Companies lack framework to prevent payment fraud

payment fraud

A global survey of corporations that received more than 300 responses found that 57% of respondents admitted to having no formal framework in place to protect their organisations from payment fraud.

According to the 2016 Global Treasury Fraud & Controls Survey, conducted by risk consulting and analysis firm Strategic Treasurer and underwritten by software vendor Bottomline Technologies, payment fraud attacks are on the rise in terms of both frequency and sophistication. It was conducted during the first quarter of 2016 across North America; Europe, the Middle East and Africa (EMEA) and Asia Pacific.

While historically, cheque fraud has been extremely easy to perpetrate, the survey responses suggest that companies are also now experiencing a rise in wire fraud. One in four companies that responded to the survey indicated that they have experienced loss due to this type of attack.

“This research is of great value to corporate treasurers across the globe,” said Craig Jeffery, managing partner at Strategic Treasurer. “While many have heard of the recent high profile attacks, for most, their vulnerability to fraud has not been analysed at the level of detail required.

“This survey clearly demonstrates the seriousness and reach of the growing payment fraud issue. For attackers, crime is paying off and the lack of protection surrounding their targets has brought about an escalation in their assault. We want to ensure that companies truly understand the magnitude of this threat and the risk implications so that they can take the necessary steps to proactively guard against attack across all areas of risk.”

The survey highlights practical insight on how companies are, or should be, protecting themselves across the areas of an overall control framework that includes process controls, reconciliation and visibility, payment workflows and processes, and technology investment.

“A ‘band aid’ approach isn’t a viable fraud protection model,” added Gareth Priest, vice president of business solutions at Bottomline Technologies. “Companies need to have the right mind-set when it comes to fraud protection.

“It’s recognising that you will have to make changes, developing a global strategy, and then making the right investments; an ad-hoc approach will not provide the protection needed.”

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