RECENT AFP STUDY SHOWS PAYMENTS FRAUD IS AN INCREASING PROBLEM
Decreasing by only 1% since last year, the 2020 Association of Financial Professionals Payments Fraud and Control Survey Report shows payments fraud remained consistent, with 81% of companies reporting they were targets. Perhaps more alarming is most of the payments fraud attempts/attacks came in the form of Business Email Compromise (BEC). It’s critical now more than ever that businesses put processes and controls in place to help mitigate risk.
Targets of Attempted and/or Actual Payments Fraud Trends
With 42% of businesses reporting their B2B payments are made by check, it’s no surprise that checks are targeted most frequently. Overall, fraud payment types include:
While 54% of organizations report potential financial loss of less than $50,000, the exposure of confidential company and/or client information is becoming a greater concern. Good news is, companies are discovering fraud much quicker, with 80% detecting it within one month.
Business Email Compromise: A Growing Problem
Becoming the leading source for the first time, Business Email Compromise (BEC) was experienced by 75% of reporting organizations, with 61% reporting it as the most common source of payments fraud attempts.
BEC is a scam targeting business’ payment processes. Essentially, a fraudster takes over valid business email accounts through social engineering or computer intrusion techniques to process unauthorized transfers of funds. The individual responsible for processing payments is tricked into thinking the request is valid, coming from a company leader, partner or third-party vendor, and processes the payment.
Payment Methods Impacted by BEC
Using Tools, Resources and Education to Help Mitigate Fraud Risk
Implementing protective measures and processes can help reduce a company’s risk of being the next target. Employee education and training, paired with available tools and resources can be extremely valuable. Organizations reported the following practices help reduce risk:
Company Fraud Policy
Safeguarding with Additional Protective Measures on Accounts
Payments fraud can be reduced, if not avoided completely, by understanding the prevalence and threat of fraud, and recognizing prevention as an ongoing, critical business strategy. Financial products, services, and fraud prevention tools and resources are available. Don’t allow your business to be the next target – contact us today!
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