How To Protect Yourself From Payroll Scams

Around $5 Million in total are lost to fraudulent payroll operations every year. In spite of many SNS professional accounts spreading awareness, such scams keep rising. Since 2018, these types of scams have been on a rapid rise. The reason behind this is businesses and individuals not being aware of the ways to protect themselves from such practices. This is because the scammers use spoof emails to run this fraud. How they gain access to those emails? It's a whole different story.

The Process Of A Payroll Scam
Many small and growing businesses rely on various payroll softwares for handling their employee data. Sometimes, they may come across some issues that are out of their reach. So, they seek help from organizations that provide such services. While there are some companies that really provide legitimate payroll services, some use these services as a cover and also as a gateway for their scam.

When you contact one of these scams, they will offer you their services and in order for them to provide said services, you'll have to share the credentials of your payroll software account. This means that they'll have access to all the information in that account. This includes employee names, email IDs, salaries, account numbers, etc. They may also offer to integrate their software with the software you use. This makes getting the information a lot easier for them.

After this, they spoof the email IDs of the employees and send fake emails to the owner of the organization requesting to change their bank account details in the payroll system. In most cases, the owner will change the details as per the request thinking that it's sent by the employee. This error is mostly detected after two or three months of the employee not receiving his/her salary.