Recent invoice fraud statistics:
- UK businesses lose around £9 billion annually because of invoice fraud
- 43% of businesses are unaware of the existence of invoice fraud
- There were 3,280 invoice and bank mandate scam cases involving businesses over the year, with an average loss per case of more than £28,000.
Financial Fraud Action UK has warned companies to "check twice, or pay the price!"
How to protect your company from invoice fraud
- Establish at least two designated points of contact with all your regular suppliers - and contact them in the event of all invoice queries.
- Always check any change of bank account or payment arrangements directly with the supplier - but only use the contact information you have on file to do this. Don't call named people on an unsolicited letter or email.
- Don't be pressured - into processing payment without carrying out checks. Fraudsters may try to inject urgency - for example, by threatening late delivery or some other negative impact on your business. Don't be fooled by this. A genuine supplier will understand the need for vigilance.
- Carefully scrutinise all invoices you receive - there may be subtle but noticeable differences - such as misspellings, a blurred logo or one with slightly different colours; the inclusion of bank details where none had been stated previously; a different email address with small changes (.com or .org instead of .co.uk); a new signatory; changes in the amount invoiced; changes in the method used to request payment; a different contact name or phone number for correspondence, etc. Train yourself and others to spot the signs.
- For substantial payments, insist on meeting or talking to a designated point of contact first - so you're sure that the right account is credited.
- Always send confirmation - let suppliers know when you've made payment and what account you've credited by sending a confirmation email to designated contacts.
- Think security before publishing details of your suppliers online - while transparency is a good thing, by advertising who supplies goods and services, you're making it easy for fraudsters. Is it really necessary to publish their names so openly?
- Maintain confidentiality - don't leave invoices on your desk or screen unattended and never in public view.
- Consider whether other measures might help prevent supplier invoice fraud - e.g. QR codes or barcodes, etc.
- Reconcile accounts regularly - so potential fraud is detected more quickly.
Want to learn more about Fraud?
We’ve created a comprehensive AML & CTF roadmap to help you navigate the compliance landscape, supported by several financial crime prevention courses in our Essentials Library.
We also have 100+ free compliance training aids, including assessments, best practice guides, checklists, desk aids, eBooks, games, posters, training presentations and even e-learning modules!
Finally, the SkillcastConnect community provides a unique opportunity to network with other compliance professionals in a vendor-free environment, priority access to our free online learning portal and other exclusive benefits.