Financial fraud is nothing new. As long as there have been honest businesses, there have been fraudsters out to scam them. Now, thanks to rapidly evolving technology, financial fraud is on the rise today. The FTC reported a 25% increase in consumer losses due to fraud from 2023 to 2024, and threats to businesses are rising just as swiftly.
CFOs now face more pressure than ever to identify and prevent fraud schemes. Fortunately, modern tech can help. By understanding some of the most harmful fraud schemes out there today and the risks they pose to finance departments, financial leaders can stay ahead of costly scams with tools like accounts payable automation. With a better handle on fraud, CFOs can shift their focus to driving strategy and guiding business growth. Here’s what you need to know.
New Tech, Same Threats: Current Fraud Schemes To Look Out For
The basic anatomy of a financial scam hasn’t changed much in the last century or so: A fraudster impersonates someone trustworthy, convincing a consumer or employee to give them money. Unfortunately, AI and deepfake technology have made classic schemes more convincing than ever. This is as true for businesses as it is for individual consumers.
Understanding the specific forms these threats take today can help businesses respond more effectively.
Invoice Fraud
Scammers use digital technology to create false invoices that are almost indistinguishable from real ones. This can be financially devastating for businesses that rely on manual invoice review. In fact, the Forbes Finance Council estimates the average cost of invoice fraud for a middle-market business to be $280,000 per year.
Business Email Compromise
Fraudsters target internal communication channels, gaining access to or mimicking company email addresses. By posing as executives or colleagues, they can slip past normal defenses and request wire transfers, sensitive data, or payment approvals. These messages often arrive with a sense of urgency, making them more likely to succeed before anyone thinks to verify.
Fake Vendor Schemes
External impersonation is just as dangerous. Scammers pose as legitimate vendors or suppliers, often claiming a change in banking information or ownership. Without robust verification protocols, finance teams may unknowingly reroute large payments to fraudulent accounts—especially if the request appears routine.
Fraudsters Are Evolving
These schemes sound deceptively simple because they are. It’s the quality of the impersonation, not the complexity of the scam, that makes fraud so hard to spot.
Fraudsters today can use AI to enhance their deceptions, crafting fake invoices that look just like the real thing or mimicking the conversational tone of emails between coworkers. AI also powers sophisticated deepfakes. That means scammers can make voice or even video calls impersonating a vendor, company leader, or coworker to urgently demand funds.
More than just being spooky, these attacks are dangerous. They exploit the trust between coworkers and create a false sense of urgency to convince financial professionals to overlook any inconsistencies that might raise red flags.
How More Sophisticated Fraud Impacts Finance Departments
You may think your financial teams are “too smart” or “too careful” to fall for a scam. But fraud is becoming more advanced, and the impacts cannot be understated. Just look at the example of Arup, the UK-based engineering group that lost $25 million in a deepfake scam when a fraudster used AI to impersonate the group’s CFO.
Spotting and preventing fraud requires more resources than ever before. However, finance teams don’t have the budget and human resources to spare, especially if they are still relying on manual processes. The tools financial professionals have historically relied on, such as emails and spreadsheets, are now extra vulnerable, and teams are spread too thin to diligently review every potential threat.
Spotting Scams Before They Start: The Power of AP Automation
Fraudsters are evolving, and businesses’ defense systems must evolve to keep up. One of the best tools in a finance team’s arsenal is AP automation.
Automation doesn’t just make AP processes easier—it helps identify and quash fraud schemes before they start. AI-powered anomaly detection catches details that manual review processes might miss, such as invoice amounts that are higher than usual. Automation also helps to streamline workflows and establishes role-based permissions, so that oversight of the entire payment process is never left to a single employee.
Real-time visibility, full audit trails, duplicate invoice detection, and vendor validation are all critical fraud-prevention tasks that automation takes off the hands of overburdened staff.
Reducing Human Errors
A common misconception about AI automation is that it replaces human workers. In reality, it streamlines human-powered work, freeing up finance teams to focus on insight, strategy, and building sustainable growth.
When it comes to AP, automation prevents common human mistakes that leave finance departments vulnerable to fraud and non-compliance, including:
- Data entry mistakes
- Duplicate payments
- Missed approvals
- Skipped steps in AP workflows
Future-Proofing Fraud Protection
You may have manual processes in place to prevent some of the most common schemes today, but financial fraud is only growing more complex. AI technology is not going anywhere, and deepfakes grow more realistic by the day. Modern CFOs need a scalable, intelligent framework that will adapt to each new threat.
The solution is AP automation. With the best software, you’ll get built-in features designed to detect potential scams and alert your team. Automation tools are scalable to grow with your business without overburdening your staff, and will continue to evolve as fraudsters develop new, more advanced tricks each year.
Stay Ahead of Evolving Frauds With AP Automation
Evolving technology is often at the root of financial fraud, but it’s also the most effective solution. The smartest move today’s CFOs can make is to adopt scalable, AI-powered software that reduces human error, spots scams before they start, and sets the stage for more resilient operations.
In addition to defending against fraud, the best AP automation tools prepare finance teams for the future. With real-time visibility, anomaly detection, and regulated workflows, teams can streamline operations, stay compliant, and build a foundation for smart growth.
By automating accounts payable, your finance team gains the time and confidence to shift from being reactive administrators to proactive strategic partners, helping the company make better decisions and plan ahead.
Don’t wait for the next scam to disrupt your business. Get ahead of fraudsters and unlock smarter, future-ready finance with AP automation today.
