Consulting Services Detecting Purchasing Card Fraud
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Purchasing and company credit cards, sometimes referred to as p-cards, are used by agencies and organizations in various industries to assist with managing high volumes of transactions, reduce fees and costs, and expedite urgent purchases. Purchases may include travel, equipment, emergencies, office supplies, and large dollar items, just to name a few.  While p-cards offer many benefits, they are not without risk for abuse and/or fraudulent misuse.

P-card fraud is a billing sub-scheme that falls under fraudulent disbursements within the asset misappropriation category of the Fraud Tree. According to the Association of Certified Fraud Examiners (ACFE) 2018 Report to the Nations, the departments with the highest percentage of billing schemes are administrative support, executive/upper management, and the accounting department.

In addition to the common behavioral traits or warning signs associated with fraud, the following are some red flags to be aware of related to p-card fraud:

  • Missing receipts
  • Non-itemized receipts
  • Similarly formatted receipts
  • Delayed submission of reconciliations
  • Non-prime or unusual vendors

Beyond an awareness of red flags, data analytics can be a powerful tool to monitor and detect misuse or the occurrence of fraud. Furthermore, because of the amount of readily available data associated with purchasing cards, data analytics can be easily run on your organizations p-card transactions. The following are some examples of data analytics to detect potential p-card misuse or fraud:

  • Unapproved merchants, if merchant category code (MCC) restrictions are not implemented
  • Round number transactions
  • Split transactions
  • Transactions outside of normal business hours or occurring on holidays
  • Seasonal purchases
  • Frequent near-limit purchases
  • High-spend vendors and high-spend employees

Does your organization need assistance analyzing your purchasing or company credit card data? P&N has a depth of resources to help prevent, investigate and analyze fraud perpetration. Contact us today to find out how we can help.

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