Forum: SMEs should watch out for scams involving falsified purchase orders

The company I work for recently nearly fell victim to a purchase order (PO) scam.

With the help of the Singapore Police Force, we were able to recover our goods, despite running into some obstacles.

The scammer impersonated a Ministry of Health (MOH) staff member and sent us a PO for goods worth nearly $8,000 with MOH's letterhead and valid billing and delivery addresses.

As it is common for government-related institutions to have a net 30-day payment policy, no advance payment or cash-on-delivery was required.

A couple of days before the delivery, the scammer said MOH's premises were full and changed the delivery address to a warehouse in Changi. The goods were delivered as scheduled and signed for by staff at the warehouse.

Three days later, the scammer sent us another PO that was more than double the first PO's value. The short interval between the orders was suspicious, so we investigated and discovered that it was a scam.

We were unable to recover our goods from the warehouse, as they were in a free trade zone. We were told that the goods were scheduled to be sent out of Singapore soon.

We filed a police report, and the police contacted the warehouse and stopped the delivery.

To recover our goods, we had to pay the warehouse a service fee and pay Singapore Customs a permit fee to clear our goods from the free trade zone.

The current scam awareness campaign is targeted mainly at the general public.

Efforts should also be made to warn small and medium-sized enterprises against PO scams, especially if this is a trend that is re-emerging after cases were reported a few years ago (Companies lost $749,000 worth of goods in purchase order scams since August, Sept 30, 2020).

Law enforcement bodies could also caution logistics companies to be wary if asked by someone overseas to act as a receiving store for a public institution.

Lastly, Singapore Customs could also make it easier for scam victims to recover their goods from a free trade zone.

With greater awareness, we as a country can prevent scammers from succeeding in Singapore.

Wong Joon Fong

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