Partner Article

January is a fraud hotspot

The Forensic & Litigation Support Services (F&LSS) team at advisory and restructuring firm Zolfo Cooper has today warned businesses to be more vigilant against false invoices and inflated expense forms in January.

January has been found to be one of the calendar ‘hotspots’ for fraud as people struggle to make ends meet after the Christmas spending season. The F&LSS team has noted an increased risk in the number of false invoices, fraudulent expense claims and underhand payments being submitted in companies across the country.

Paul Huck, F&LSS Director at Zolfo Cooper says:

“At various points throughout the year cases of fraud and fraud risk rise due to increased pressure on people’s bank balances. January is a prime time for this, initially due to the excess of Christmas but also because it is a ‘long month’, with workers often going up to six weeks between pay cheques, as many firms pay employees early pre Christmas.

“Companies therefore need to be more cautious when approving requests and putting through invoices to ensure they are not unwittingly approving fraudulent claims.

“At F&LSS we see examples of this type of crime throughout the year, but the risk usually increases around calendar ‘hotspots’ such as post Christmas January, pre Christmas December, and over the summer holidays.

“However, this does not mean that employers can afford to be less alert to this type of fraud in other months. In February for example, payments for credit card purchases made in the January sales will start becoming due.”

Huck continues:

“With ‘small’ acts like adding a zero to a taxi fare, or charging back a non-work related lunch, we’ve found, rather worryingly, that some employees don’t realise they are even committing a fraud.

“As the employees reach a higher level, however, so too does the severity of the crimes they are executing. In some cases, senior members of firms who are subject to less scrutiny can, over a long period of time, end up committing fraud against their employers for amounts in excess of £100,000. It is therefore paramount for companies to take these internal threats seriously, putting in place a robust system to check all invoices and claims they receive, regardless of whether they are small or large. Fraud is fraud, no matter how big the sum in question.”

This was posted in Bdaily's Members' News section by Rostrum Communications .