Scammers bilk Orion of $60 million

Luxembourg-based carbon black giant Orion has made a Form 8-K filing with the US Securities & Exchange Commission (SEC) stating that it expects to record a one-time pre-tax charge of about $60 million. This is apparently the result of a wire fraud scheme, though this was not explicitly spelled out.

The company said that on 10 August, an employee who was not a named executive officer “was the target of a criminal scheme that resulted in multiple fraudulently induced outbound wire transfers to accounts controlled by unknown third parties”. There was no break-in into its systems or data breach.

“To date, the company has not found any evidence of additional fraudulent activity and currently does not believe the incident resulted in any unauthorised access to data or systems maintained by the company,” the filing continued. “However, the company’s investigation into the incident and its impacts on the company, including its internal controls, remains ongoing.”

Frauds like this typically involve using an email address with a slight variation on a known and trusted one to which large money transfers are regularly authorised. They let to total adjusted losses of $2.9 billion in the US in 2023. The loss is not expected to do Orion any serious damage as it recently projected net sales of $382-415 million on net sales of $1.46-1.54 billion in 1H.