Supplier and vendor relationships are essential to running a successful business, but they can also be a target for fraud. One of the most common and high-impact threats facing businesses today is supplier and vendor fraud, often carried out through invoice manipulation. In these schemes, criminals submit fraudulent invoices or alter legitimate ones to reroute payments to accounts they control.

This type of fraud continues to grow as criminals exploit digital payment systems, email communication and busy accounts payable processes. For businesses of all sizes, the financial and operational impact can be significant.

What Is Supplier/Vendor Fraud?

Supplier or vendor fraud occurs when a criminal impersonates a trusted vendor or manipulates invoice details to divert payments. This can happen in several ways, including:

• Sending a fake invoice that appears to come from a legitimate supplier
• Altering banking details on a real invoice
• Emailing payment change requests while posing as a known vendor
• Intercepting invoices and modifying account numbers before delivery

Because these requests often appear routine and urgent, they can easily bypass standard controls, especially if processes rely heavily on email and manual approvals.

Why Invoice Manipulation Is So Effective

Invoice fraud is particularly dangerous because it targets established business relationships. Criminals may monitor email conversations, study payment cycles or use publicly available information to make their requests look authentic. Once a payment is sent, recovery can be difficult, especially if funds are moved quickly across multiple accounts.

For banks and businesses alike, this makes supplier/vendor fraud one of the highest-impact forms of commercial fraud.

Warning Signs to Watch For

While these scams are increasingly sophisticated, there are common red flags businesses should not ignore:

• Requests to change payment instructions without prior notice
• Invoices with new or unfamiliar bank account details
• Messages creating urgency or pressuring immediate payment
• Slight changes in email addresses, spelling or formatting
• Invoices that don’t align with typical billing amounts or timing

Even a single inconsistency should prompt additional verification.

How to Protect Your Business

Strong internal controls and proactive verification are your best defense. Consider these best practices:

• Verify all payment changes using a trusted phone number—not email alone
• Require dual approval for invoice processing and payment releases
• Limit who can update vendor banking information
• Educate employees regularly on fraud trends and warning signs
• Use secure payment methods and fraud-monitoring tools
• Review vendor lists and payment activity routinely

Treasury Management solutions can also play a critical role by adding layers of authentication, payment controls and visibility into outgoing transactions.

A Partnership Approach to Fraud Prevention

Supplier and vendor fraud continues to evolve, but businesses don’t have to face it alone. At Busey Bank, we’re committed to helping your business navigate this new era of fraud. Together, we can protect what you’ve built, strengthen your defenses and give you peace of mind. Our Treasury Management team brings a wealth of expertise and experience to the table, offering tailored solutions designed to enhance your organization's security. To learn more about how Busey can help you safeguard your business, visit busey.com/treasurymanagement.

Your security is a top priority—and staying informed and cautious helps preserve your financial wellbeing. If you believe you’ve been the victim of fraud or a scam on a Busey account, contact our Treasury Management Support team, reach out to your Relationship Manager or follow these steps outlined by the FBI Internet Crime Complaint Center. For more information, you can also read our Fraud Prevention FAQs, check out our Fraud Prevention Toolkit or view our Payments Fraud Trends & Prevention booklet.