According to a study by Allianz, fraudulent calls from bosses and diverted payments are on the rise again among fraudsters in German companies - but employees remain the most dangerous.

"The internal perpetrator is the huge problem," said Rüdiger Kirsch, fraud expert at credit insurer Allianz Trade, in Munich on Wednesday. Although internal perpetrators will only account for 51% of claims this year (2022: 57%), they are still responsible for 69% of claims (2022: 73%), according to Allianz data. "The typical perpetrator is highly educated, in their mid-40s and an executive," said Kirsch. The most common misappropriation of funds is by accountants.

Last year, the Federal Criminal Police Office recorded 73,144 cases of white-collar crime, 43 percent more than in 2021, with losses totaling 2.1 billion euros. Under fidelity insurance, credit insurers such as the European market leader Allianz Trade (formerly Euler Hermes) often have to take responsibility. Hacker attacks do not play the dominant role here. "People remain the weak point," said Kirsch. A mixture of pressure and flattery is enough to induce employees to transfer large sums to obscure accounts.

The "boss scam" - in technical jargon "fake president" - is experiencing a renaissance, said the Allianz expert. This involves a fraudster posing as a superior and instructing urgent transfers from the company account abroad, which trickle away into dark channels. The sums involved are no longer the 50-million-euro amounts that made headlines in the cases of Leoni and the Austrian aircraft supplier FACC a few years ago, but sums of 500,000 to five million euros. "But it's the quantity that counts." In 2022, the amount of damage rose by 38 percent, and this year it is likely to be a further 24 percent. However, the greatest losses are caused by payment fraud, i.e. the diversion of money flows (payment diversion). This accounts for 41 percent of the losses registered by Allianz Trade.

Electronic tools such as ChatGPT are likely to exacerbate the problem, Allianz Trade believes. Voices and videos can already be faked today. In the meantime, emails or employee letters fed into the software are enough to spit out fake instructions in the style of the company boss.

In most cases, however, the perpetrator is sitting in their own company, often protected by working from home. In the case of accountants, it is advisable to obtain a certificate of good conduct, said Kirsch. Many are dismissed only to cause new damage with the next employer. Kirsch reported on cases such as the manager who helped himself to 1.4 million euros from the expense fund to finance his gambling addiction, or the accountant who used black funds to finance food and medical expenses for her 200 cats. Criminologist Hendrik Schneider criticized that the compliance systems in most companies are too focused on corruption and too little on such offenders.

(Report by Alexander Hübner, edited by Ralf Banser. If you have any questions, please contact our editorial team at berlin.newsroom@thomsonreuters.com (for politics and the economy) or frankfurt.newsroom@thomsonreuters.com (for companies and markets).)