“Shark Tank” Star’s $400K Scam: Lessons from a BEC Fraud

Her shark tale about her business getting scammed via a fake email is all too common. Getting the money back is rare. Let it be a lesson to learn now. In case you missed it, there was yet another story about yet another corporate scam—and this one made the news because it involved a celebrity reality-TV show star. Barbara Corcoran, the real-estate guru and one of the stars of “Shark Tank,” lost $388.000 in mid-February of this year to a common, yet sophisticated email scam. A bookkeeper who works for Corcoran was tricked into wiring the money to a scammer overseas. It looked like business as usual. There was no reason to be suspicious,” Corcoran said later to a People magazine, adding “I invest in a lot of real estate.” In an amazing and rare turn of event, Corcoran staff was able to get the money back a few days later. But not from the scammers. Corcoran’s bank contacted the bank that was sending the wire transfer and was able to get that them put a freeze on the transaction…so that Corcoran’s team could convince them it was a fraudulent transaction. It worked. The scammers never received the bank wire. Business Email Compromise (BEC) Scams with Steve Weisman Let the fake –email awareness training begin. This story should be a warning to you. It could happen to any size company, and—as this story proves—it could even happen to a successful entrepreneur, such as a lawyer, doctor…or a celebrity. Getting scammed for thousands of dollars has nothing to do with intelligence, or negligent employees. It has to do with not having company policies, “checks and balances” in place…and maybe some timely training on email scams and phishing tactics. Here’s how Barbara Corcoran’s team was fooled by a “fake email chain,” according to her account. According to the Wall Street Journal (Feb. 28 of this year), in 2019, the FBI received nearly 24,000 complaints about these types of email account compromises, up from the year before. They estimate losses from this type of fraud to more than $1.7 billion. “The email gets hacked and the bad guys can step into the email threads,” a lawyer was quoted saying in the same article. If an email account is hacked, a scammer could gain access to your company calendars, contacts, emails…and all the valuable information they contain. In the Corcoran case, it’s not clear if the account was hacked or not. Company policy changes. Now is the best time to review email procedures for you and your company, and even your family. Email scams are big (bad) business…a little bit of training could save you a lot of money and grief later. Because it isn’t likely you’ll get your money back if YOU get scammed.