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Treasury leads in discovering payments fraud

Sixty-five percent of respondents report that their organizations were victims of attempted or actual payments fraud activity in 2022, according to the 2023 AFP Payments Fraud and Control Survey, underwritten by J.P. Morgan.

Despite this figure being lower than the fraud reported in previous years, payments fraud remains a significant concern for treasury and finance professionals, with two out of three companies continuing to fall prey to fraudulent attacks, as per the AFP survey.

Cyber criminals are invariably a step ahead of corporations, and they rely on the weakest link in the chain of events leading up to payments fraud – your employees.

"We must remain vigilant in our training and innovation around payments fraud prevention to stay ahead of our adversaries”, said Jim Kaitz, President & CEO of the Association for Financial Professionals (AFP).

Strengthening one of the most crucial aspects of your defence – your personnel – to reduce the risk of corporate payment fraud by educating staff from various departments on prevalent fraud tactics and evolving cyber threats is central to cybercrime preparedness and outsmarting sophisticated cyber saboteurs.

While the treasurer is thought of as the superintendent of payment security, and the role of the corporate treasurer remains vital in taking the lead to educate interdepartmental staff on payments security and fraud prevention, treasury is also the department that is most likely to detect both attempted and successful payments fraud activity.

The latest AFP Payments Fraud and Control Survey shows that, as custodians of an organization’s cash, treasury has a key role to play in the fight against cybercrime, which includes safeguarding against payments fraud. The survey was conducted in January 2023 and received responses from 471 treasury practitioners from organizations of varying sizes representing a broad range of industries.

Treasury department most likely to uncover payments fraud

“Treasury (61 percent) is most likely to uncover both attempted and actual payments fraud activity, followed by Accounts Payable (47 percent)”, the AFP survey noted. This is not unexpected, since these two teams scrutinize and review payment transactions “most often”.

Source: 2023 AFP Payments Fraud and Control Survey

The Accounting/Controllers department (27%) also contributes to detecting both attempted and actual payment fraud cases. Although fraud detection is more prevalent in departments related to treasury and finance operations, other teams such as Accounts Receivable, Sales Operations, Audit, Procurement, and Human Resources also discovered instances of payments fraud.

To minimise potential payment fraud losses and mitigate other forms of damage, such as the loss of confidential information, corporations need to take steps to effectively halt fraud in its tracks. One of the measures to prevent payment fraud is to bear in mind that “Fraud never takes a day off, but it is important that people tasked with detecting fraud do; therefore, the payment approval and release process should expose any potential internal activity. It is often when employees go on vacation that internal fraud is discovered.”

Furthermore, “Creating an environment to support those in more junior ranks to question backup paperwork, approvals and the authority to question anomalies in processing is key to having a risk-mitigation mindset. Support from the senior ranks is important in this process, especially if a payment gets escalated because the proper process was not followed”, the survey recommends.

The AFP survey report also advocates for treasury teams to collaborate with other departments because employees in non-financial roles may “wait until the last minute to make critical payments for their businesses”, even as time-sensitive payments are usually managed by treasury.

Fraud detection in days, not weeks: a must for treasury and finance executives

“Treasury and finance practitioners need to ensure their systems can detect fraud occurrences within a few days rather than let the discovery take weeks or months”, counsels the latest AFP survey report.

Of the organizations that experienced fraudulent attacks and suffered actual losses last year, only four out of ten (42%) were able to uncover the fraud in less than a week, while 19% discovered the payment fraud within one to two weeks. An additional two weeks were required for 10% of organizations to realize that they had been targeted in an attack, and 13 percent took a month or more to identify fraudulent activity.

“For the roughly 30 percent or so that were unable to discover the fraud in a timely manner”, treasury and finance executives should be mindful of the fact that “The quicker the fraud is detected, the greater the chances of a recovery”. Only 27% of companies were able to successfully recover at least 75% of funds lost due to payments fraud in 2022, as per the AFP survey.

Organizations that have ongoing and specific payment fraud training ( for their employees, which is distinct from general cybersecurity training, will be able to detect and stop fraudulent payments faster than companies where the staff is inadequately trained. This will also reduce the costly impact of payment fraud losses.


Today’s criminals are constantly exploring and innovating to find new opportunities to commit payment fraud. This reinforces the need for focused payments security training to foster an informed workforce that will understand the growing complexity and will improve at preventing, detecting and responding to payment fraud. Such training will also help treasury maintain its leadership in an area where it is

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