How the Pandemic has Increased the Risk of Payment Fraud

The operational disruption caused by the sudden shift to remote working is raising the risk of payment fraud in the eyes of accounts payable leaders.

That’s according to the results of a survey conducted last month during an online event organized by the Institute of Finance and Management (IOFM).

Most of the accounts payable leaders surveyed believe that their organization’s risk of payment fraud has increased since the start of the pandemic.

14% of leaders surveyed fear that their organization is at “significantly” higher risk of payment fraud.

The sudden shift to remote working disrupted established processes and procedures for paying suppliers. In some cases, organizations have been forced to choose between hardened checks and balances and getting their supplier paid to avoid supply chain disruption.

As a result, the Federal Bureau of Investigations (FBI), the Internal Revenue Service (IRS), and Interpol report that there has been a significant spike in phishing schemes and Business E-mail Compromise (BEC) attacks over the past year.

Fraudsters see an opportunity to take advantage of new ways of working.

68% of the AP leaders, report that their organization has been the victim of attempted or actual payment fraud since the start of the pandemic. Nearly 1-in-5 AP leaders admitted that their organization has experienced attempted or actual check fraud 3 or more times over the past year.

Unfortunately, few accounts payable departments have all the technology they need for mitigating payment fraud.

From the AP leaders, surveyed by IOFM:

11% described their department as having a high level of automation for preventing fraud.

39% admit that their department has little or no automation for mitigating payment fraud.

59% said their organization plans to deploy more fraud-mitigating technology.

Mitigate Your Risk of Payment Fraud

Our electronic payments solution include a bank-grade security infrastructure and built-in tools for validating the identity of trading partners.