The bill arrives a few days after your company purchases a domain name for a new service you’re launching. The invoice is an administrative fee for registering the new web address with the international domain name directory. While this document looks official and the amount requested seems feasible, it’s a scam. Is your company’s invoice management software robust enough to weed out these scams and solicitations?
Invoice scams have grown in skill and subtlety, according to a recent article on the Accounting Today website. It highlights three surprising facts about these new cons.
- Invoice fraud isn’t easy to detect. True, some scams are clumsy, but don’t think they’re all as easy to spot as misspelled emails soliciting wire transfers to Nigeria. The dollar amounts may be small enough to escape notice, and once that first bill makes it through invoice processing, the damage can accrue over years. Invoice scams are often large-scale operations and may include call centers and account collections that keep the money flowing.
- Small businesses aren’t the only target. While midsize and large organizations often have more rigorous accounts payable management, their complexity can make them just as vulnerable to fraud as a busy solo entrepreneur or small business.
- Invoice fraud isn’t necessarily illegal. According to Accounting Today, scams often use disclaimers and other fine print to stay on the right side of the law, tying the hands of law enforcement. The scammer may technically operate a real company and provide a real service or product — one that just happens to be worthless and misleading.
Businesses and organizations are largely on their own when it comes to preventing invoice fraud, Accounting Today reports. While government agencies, auditors and banks may offer advice and some resources, they tend to focus on pursuing identify theft and internal matters, like embezzlement.
In the end, an organization’s best defense against these scams is to implement a rigorous invoice management software system like Chrome River INVOICE. Such a platform offers clarity and transparency and uses automated business rules and approvals to guide intelligent and timely audit alerts.
Please share your experiences. What are the most obvious invoice scams you’ve encountered? What’s the most subtle scam your organization has spotted in time?
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Our choice of Chrome River EXPENSE was made in part due to the very user-friendly interface, easy configurability, and the clear commitment to impactful customer service – all aspects in which Chrome River was the clear winner. While Chrome River is not as large as some of the other vendors we considered, we found that to be a benefit and our due diligence showed that it could support us as well as any large players in the space, along with a personalized level of customer care.
We are excited to be able to enforce much more stringent compliance to our expense guidelines and significantly enhance our expense reporting and analytics. By automating these processes, we will be able to free up AP time formerly spent on manual administrative tasks, and enhance the role by being much more strategic.