It's a Seedy Business
Had to say it.
A $1.2m shipment of livestock feed went awry when "hackers" intercepted and tweaked emails with payment details, eventually costing the cheeky buyers an extra $161,000 after exchange rates moved during the legal fallout. The sunflower meal traders ended up in dispute when the buyers refused to pay a shortfall caused by forex …
Is this really hacking or the exposure of poor business processes and a little social engineering? I make the distinction because hacking can usually be addressed by technical solutions/better technical solutions while poor process and social engineering can rarely be fixed with technology.
Having experienced the consequences of a number of similar situations (supplier sends details, someone outside of the expected supplier/intermediate/customer chain manages to become involved in an e-mail chain whether through hacking, type squatting or fraud on the part of someone in the legitimate supply chain and a payment almost gets sent to an unknown party. The scam relies on urgency and confusion and usually phone/e-mail conversations between finance people and fraudsters outside the main e-mail chain. While no incidents resulted in financial loss, a number came a lot closer than many people were prepared to admit.
Senior people not responding to queries or being unhelpful ("just get this done"), finance people being a little too helpful when details are unclear to help fill in information the fraudsters can't supply, and decisions being rushed when there is no real urgency (this needs paid in 48 hours but we can pay it in 4 hours with these details and we don't have to disturb senior manager X), and generally not having any methods in-place to verify suppliers (i.e. registered company information and third party supplier verification, processes to identify flags such as multiple bank accounts being supplied which then require further verification, clear organisation structures to allow new suppliers to be verified internally if key people aren't available).
So, Ecobank gets a free £94k for being weasels with the exchange rate? Why weren't they required to return exactly what they received, considering they are supposed to be an innocent bystander for whom the money was not intended? Can't see how they have any right to keep that residual - cf. various past cases of individuals receiving money accidentally, spending it, and then being ordered by the courts to pay it back.
“So, Ecobank gets a free £94k for being weasels with the exchange rate?”
Assuming Ecobank has just used market rates and a small transaction fee, why should Ecobank accept a customers risk of exchange rate fluctuations when the exchange rates are not set by Ecobank?
Put another way, if I give you US$100 today in exchange for £78 today because you were travelling to the US, would you give me US$100 in exchange for £78 in two weeks when you return? Even if my £78 was only worth US$95 and you need to purchase the US$?
Or are you feeling generous? Banks may be filled with weasels but they stick around long enough to do business. “Generous” banks tend to be exploited until they fail.
I would send you £78, which would be worth whatever it was worth when converted. The article says that they sent £93k less in the same currency they held it in. This may be a failing of the article, but as stated they have genuinely made a nice little profit.
I presume this was over the brexit vote, which is the only time I can think of with such serious movements in exchange rate in such a short period of time.
Bank charges on foreign exchange are never “small” unless the fees have been specifically negotiated in advance. It’s one of the many ways they swindle naive customers. They weigh the exchange rate by up to 10% in their favour and in many cases also add a transaction charge.
Those in the know use currency brokers to get much better rates.
Re the 10% on exchange rate. It can be higher than that. If you watch the exchange rate markets the variation of 'exchange rate' (volatility) is a factor on the % markup 'tourist rate' you tend to pay. If the pound is steadyish for a while the markup drops quite low so the money costs you not much more than the market rate. If the rate varies a lot then the supplier can be hit buying the money for you after you have paid for it so, like any well managed supply chain, the spot price is a lot higher than the market price. There's even good maths/stats to support it.
Is it not more silage these days? If the sunflower plant itself can be digested by the cattle then the whole crop is just cut down and chopped to a small size (so it flows and is easily handled) and fed to the cattle like that rather than piss about trying to extract the seeds. Near me farmers do the same with maize (fuck me that makes a mess) and my next door neighbour grew peas and barley together and that made a great silage - even it if was impossible to chase my escaped weaners through it thought it did look like salmon leaping through a green sea as they bounded through it!
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