# What is invoice fraud and how can it be prevented?
Invoice fraud occurs when criminals submit fake invoices or manipulate legitimate ones to steal money. Common types: (1) Fake Vendor Schemes - creating fictitious suppliers and submitting fake invoices; (2) Invoice Manipulation - altering amounts, bank details, or payee information; (3) Business Email Compromise (BEC) - impersonating executives to authorize fraudulent payments; (4) Duplicate Invoices - submitting same invoice multiple times. Prevention methods include: implementing 3-way matching, segregating duties (ordering, receiving, payment), verifying bank details changes directly with vendors, using AI to detect anomalies (unusual amounts, new vendors, duplicate patterns), requiring approvals above thresholds, enabling payment controls and verification, training staff on fraud indicators, and monitoring for suspicious patterns. Automated invoice processing with AI detection reduces fraud risk significantly versus manual processes.
## Key Takeaways
- Invoice fraud occurs when criminals submit fake invoices or manipulate legitimate ones to steal money.
- Common types: (1) Fake Vendor Schemes - creating fictitious suppliers and submitting fake invoices; (2) Invoice Manipulation - altering amounts, bank details, or payee information; (3) Business Email Compromise (BEC) - impersonating executives to authorize fraudulent payments; (4) Duplicate Invoices - submitting same invoice multiple times.
- Prevention methods include: implementing 3-way matching, segregating duties (ordering, receiving, payment), verifying bank details changes directly with vendors, using AI to detect anomalies (unusual amounts, new vendors, duplicate patterns), requiring approvals above thresholds, enabling payment controls and verification, training staff on fraud indicators, and monitoring for suspicious patterns.
## Related Topics
- invoice fraud
- fake invoices
- invoice scam prevention
- AP fraud