With real-world examples from Affiliates, FIDI Business Intelligence Manager Marie-Pascale Frix describes how FIDI Netting is helping businesses mitigate the chance of falling victim to invoicing fraud.
This year alone, FIDI’s dispute resolution service has been approached several times about phishing attacks that have led to invoice payments being diverted to fraudulent bank accounts. In the aftermath, the parties involved often disagree about who should bear the financial loss. Within the FIDI community, however, there is an easy and effective way to mitigate this risk: FIDI’s Netting service.
A real-world case
Earlier this year, Asian Tigers China reported a phishing attempt, in which fraudsters impersonated the company using a fake domain and instructed partners to await ‘new banking details’. The firm issued a warning, highlighting that its banking details had not changed and that FIDI members could safely use FIDI Netting to settle accounts instead.
Jordan-based logistics providers CML was impacted when several trading partners paid their service invoice to fraudulent bank accounts. President Nadine Khouri Halaby said:
‘The rise in phishing emails in our sector can lead to fake payment requests and funds being sent to the wrong accounts, potentially resulting in disputes between trading partners, eroding trust and disrupting operations. FIDI Netting helps reduce this risk by handling payments in a secure, centralised way.’
How Netting protects against phishing
The FIDI Netting system consolidates all monthly payments between Affiliates into a single, net transaction. This significantly reduces opportunities for fraud because:
● There is no direct exchange of banking details: Affiliates don’t need to rely on email instructions, the main entry point for phishing.
● Fewer transactions take place: one net payment is made, dramatically lowering businesses’ exposure to fraud.
● Bank details don’t have to be exchanged for every invoice
● Central oversight: the process is standardised, transparent and less vulnerable to manipulation.
Netting saves time, reduces transaction costs and creates a safer environment for financial settlements.
Practical tips for reducing risk
● Verify payment requests. Confirm any changes to bank details using a known phone number – treat urgent or unusual requests with caution.
● Pay invoices to FIDI Affiliates using FIDI’s Netting service.
● Secure emails and accounts. Enable multi-factor authentication for email and financial accounts, train staff to recognise phishing attempts, and report suspected phishing to IT immediately.
● Use dual approval systems. Implement multi-layered approval for significant payments to reduce the risk of a single point of failure.
● Monitor payments. Review outgoing payments and audit for irregularities.
● Have a response plan. Prepare a protocol for responding to phishing incidents, including who to notify, how to contain threats, and how to communicate externally.
● Update security software. Protect email and financial systems with up-to-date software and firewalls.
● Report fraud early. Notify your bank and authorities immediately.
● Get cyber insurance. A robust policy can mitigate financial impact.
Essential tools
Phishing continues to be one of the most pressing financial risks for international moving companies. By adopting FIDI Netting, and using tools such as FIDI’s Dispute Resolution Scheme, Professional Cooperation Guidelines (PCG) and FASI, Affiliates can help protect themselves and their partners against fraudulent payment diversions and overdue payments.