#APautomationsoftware automatedinvoiceprocessingsoftware AccountsPayable Invoiceautomation accountspayable automationsoftware accountspayable

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[hermes-ap-automation]

How Can Accounts Payable Automation Protect You from Fraud?

Protecting the accounts payable process from fraud is a massive concern for businesses across the globe. Every year, companies lose millions of funds due to fraudulent activity. Investing in an accounts payable automation solution can help protect your business against fraud. 

An AP automation system streamlines and automates the accounts payable process end-to-end. This system can help prevent fraud by taking manual labor out of the process. Businesses can reduce the chances of fraudulent activity by automating the overall accounts payable process.  

The accounts payable automation process can provide businesses with additional security measures. For example, it can set up rules and validation checks to alert a company when any invoice detail seems suspicious. It can be beneficial for detecting and preventing fraudulent activity.  

Another benefit of accounts payable automation is that it can provide businesses with better visibility into their accounts payable process. By automating the overall AP process, companies can easily track and audit invoices, payments, and other related information. It can help detect suspicious activity and enable businesses to combat fraud more effectively.  

Accounts payable automation can help protect businesses from fraud by giving them better control over the process. It includes adequate control over who can access the system and who can approve and disburse the payments.  

What Kinds of Accounts Payable Fraud Are Most Common?  

Every year, accounts payable fraud affects thousands of businesses, both big and small. It is because of several things, including how simple it is to commit fraud using conventional AP procedures and fraudsters' growing sophistication. Most of the time, AP fraud is carried out right in front of businesses, frequently with their collaboration.  

The most common kinds of AP fraud are as follows:

Billing Plans Fraud - These schemes can range in sophistication and are frequently carried out by employees or with their knowledge. 

For instance, a worker might create a     false invoice and 'pay' it for goods or services. 

Another option is for an AP employee to     double-pay an invoice by mailing two cheques of an invoice to the same     vendor. Before the arrival of the second cheque, AP calls the vendor to     inform them that they accidentally sent two cheques and requests that they     send one back to a specific address or office location for a particular AP     employee. 

Another scenario is a self-written   cheque or wiring the funds to a personal bank account since this AP person     is an authorized signer. The individual acting as the vendor encashes the  cheque directly from the bank. 

Verify Fraud  

According to a recent market study, cheque-related fraud affected over three-quarters of all businesses affected by AP fraud. Writing checks from a business account for personal expenses or changing the amount in the cheque are examples of fraud.  

ACH Fraud  

When someone (often an employee of the company or a hacker) gains access to funds through an automated clearing house to process electronic fund transfers, this is known as ACH payment fraud. The employee or fraudster may use a keylogger or other method to access the files.  

Once they can access the files, the fraudster may commit vendor impersonation fraud (VIF). It happens when a fraudster alters the profile of an existing vendor to direct legitimate payments to their account.  

·       Expense Reimbursement Fraud

Fraud in Expense Reimbursement Frauds is tricky to find and frequently go undetected for years. These kinds of scams can happen when an employee uses a personal credit card to make purchases and submits an expense report, overstate their expenses, deliberately offer duplicate accounts, or fabricate expenses for goods they have never bought. Even though the sums may appear small initially, they will eventually add up if the fraud is unnoticed.  

Kickback Plans Fraud

Due to insider assistance and protocol-breaking, kickback schemes are among the most harmful forms of fraud. These frauds occur when a third party pays a worker to influence business decisions, like choosing a vendor. As a result, rather than considering what is best for your customers, critical business decisions are made based on who can line the pockets of one of your own. Later on, it might also give rise to other types of fraud, like billing schemes.  

AP Fraud Prevention and Detection  

The main issue with AP fraud is that it is difficult to detect without structural changes to business processes. Protecting your business's and your employees' future may be time-consuming and frustrating, but changing policies and implementing new safeguards is worth the effort. 

Utilize Automation and Machine Learning 

The overwhelming day-to-day details of running a business make it extremely difficult to spot mistakes and patterns, which is why fraud typically happens. For instance, employees who process hundreds of monthly payments frequently need more time to search for designs or double-check changes.  

To protect your AP processes from fraud, you need to streamline and automate the overall process so that the software can track and detect fraud using the latest technologies. The software will raise exceptions whenever an issue occurs. Those exceptions will get processed after a manual review from an authorized user. By automating your end-to-end AP process using secured AP automation software, you can protect your overall AP process from various fraud techniques.

Hermes - AP automation helps centralize communications and automate the AP process, making it much simpler to spot fraud. It uses AI and machine learning technologies to detect fraud. By highlighting suspicious changes, the AP automation tool assists businesses in streamlining the overall AP procedure and prevents fraud. They pay attention to small details and commit human mistakes. Hermes AP automation software follows all rules and regulations under SOC 1 Type 1 compliance.

Our Machine Learning algorithm detects duplicate invoices, tracks vendor changes, and identifies suspicious trends. By utilizing Hermes – AP automation, you can concentrate on managing other priorities of your business while our software monitors the specifics that might make you vulnerable to AP fraud. 

Conclusion 

Businesses can benefit from using accounts payable automation processes to safeguard themselves against any type of Accounts Payable fraud. Companies can reduce the possibility of fraud by streamlining the end-to-end procedure using secured AP invoice automation software like Hermes. Investing in an automated AP software like Hermes for tracking and paying bills is a wise move that can help safeguard your company from fraud and save you from losing money.