A recent survey by the Association for Financial Professionals (AFP) found that 61 percent of organizations experienced actual or attempted payments fraud in 2012. One example of payments fraud: a criminal manages to print what appear to be legitimate paper checks and then finds clever ways to get them cashed. The 2013 AFP Payments Fraud and Control Survey states that the incidence of payments fraud declined for a third straight year. Still, the AFP urges treasurers and cash managers to stay on high alert. This is the ninth year that AFP has conducted this survey.
Fraudsters are evolving their techniques to stay in step with companies that are moving more of their disbursement load to electronic platforms and purchasing cards. Nancy McDonnell, managing director of J.P. Morgan Treasury Services, the research sponsor, warned: “organizations must remain vigilant since fraudsters are constantly exploring newer and bolder ways to perpetrate fraud as payments options continue to evolve.”
For all sizes of companies, the typical fraudster was an outsider acting alone, rather than an employee, affiliate, organized crime ring, or a compromised piece of technology. In the case of corporate/commercial card fraud, however, it is important to note that a significant amount of fraud (26 percent) is committed by an organization’s own employees.
Background on the survey: In January, AFP sent the survey to more than 5,000 of its corporate practitioner members. The result: 625 responses.