Payments Fraud Lowest since 2004, says AFP

Last year, we reported the results of AFP's 2011 Payments Fraud and Control Survey. AFP's 2012 Study shows that not only was the incidence of fraud in 2011 the lowest it has been since 2004, but it has actually declined over the past two years. Checks continue to be the dominant payment form targeted by fraudsters. Highlights of the survey:

  • The majority of organizations - two thirds - experienced attempted or actual payments fraud (this is down from 71% the previous year).
  • 85% of affected organizations reporting that their checks had been targeted (down from 93% last year). The second most affected payment method was ACH, at 23%.
  • Most organizations that were subject to at least one fraud attempt did not suffer actual losses. But those that did suffer a financial loss, lost an average of $19,200 (up from $18,400).

The data suggest that treasury's efforts to mitigate fraud risk may be paying off. It also suggests that fraudsters have shifted their focus to higher-value payoffs, i.e., big companies that handle many checks. Large organizations, especially those with a large number of payment accounts, are far more likely to be targets of payments fraud than smaller ones and typically incur higher average losses. Regardless, it is critical for all treasury professionals to remain vigilant against fraud. Perhaps your organization, like 74% of others, maintains separate accounts for different payment types as a way to increase account control.

Are you taking advantage of features an automated payment processing solution can offer? Our ExpertRPS remittance processing solution has many features to minimize your risk:

  • Cash Only Client Review – to ensure named accounts pay by cash only
  • Check 21 - the fastest way to deposit and clear checks
  • High Dollar Review - to catch items over a user-defined threshold
  • Hot Files- to review/reject payments based on your business rules
  • Image Quality Review - to filter out questionable items

Contact us for more information on these or other custom features to help your fight against fraud.