Producers warned over identity fraud scam

The WSTA and the Metropolitan Police are urging wine producers to step up checks on orders to combat increasing use of identity fraud as a means of obtaining goods without payment.

Since May 2011 the WSTA has catalogued over £600,000 worth of goods defrauded from wine companies through use of false email addresses and identities, generally involving impersonation of existing companies and their employees.

Typically, the fraudster identifies an established UK importer, with email address and contact details of a senior employee. They then register a similar email address and place an order with a producer or supplier in Europe for speedy delivery to an address not normally used by the UK import business, requesting payment within 30 days and claiming it is covered by export insurance. Once delivered, the criminals disappear with the goods without settling the invoice.

Working with Operation Sterling, the Metropolitan Police Service's economic crime prevention and disruption unit, the WSTA is issuing a set of guidelines for producers to guard against this form of fraud:

• Ask for immediate payment and wait for the confirmation from your bank that the money has reached your account even if it means delaying the order. If the potential client is serious and genuine, they will be able to wait.

• Check the contact detail of the person contacting you and follow up with a phone call if possible.

• Check that the email address which is used has the same format as the addresses used by the employees of that company

• Check that the postal address provided for the delivery is that of the head office or one of the branches or one of the warehouses of the company (use Google map and streetview if necessary)

• Check the VAT and Excise numbers provided using the following tools at websites:
VAT and  Excise
Please note that before dispatching any goods under bond, you will be asked to confirm the customer's excise details. Goods may not be dispatched without it.

• Be wary of urgent orders

• Be wary of non-personalised and high value orders which are usually sent to any producer regardless of their range of products.

• Be wary of payment by credit card as these are rarely used in export transactions, and be wary of emailed bank transfer confirmations as they often turn out to be fake

• If you are unsure about the details of a UK based business, please contact the WSTA (ww.wsta.co.uk) in London - 0044 2070 893 880 or by email fraudalert@wsta.co.uk

• Download the guidelines

WSTA CEO Jeremy Beadles said: "The feedback to the WSTA's Fraud Prevention Unit, launched in May this year, shows that criminals targeting wine producers are increasingly using identity theft as a means of securing goods without paying for them. It's vital producers are aware of the pitfalls and take steps to guard against this form of fraud."

Robin McMillan, Chairman of the WSTA's Distance Selling Panel and Chief Operating Officer, Berry Brothers & Rudd Ltd, said: "This is an issue affecting the whole trade so we all have to be vigilant. I would urge all wine importers in the UK to send the WSTA guidelines to their producer database and encourage those producers to forward the information on within their respective countries to ensure they are not being caught out. With this in mind we are making the guidelines available in several European languages"

DCI Nick Downing, head of Operation Sterling, said: "These crimes highlight the numerous ways that fraudsters will use stolen or false IDs to commit other more serious crimes. The MPS is dedicated to tackling the ever changing threat of ID fraud. Businesses and members of the public can help us do this by taking simple steps to protect themselves."

1 January 2011 - Felicity Murray