How to Stop a “Non-Accomplice Vendor Scheme”

How easy is it to steal from your company? Savvy and dishonest employees may easily exploit internal weaknesses by running a “non-accomplice vendor scheme.” The vendor is not a part of the scheme, but the unscrupulous employee will mastermind a vendor scheme either as a pay-and-return scheme or by intentionally overbilling the vendor.

fraud schemes prevention

In the pay-and-return scheme, payments owed to a legitimate vendor are intentionally mishandled- the employee will double pay on the invoice, pay the wrong vendor, overpay the invoice amount or purchases excess merchandise. When an employee fraudulently over-bills a vendor’s invoice, she creates a fake invoice or may rerun an invoice already paid.  The employee will then intercept the refunded check, depositing it into her personal bank account.

To prevent this type of fraud, incoming checks should be photocopied and attached to the remittance advice; also your bank should be instructed not to cash checks payable to an organization. Find out how to spot and prevent these schemes when you contact ARA at 636-346-9273.