Chestermere businesses are being warned to take a second look at unfamiliar purchase orders after an Alberta company reportedly lost more than $50,000 in merchandise to a sophisticated impersonation scheme.
The Better Business Bureau Serving Alberta and East Kootenay issued the alert July 6, saying criminals are posing as employees of established corporations and placing large orders with unsuspecting suppliers.
The requests may appear legitimate.
According to the BBB, the fraudsters create email addresses that closely resemble those used by real companies. In some cases, they also build imitation websites and assume the names of actual employees to make their communications more convincing.
The criminals then order large quantities of products, often asking that the merchandise be delivered to a third-party warehouse. From there, the goods may be redirected or shipped outside Canada before the supplier discovers that the purchaser was not who they claimed to be.
One Edmonton business is known to have lost more than $50,000 worth of products through the scheme, according to the BBB. The organization did not identify the company or specify what merchandise was taken.
Mary O’Sullivan-Andersen, president and CEO of BBB Serving Alberta and East Kootenay, described the operation as sophisticated and said employees should be trained to recognize signs of corporate impersonation.
For small and medium-sized businesses, the danger lies in how ordinary the request can appear.
A new customer places a sizeable order. The email includes a recognizable corporate name, a professional signature and what appears to be a company website. The purchaser may also ask for quick delivery, leaving employees little time to check the details.
Each part can look reasonable on its own. Together, they can create enough confidence for a business to release thousands of dollars in products before payment has been secured.
The BBB recommends independently verifying the identity of new customers rather than relying on the contact information contained in the order itself.
That may mean finding the corporation’s official telephone number through a trusted source, contacting its main office and asking to be connected with the employee whose name appears on the request. Businesses should also confirm that the shipping address is connected to the purchaser and question any request to send goods to an unfamiliar warehouse or freight-forwarding location.
A small change in an email address can be easy to miss. Fraudsters may substitute one letter, add a word or use a domain that looks almost identical to the legitimate company address.
The same care should be taken with websites. A polished page, corporate logo or staff directory does not prove that the site belongs to the real business.
The BBB is also advising companies to complete more detailed checks before extending credit to new customers. Those checks can include confirming banking and trade information, reviewing the company’s established contact details and speaking with known representatives.
Urgency should be treated as a warning sign rather than a reason to skip normal procedures.
A customer who insists that a large order must be processed immediately may be attempting to prevent employees from checking the information. Businesses should be particularly cautious when the request combines a rush shipment, a new account and delivery to a third party.
No single employee should have to carry that responsibility alone. Clear approval procedures for large or unusual orders can give staff permission to pause the transaction without worrying that they are delaying a legitimate customer.
The BBB recommends reporting suspected fraud to local police through the non-emergency line and submitting information through its Scam Tracker. Businesses that have lost money or merchandise can also report the incident to the Canadian Anti-Fraud Centre.
The warning is provincial, but the lesson is local.
Chestermere’s business community includes independent retailers, contractors, wholesalers and home-based operations. For many, a fraudulent order worth several thousand dollars would not be a minor bookkeeping problem. It could threaten payroll, cash flow or the survival of the business itself.
The safest large order may be the one that takes an extra telephone call to confirm.