Scammers came close to leaving firm bankrupt

Alex Duke, 43, owner of Exit Interiors, Harrogate, lost nearly £50,000 in an online scam and says it almost bankrupted her business before she managed to get the money paid back.

She has now called for an overhaul of the way banks operate to protect victims of fraud.

In May, a fraudster from the United Arab Emirates emailed an order for £5,200 of lighting.

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Ms Duke receives a handful of orders from the Middle East every year and says she always treats them in the same way, to be suspicious but proceed with caution and not do anything until payment is received.

A few days later she received an email saying someone in the man’s office had made a mistake and paid £52,000 instead of £5,200 and could she repay the difference when the money transfer arrived in her account.

Around two weeks later an uncleared deposit arrived in her bank account for £52,000 and the next day its status was changed to “cleared funds” by the bank, so Ms Duke ordered the lighting and repaid the difference.

But instead the scammer had posted Ms Duke’s bank a fraudulent cheque for £52,000 and it was this which appeared in her account.

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“The bank made the transfer and then two hours later contacted me to say the cheque that I had sent them for £52,000 was fraudulent,” she said.

“When my account said it was cleared it was actually in a seven-day clearing process.

“I had described what had happened to the bank, and despite being told later that it was a known scam, they didn’t pick up on the signs.

“At first they told me if they couldn’t get it back, I was liable.

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“I just thought ‘this can’t be true’. I felt I had protected myself all the way and it was the bank that let me down.

“At first I thought ‘this will get sorted in a day or two, surely they can stop the money’.

“I had to go through two-and-a-half weeks where I was getting no information whatsoever.

“I reported it to the police but they told me they couldn’t do anything about it, even though we managed to get the fraudster’s telephone number.

“They told me it wasn’t worth them looking into it.

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“They pretty much said it is impossible to trace as it is an international case.

“All my direct debits were just getting bounced right, left and centre, I couldn’t get any of my orders shipped – it was absolutely insane.

“The senior people in the bank only got involved after I gave a radio interview about the issue. Once they did they resolved it 
very quickly and I got my money back.

“They told me how they had lessons to learn and are changing policy. If it had gone on longer and I would have had to pay my quarterly business rent and the wages I would have gone bankrupt.

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“I didn’t know about the seven-day rule, where cleared funds can be withdrawn again, but the scammers obviously did.”

Mike Andrews, head of newly formed national E-Crime trading standards unit based in Northallerton, York and Suffolk, said the cost to the UK economy had been estimated at between £3bn and £10bn a year. “It is certainly hundreds of millions, if not billions, that is lost every year.

“It is going on all the time as well. As more and more people do their transactions online and more and more people carry out their lives over the internet that is where the fraudsters operate.

“A lot of the scams we investigate haven’t changed; they are just on a different medium.

“These are organised criminals gangs from across the world.

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“There is still a huge number of individuals out there who use the internet and social media to 
rip people off but there is also a large element of serious organised crime.

“We also get UK-based gangs using web facilities provided offshore which makes it much more difficult to follow their trail if the website is based in Russia or the Cayman Islands.

“We can certainly make an impact. But we are not going to deal with all the problems that are there that is why we have to work with other agencies to tackle the criminal dimension.

“As soon as we shut one website down, it is so easy to set up another,” he said.