The 2018 AFP Payments Fraud Survey, underwritten by J.P. Morgan, revealed that payments fraud reached a new high in 2017 after a downswing earlier in the decade. A record 78% of all organizations were hit by payments fraud last year, according to the survey of nearly 700 treasury and finance professionals.
Checks continue to be the subject of more fraud than any other payment method, with 74% of respondents reporting this form of attack. Wire fraud followed at 48 percent, while corporate card fraud ranked third at 30%.
Business email compromise (BEC) played a major role in payments fraud in 2017, with 77 percent of organizations experiencing BEC in 2017. Additionally, 54% of BEC scams targeted wires, followed by checks at 34%. The good news is that 77% of organizations have implemented controls to prevent BEC scams.
“It is alarming that the rate of payments fraud has reached a record high despite repeated warnings,” says AFP President and CEO Jim Kaitz. “In addition to being extremely vigilant, treasury and finance professionals will need to anticipate scams and be prepared to deter these attacks.”
Other highlights of the 2018 AFP Payments Fraud and Control Survey include:
- 65% of payments fraud is committed by individuals outside the organization
- 67% of payments fraud is discovered by treasury staff
- 92% of organizations report that payments fraud attacks collectively cost 0.5% of the organization’s annual revenue
- 47% of organizations discovered fraud less than two weeks after the incident occurred
“The fraud survey serves as an important resource in understanding the potential risks within the payments industry,” continues Bob St Jean, Managing Director and Treasury Services Executive at J.P. Morgan.
“With more than three-quarters of companies experiencing fraud in 2017, it is important that businesses take preventive measures by educating their employees and implementing processes to prepare and protect their infrastructures from cyberfraud.”
Full survey results are available here.