New data from the Association for Financial Professionals highlights a shift in how businesses are experiencing and responding to payments fraud. While the overall number of organizations targeted has declined from previous years, fraud remains a persistent threat, especially in traditional payment methods like checks. At the same time, the rise of electronic payments and commercial cards is changing the risk landscape, introducing new vulnerabilities alongside efficiency gains. The findings underscore a key reality for treasury teams: preventing fraud today requires both adopting modern payment methods and actively managing the risks that come with them.
The Association of Financial Professions (AFP) just released the results of the 2013 survey of payments fraud among its corporate members. The survey reports on incidence and types of fraud in business-to-business payment types. Respondents indicated that 61 percent of organizations were targeted in 2012, representing a 12 percent decline from the high point in the 2009 survey.
According to Jim Kaitz, CEO of AFP:
“Today’s corporate treasury professional takes proactive steps to combat fraud. Many organizations are transitioning to more electronic payment methods. They are aware of potential vulnerabilities. They engage in dialog with their key banks about fraud prevention.”
The survey revealed that 87 percent of affected organizations had their checks targeted, usually by non-employee outsiders, which supports the continued trend away from corporate use of checks for payment. The second most commonly targeted payment method was corporate/commercial purchasing cards, attacked in 29 percent of those organizations affected by fraud.
Interestingly, the survey also reports that in the case of corporate/commercial card fraud, unlike other methods, a significant amount of fraud (26 percent) is committed by an organization’s own employees. Commercial card program managers should take note; the card usage controls embedded in most commercial card management software will only work if they are properly implemented!
Click here to read more from the press release.
