous attacks. The safety of your records is important. Some might try to breach your business. Keep them out!
  6. Check Logs Often: Review firewall logs routinely. They record the attacks. You can find security problems. Or breaches in the system. Your financial data should be secure. Scammers should not get in.

What to Do if You’ve Been Scammed

Becoming the victim of scammers can feel quite shocking, and certainly anxiety-inducing when it comes to the extent of damage that may result and how to improve protections moving forward. Still, a quick and smart move can help; here’s what to do when scammed:

Step 1: Report the Scam

  • Contact Your Local Police: Do this as soon as you know you’ve been scammed, and give them plenty of details about the scam. Who was involved? How and when did it happen? The police will guide you; they know the next steps to take, and can also advise against further scams
  • If You’re In the U.S., Tell the IC3: This is short for the Internet Crime Complaint Center, a division of the Federal Bureau of Investigation (FBI). They deal with crimes on the internet, so by informing them, you help to catch the scammers at large
  • Review Your Security: Next, think about your security in general, and whether it’s time for a change; a good place to start is with your passwords. Make a change where you should. Think more broadly than just financial accounts; include your email, and any other accounts indirectly tied to your money
  • Hunt for Break-Ins: Examine your accounts next – this is very important. You’re looking for something unusual (in other words, anything you didn’t do). Inform your bank or card provider right away

Step 2: Reevaluate Your Security

  • Quickly Change Passwords: After a scam, change passwords fast. This includes all financial accounts, emails, and linked accounts to prevent any further unauthorized account access across the board
  • Inspect Account Security: Check all accounts, especially bank statements – look for strange transactions, and alert your bank or card provider if found

Step 3: Considering Resorting to Small Claims Court

If you have lost a significant amount of money, thinking about legal options is smart. One key place to look at is the small claims court, especially for smaller civil cases.

Using small claims court can be beneficial for a number of reasons:

  • Small claims cases deal with disputes of typically up to $10,000, although this limit can vary between states
  • Filing a case does not always require a lawyer, which can make it less costly
  • Many small claims courts provide mediators. They can help reach a settlement without going to trial

To give you an idea:

  • According to the National Center for State Courts, almost 17 million cases are filed in small claims court in the U.S. each year
  • Such courts have a high rate of success, with many people receiving back at least part of the money lost to scams

check all invoices

Key Takeaways

Continuous measures to ensure the safety of your data and finances are necessary in an increasingly digital world. One could consider cyber insurance as an additional safety net against potential losses caused by scams, enhancing your financial resilience in the face of these threats.

Being prepared against the threat of fake invoices and similar scams is a task that requires the right mix of a well-trained team, an effective system in place, and a proactive attitude.

Your team should be knowledgeable about the techniques scammers use. This allows them to recognize them in time, thus strengthening the first line of defense.

Implementing the right systems is also crucial. It’s important to install effective anti-virus software, keep your firewall updated, and regularly examine firewall logs. These steps are all important when safeguarding your financial records.

If defenses fail and the scam can’t be prevented, one must swiftly report it to the relevant authorities, such as the local police department or the Internet Crime Complaint Center. 

Victims should also consider taking legal action. For example, resorting to the small claims court can help mitigate damages.

In the face of these escalating threats and challenges, the use of software like Billdu can significantly help increase your security measures. Billdu offers an array of features that safeguard your invoices and financial details against potential scams. It ensures that your records are well-organized, easy to track, and secure. Don’t wait to become a victim of a scam to take action. Start using Billdu today and take proactive steps towards securing your financial data!

Protect Yourself from Fake Invoices with Billdu!

Guard against fake invoices effortlessly using Billdu. Don’t wait to become a victim of a scam to take action. Experience the difference today – try Billdu pricing plans and ensure your financial safety!

Free 30-day trialNo credit card requiredCancel anytime
Billdu invoice maker and invoicing app

Looking for Downloadable Invoice Templates?

Wondering what should an invoice look like? Look at our free invoice templates in a number of formats
SRUSHTI SHAH

Product marketer at Middleware

Srushti Shah is an ambitious, passionate, and out-of-the-box thinking woman having vast exposure in Digital Marketing. Her key focus is to serve her clients with the latest innovation in her field leading to fast and effective results.

We use cookies to make your experience better, to improve our services, and for advertising. By continuing to browse our site, you agree to accept our cookie policy

Continue