'Devastating blow': Homewares business hit by apparent email scam

Small business owner Phoebe Bell believes scammers were watching her emails "for months" before they swiped $10,000 from her homewares operation, Sage and Clare.

Earlier this year, the company placed a stock order with an unnamed supplier. There was nothing out of the ordinary about the interaction — Bell outlined the required stock and emailed back and forth for weeks about the order.

Sage and Clare owner Phoebe Bell says the experience has shaken "my self-confidence, because I thought I was smarter than that".

Photo: Supplied.

The supplier then gave details of a new bank account to pay the money into for the order. This was not unusual, Bell says, because suppliers often change their details.

Sage and Clare paid $10,000 into the requested account, but after strange emails kept coming from the supplier, Bell had a bad feeling.

She was right. When she contacted the supplier directly, it said it hadn't had any communication from her in months and had assumed she had just "dropped off", Bell told Fairfax Media.

"It totally shocked me. I never saw, or thought, this could have been a scam," Bell says.

Bell believes her business was the victim of a targeted scam, where a third party has probably hacked emails and read through months of correspondence so when a business like Sage and Clare placed an order, they could intercept the details and redirect payment funds.

She says it's clear the scammers "knew a lot" about her business: they chatted with her in detail about past orders she had made and appeared knowledgeable about the company's processes. Nothing seemed out of the ordinary about the emails or the invoice that was sent to Sage and Clare to pay.

Bell has reported the incident to the Australian Federal Police through the Australian Cybercrime Reporting Network (ACORN), as well as to the bank.

"It's frustrating, because we already have so many insurances in place. And if you were burgled, you'd have the police out there right away," she says.

However, at this stage it looks like the company has no way of recovering the funds.

Phoebe Bell says it's lucky the scam hit at a time when her business was established and able to absorb the loss.

Photo: Supplied.

Bell says it's lucky the scam hit at a time when her business was established and able to absorb the loss, even though the hit is "a devastating blow".

The company was founded in 2013 and has one Melbourne warehouse store as well as a strong online presence and around 100 distributors, with $1 million in turnover.

"Fortunately, $10,000 is on the smaller side [of orders]," Bell says.

The company took to Facebook to warn other small businesses about the incident, with Bell saying it's an experience that shook her "self-confidence, because I thought I was smarter than that".

"I feel stupid and naive," she wrote on Sunday night.

However, a chorus of supporters have emerged for the business, with many commenters saying these situations could happen "to anyone".

There have been a number of business-related impersonation scams emerging in recent months, including a series of hacks on conveyancers, which have seen home buyers send settlements to fraudulent accounts.

Losses from phishing scams, where fraudsters prompt victims to give up sensitive information like passwords or personal or business details, have also spiked over the past month.

According to records from the Australian Competition and Consumer Commission's Scamwatch site, Australians reported losses of $56,685 last week alone - an 83 per cent increase on the last week of July.

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