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Travel and subsistence fraud

It refers to the fictitious bills related to expenses made by employees or business partners. In such frauds, the workers often overstate the costs related to travel activities and may submit false claims to get refunds. Many organisations do not provide such claims because they find it difficult to identify or audit forged bills. 

It can be some high-risk transactions where the employee manipulates the expenses and may indulge in unauthorised trips for personal benefits or claim funds that infringe the policies and procedures of the firm, like trying to get refunds for personal amenities or alcohol that may be prohibited. 

Some of the different ways the employees claim the bills are- 

  • They may try to get refunds for buying items like groceries or hotel stays – that are not permitted.

  • They give bills against goods or services they never purchased, like cancelled flight tickets, registration fees, etc.

  • They opt for expensive travelling options like hiring a limousine instead of a cab.

  • They offer fake receipts and inflate the mileage. 

  • They fill in excess claims for meals or entertainment compared to the allowed limit.

  • They may add tips to reimbursements.

How To Prevent It?

  • Organisations should adopt strict policies. For example - they should maintain travel guidelines and educate employees about the policies.

  • Always conduct a review of employees’ bills. Seek original documents and reports for audit purposes.

  • Always question the expenses when they appear extraordinary.

  • Businesses should have a formal model of disbursement that happens through a monitored payroll system. 

  • Implement the policies related to corporate charge cards and receive credit activity reports every month from the employees. 

  • Impose strict penalties for offenders.

Date Published: Sep 18, 2023

Types of fraud

A-Z of fraud

To help understand which fraud you've been affected by, we've categorised them into an alphabetical list.

What is fraud and cyber crime?

Cybercrimes can be of two types. First, it can be cyber dependent, where the fraudsters use online devices to convince the victim to accept their offers.

Advance fee fraud

If you are trying to get a loan for a house or a car, they ask to meet the provider to get the financing arrangement and pay the finder's fee in advance.

Corporate fraud

Corporate frauds can be complicated, committed either by the firm or an individual. Nevertheless, it mostly involves cheating where the employee or the firm.

Individual fraud

There are many types of individual frauds related to advance fees, investments, insurance brokers, bogus tradespeople, Ponzi schemes, pension liberation.

Online fraud

Hence the number of cases of online fraud is increasing each year, and most such cases include – account takeover, direct frauds, or scams related domain names.

Identity fraud and identity theft

The criminal uses the stolen identity of another person living or deceased to conduct unlawful activities like obtaining goods or services in another's name.

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