Occupational fraud is on the rise: How to spot it and stop it | Medius
Here’s a statistic that will surprise you - only 12% of fraud activity is committed by prior offenders. This means that most fraud is committed by employees, many of whom have the trust of those around them.
With occupational fraud on the rise and 41.8% of fraud taking place within private businesses, your company is probably being defrauded right now.
Here’s what to look out for and how to stop it from happening to your business.
Scrutinize, scrutinize, scrutinize
As the saying goes, the devil’s in the details, and the fast-paced environment of the finance department is no exception.
You can help mitigate nefarious tricksters by doing your due diligence, starting with your vendors.
During the initial onboarding process, ensure that each vendor is vetted correctly. This includes mailing addresses, contact numbers, vendor tax identification numbers, points of contact, and bank accounts.
But it doesn’t stop there. You should prioritize checking the small print regularly to ensure nothing has changed - if it has, double-check with your point of contact, as this is where BEC fraud can capitalize.
You should also build ongoing data analysis via an Accounts Payable automation solution into your workflows. This will ensure that any unfamiliar bank accounts, transactions or countries are picked up and flagged before any money changes hands.
Most companies don’t realize that the average fraudster comes from within the company itself, with many holding roles for up to five years, as was the case with Vernon Beck, whose story you listen to on our Accounts Deceivable podcast.
This makes spotting fraud harder as they know exactly how to hide any inaccuracies and irregularities.
This is where a digital invoice solution comes in. It is fully customizable to your needs, including defining who has sign off - making it easier to spot fraudulent patterns before it’s too late.
Check it out
Last year an estimated 81% of US companies still used physical checks - that’s an overwhelming amount.
Physical check fraud can include: check grabs during transit, counterfeit and fake checks, and non-bank-issued check forgery.
A digitized system can significantly reduce this risk by allowing highly secure payments that prevent fraudsters from manually changing details
Accounts Payable Systems increases compliance
Poor compliance is music to a fraudster's ears. It allows them to fake invoices and even intercept emails, one of the reasons for the troubling increasing trend of BEC (Business Email Compromise).
AP automation cements your compliance, allowing you to streamline your payments channel and providing full transparency over the entire process, helping to significantly reduce the opportunities for details to be tampered with.
Cloud AP Automation software mitigates digital fraud
With 75% more cases of invoice fraud since the pandemic, it’s clear that hybrid and remote working has meant fraudulent activity has capitalized on less transparency over payment transactions.
That’s where Cloud AP Automation fits in. Providing you with a secure environment your employees can access from anywhere in the world, as well as providing you with full transparency and visibility of the whole process.
It means that finance teams can access real-time data and information and check for any irregularities, helping reduce the risk of your business being defrauded.
Get ready for AP automation with six simple steps.
The cost and effort to automate accounts payable are minimal compared to most digital transformation projects, and the benefits are nearly immediate for the entire organization. The decision to automate AP should be a no-brainer, but where do you start?
Follow the six steps in our Buyer’s Guide to AP Automation Solutions to build a solid business case that illustrates how you can help your business save time and money, reduce fraud and risk, increase visibility to data and cash flow, and more.
Getting the most from your AP data: tips for CFOs and finance professionals.