Travel expenses are most common internal fraud

Internal fraud, especially in relation to business travels, is a big problem for companies of all sizes, new report by Captio says.

The business travel expense management platform analysed expense reports sheets by 130 companies during 2015, including 1.3 million professional travel expenses corresponding to 6,070 corporate travellers.

From that 1.3 million, 12.8 per cent are potentially fraudulent, with small and medium-sized buinesses getting the highest number of such expenses (13 per cent). In large companies, the figure sits at 10 per cent.

Breaking the numbers down, the company says claiming old expenses as new ones is the most common act of misconduct in Spanish companies (33 per cent). Claiming several expenses using the same receipt was placed second (29 per cent), followed by generating expenses during the weekend (12 per cent), even though their business is Monday to Friday.

The most obvious impact is the financial one – EU companies lose, on average, £27,032 annualy. Small businesses lose £33,063 pounds per year, while large companies lose £22,304.11 every year.

“We believe that a lack of expense management tools and policies in SMEs is the reason that they are the victims of a greater level of fraud”, explains Joaquim Segura, CRO and co-founder of Captio.

The company breaks these frauds down into three categories: fraud based on the amount claimed, receipt-based fraud and illegitimate claims on the date.

The full report, entitled ‘The cost of internal fraud in the expense management of European companies’, can be found on this link.