How To Protect Against Business Email Compromise Scams

January 12, 2016

Over the last two years, the FBI has reported close to 10,000 businesses victimized by a particular form of online fraud referred to as a business email compromise scam or BEC scam, which typically involves the fraudulent transfer of funds from the company to accounts in Hong Kong and mainland China. According to the FBI, more than 8,000 businesses fell victim to business email compromise scams and suffered a combined loss of more than $1.2 billion. Since January 2015 there has been a 270 percent increase in the number of victims falling victim to BEC scams and a similar increase in the total amount of loss they suffered. The FBI reported that in the majority of BEC scams the funds are transferred to bank accounts in Hong Kong or mainland China.

Gibson Dunn partner Robert S. Pé and associates Winson S. Chu and Suzanne Siu are the authors of "How to Protect Against Business Email Compromise Scams," published recently by Law360. They work closely with Gibson Dunn partner Kelly Austin, whose practice focuses on government investigations, regulatory compliance and international disputes. The authors were contacted by U.S. Department of Homeland Security agents after successfully freezing the proceeds of a BEC scam in bank accounts in Hong Kong. As the article notes, the DHS is particularly concerned about the apparent ease with which fraudsters have been able to gain control of bank accounts in Hong Kong, despite stringent anti-money laundering procedures.

Mr. Pé focuses his practice on international commercial dispute resolution and has extensive experience in international arbitrations in Hong Kong, London and Singapore under various rules including the HKIAC’s Administered Arbitration Rules, the ICC Rules, SIAC’s Arbitration Rules and the UNCITRAL Rules. Ms. Austin has extensive expertise in government and corporate internal investigations, including those involving the Foreign Corrupt Practices Act, and anti-money laundering, securities, and trade control laws. She also regularly guides companies on creating and implementing effective compliance programs. Winson Chu and Suzanne Siu are members of the firm’s general commercial litigation, international arbitration and white collar groups. The team is based in Hong Kong.

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