Association for Financial Professionals (AFP) have released its yearly report and revealed payment fraud incidents reported in 2018 hit a record 82% for organisations.
The 2019 AFP Payments Fraud & Control Survey, underwritten by J.P. Morgan, accumulated more than 600 treasury and finance professionals in the survey.
AFP’s report found large organisations were particularly vulnerable to payments fraud; businesses with revenue greater than $1bn reported a jump of 7% year-over-year to 87%.
Organisations with revenue less than $1bn experienced fewer fraud attempts in 2018, down to 69% from 73%.
Overall, 43% of organisations experienced direct financial loss as a result of payments fraud.
“Payments fraud is a persistent problem that is only getting worse despite repeated warnings and educational outreach,” said AFP President and CEO, Jim Kaitz.
“Treasury and finance professionals need to learn the latest scams and educate themselves—and perhaps more importantly—their work colleagues on how to prevent them.”
One of the most noticeable aspects of the survey was the increase in business email compromise – 80% of companies reported BEC fraud last year, breaking the 77% record set in the year previous.
More than half (54%) of the organisations questioned reported financial losses as a result of BEC – acting as the first time since AFP began tracking this data that this number climbed above the 50-percent mark.
More than three-quarters of companies are responding by adopting stronger internal controls that prohibit payment initiation based on emails or other, less secure messaging systems.
Jessica Lupovici, Managing Director, J.P. Morgan, commented: “It is equally important for businesses to mitigate against non-financial implications of payments fraud.”
“Businesses stand to suffer reputational risk, which can be severe, expensive and require significant clean-up efforts.”
