Who pays when an invoice is intercepted and bank details are changed?


Supplier A sends an invoice to Customer B via email, but it is intercepted by a fraudster who changes the bank details before it reaches Customer B. Customer B pays the invoice to the fraudster’s account, thinking it is Supplier A’s account.

In this scenario, who pays?

  • Does the Customer need to pay again so the bill is settled with the Supplier?
  • Does the Supplier write it off as a loss?
  • Do both sides agree to split the bill and share the pain?

Reality suggests, this is the Supplier’s fault. Their email was intercepted. They should have switched to a safer and more secure way to send invoices (e-invoicing) to protect their business as well as their Customer.

However, it can be the Customer’s fault, too. This is because they are responsible for verifying that the invoice is legitimate before paying it.

As research indicates, in such instances, there are various approaches to who really pays which solely depend on each situation:

  • The Supplier might demand the Customer to pay again.
  • The Customer might demand that their bank repays the funds transferred.
  • The person who commits invoice fraud (fraudster) is liable for their actions.
  • The Supplier has a duty to the Customer to ensure that they were not the victim of fraudulent emails.
  • In an invoice scam, the Customer is typically liable for the intercepted payment.
  • In some cases, the Supplier may be liable for an intercepted payment if they were negligent in protecting their payment information.

How can e-invoicing help to prevent invoice interception scams?

E-invoicing is a secure way to exchange invoices electronically through the Peppol network – a more efficient, secure and reliable invoicing process.

E-invoices are verified by the Peppol Access Point before they are sent to the Customer. This verification process ensures that:

  • The invoice is from a legitimate Supplier.
  • The invoice data is accurate.

In turn, this gives the Customer confidence that they are paying the correct Supplier for the correct invoice amount and that their payment will be processed securely.

For more insights, read our content piece on Accountants Daily.

Learn more about e-invoicing at www.link4.co/uk.

Footnote: In this article, “e-invoicing” is used interchangeably to refer to electronic invoicing which is sending an invoice without needing email and PDFs.

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