No matter how many ways finance teams try to fight fraud, bad actors always devise new accounts receivable scams. According to the Association for Financial Professionals, 80% of organizations were the victims of payment fraud in 2023, and 30% of those were unsuccessful in recovering the lost funds.
Is it a losing battle? It doesn’t have to be. Even if you can’t stay on top of every new scam that emerges, there are some telltale signs that scams typically have in common.
3 ways to spot the signs of payment fraud
Fraudsters will try to scam payments in several different ways. Checks, for example, are a frequent target. Additionally, your organization may be a target of payment fraud in other ways, such as a fraudster intercepting your customers’ payments or the customers themselves being fraudsters.
- Watch for potential check fraud. Spot this with out-of-range or duplicate check numbers. Verify new bank accounts or account signers, and encourage customers to make online payments to reduce risks.
- Investigate customer claims that they’ve made payments. If a customer says they paid on time, verify how they paid. They may have used a fraudulent link.
- Verify the authenticity of new customers. Fraudsters may submit fraudulent payments after placing orders. Put steps in place to validate identities.
Be on the lookout for email scams
Business email compromise (BEC) is a common type of scam where fraudsters impersonate your company to trick others into changing payment info. Victims think they’ve paid — but the money goes to the scammer’s account.
- Make sure customers know how to identify your official emails. Streamline invoicing through portal processing to reduce BEC risk.
- Train your team to spot phishing. Watch for suspicious links and urgent action requests.
Keep track of what’s normal to detect unusual activity
Knowing what “normal” looks like for your customers helps you quickly catch scams. A sudden spike in orders or chargebacks may signal fraud.
Don’t forget about internal controls
Scams can happen inside your company too. Employees may fake invoices or misapply write-offs. Encourage dual controls and whistleblower support channels.
Technology can minimize risks
If your team must monitor everything manually, scams are more likely to slip through. Leverage AI and analytics to spot anomalies and unusual behavior at scale.
