Beware Of Business E-mail Compromise ("BEC") Schemes

Executive Summary

Business e-mail compromise ("BEC") schemes have become cybercriminals' method of choice in defrauding businesses by impersonating a payee party and deceiving a payor party into sending funds to an account controlled by the fraudulent third party. In response to BEC schemes, courts are increasingly turning to traditional Uniform Commercial Code ("UCC") principles holding that the party that is in the best position to avoid the loss and that fails to exercise reasonable care to avoid the loss then becomes responsible for the loss. To protect against the ever-present risks of BEC fraud in today's business environment, it is more important than ever for businesses to educate their customers to first verify any changes in payment information by phone through a trusted number before sending any funds.