Three firms have between them lost £2.5m to phone fraudsters in recent months, an insurer has revealed – suggesting that this represents only a small part of an epidemic of crime.

Office accounts as well as client accounts are being emptied by ‘incredibly clever’ callers posing as bank employees, Jason Smart, chief executive of professional indemnity insurer Elite, told the Gazette.

So-called ‘vishing’ frauds typically involve an individual phoning a firm’s cashier ‘to confirm recent transactions’. The cashier is lulled into giving out information such as challenge responses that the fraudsters use to empty bank accounts.

Smart warned that the callers are highly convincing, often with insider knowledge of banking procedures.

‘We’ve had claims adding up to £2.5m ourselves this year,’ he said, pointing out that Elite represents only 2.8% of the PII market. If his firm’s experience is representative, this suggests that the cost of this type of fraud is at least double the £40m figure generally quoted.

He said the golden rule for avoiding these frauds is that the person who takes the initial call should not deal with the query but take the name and number for someone else to call back.