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Travel & Expense Purchase Card

Oversight Releases Spend Analysis Report- T&E Fraud Linked to 5% of Program Travelers

on September 23, 2014

It’s here! Oversight has released its first-ever Spend Analysis Report, a compilation of data from 10 million transactions and over $1 Billion in spend from Oversight Insights On Demand™ customers for T&E.  The report highlights many of the bad behaviors lurking in travel programs namely: fraud, waste, and misuse.

Today we are going to talk about the “big one” - Fraud.

From our analysis of 10 million transactions, nearly 6% were flagged as potential violations to policy. The “potential” part of the sentence is important here, as exceptions to corporate travel policy happen every day, for a lot of reasons. Perhaps someone used the corporate card by accident, or needed to legitimately purchase something for work but it wasn’t compliant with existing company policy.

Still, it is important to note that of the 160,000 travelers we studied for our report, 11%, or 1 in 10 had multiple policy violations on their expense reports.

Why look for repeat offenders? So, we can establish a pattern of abuse. We’ve proven that most fraud committed in an organization is perpetrated by a small handful of employees. In our own data, we determined that it was only 5% of travelers in an organization making over 80% of the purchases flagged as potentially fraudulent.

T&E Fraud is often one of the largest indicators that fraudulent activity is happening elsewhere in the company. While this was outside of the scope of our own report, this statement is echoed in a recent report conducted by the ACFE. In their report, 75.6% of the cases involving expense reimbursement fraud also saw the same person engaged in at least one additional form of occupation fraud.

We’re not telling you this to scare you. In fact, while fraud is an issue in any corporate spending program, only 1% of the 10 million transactions we analyzed for this report were potentially fraudulent. We believe this number is low because data used for this report was compiled from customers who knew they were being watched. The Hawthorne Effect is very powerful, and we like to use it as a testament to the value our solution can provide.

There is more good news: it has never been easier to monitor 100% of transactions for potential fraud and non-compliant behavior. With statistics like these, don’t you want to know what is going on in your own T&E program?