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Article Excerpt
Affecting nearly every organization, T&E fraud occurs more frequently and costs more money than ever before, according to the Association of Certified Fraud Examiners.
From the traveler who eats a $5 meal at McDonald's yet files an expense report for a fictional $200 dinner at Morton's, to Tyco chief Dennis Kozlowski's infamous $6,000 shower curtain (reportedly purchased with company funds and filed on an expense report), T&E fraud is alive, well and--despite a climate that would warrant more vigilance against such corporate ills--growing.
"We've seen the overall cost of fraud grow by 50 percent since our previous report," said ACFE president Toby Bishop. Release late last year, ACFE's most recent report on corporate fraud abuses--which examines everything from skimming and cash larceny to corruption schemes--found that occurrences of expense reporting fraud comprised 12 percent of all corporate fraud cases, up from 7 percent in 1996, when the previous ACFE report was issued. Likewise, the cost of T&E fraud has grown 200 percent, exceeding the growth of other types of corporate fraud. In 1996, the average cost to a company of an expense reimbursement scheme was $20,000. The average expense reimbursement scheme now costs a company $60,000, lasting on average two years before detection.
"Companies have downsized in recent years, as a result of which most supervision and review has been...
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