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Hot on the heels of the discovery that many small businesses don’t claim sub-£10 expenses comes news that they’re also losing money on fraudulent invoices.

SMEs Losing £9bn A Year

Tungsten, an e-invoicing, invoice financing and analytics company, surveyed over 1000 UK SMEs and concluded that companies of this size lose £9bn every year to invoice fraud in the UK.

The report found that nearly half (47%) of the responding companies had received a fraudulent or suspicious invoice in the last year, with 54% identifying it as their single biggest threat.

However, even though one in six SMES believed that fraud invoice had cost them in excess of £5,000 in the last year, only 44% say they would contact the police or Action Fraud if they received a fraudulent invoice, while 13% admitted to being unsure what they should do if they received one.

 

Tricks of the Invoice Fraud Trade

So how are fraudulent invoices issued? How do they go undetected – and what harm can they do?

 

Protecting Your Business from Invoice Fraud

“UK small businesses face all manner of challenges, and it’s telling that cyber-crime looms as one of the biggest, “ says Tungsten’s CEO, Richard Hurwitz. “What’s most troubling is that it needn’t be like this as there are steps companies can take to protect themselves.

“Technology such as electronic invoicing can help battle invoice fraud as only confirmed suppliers can upload their invoices and then these are validated before they are paid, potentially saving firms thousands of pounds.”

 

Whether you use technology or rely on person-power to check your invoices, make sure they are checked before opening or paying them:

 

These measures will help you to keep your company’s hard-earned money in its own bank account – and not in the hands of scammers.

About The Author

Karl Bilby

We work very closely with our expert accountants to bring you the latest factually correct tax and accounting news. We also enjoy writing about small business news that we hope you find useful!

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