The Surprising Truth About Expenses Fraud

A special supplement to The Times published this week, Fighting Fraud, sounds an uncomfortable alarm for many of us in business: fraudsters are making millions and there’s no sign of that stopping.

But the supplement also provides a wealth of tips for finance leaders on how to combat fraud, including:

  • an overview of methods fraudsters employ to wreak financial havoc,
  • strategies to ensure your company’s cyber security, and
  • tactics to secure your company’s ecommerce transactions.

When it comes to employee expenses, the vast majority of claimants are honest, however fraud still happens. And a YouGov survey we commissioned revealed a surprising breach in the expenses fraud armour: it turns out that less than 1% of employee expense claims are ever rejected by a manager.

Saying “no” is usually difficult in any context, but clearly when managers are confronted by employees bent on fiddling their expense claims, managers find it difficult to confront the problem alone. Here is the advice we give our customers on the subject:

  • Don’t be afraid to challenge suspicious-looking claims.
  • Conduct regular expense reviews and sampling.
  • Maintain a consistent and public procedure to deal with “wrong-doers.”
  • Don’t make assumptions that seniority/length of service will make people more or less inclined to fiddle expenses.
  • Outsource expenses auditing to an independent third-party who can more easily identify out-of-policy expenses.
  • Don’t over rely on IT – make sure manual checks take place, too.
  • Check the checkers.

More help is available in our popular e-book, Expenses Fraud Demystified, which contains definitions, resources, research and solutions to help you identify expenses fraud if you think it’s happening, and manage it. Or even if it isn’t, this book will give you some red flags to look out for.

If the statistics published this week in The Times are right, the odds are likely that fraud will be something you may need to confront in the future. We hope these two resources will help you be ready so there’s as little impact to your business as possible.

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