The top 12 false expense claims and software to prevent fraud

By Grégory Coste.

Published: October 17, 2024

Any employee can forge a business expense claim. Especially if the company has no expense management policy or control procedures in place.

According to Les Echos and Capital :

Fraud costs an average of €700 per employee per year.

More than 60% of French people inflate their travel expenses,

50% their meal expenses,

43% inflate their accommodation expenses.

Furthermore, a company director who is unable to justify an expense claim may be subject to a reassessment by URSSAF in the event of an audit by the tax authorities.

appvizer therefore advises you to keep your accounts up to date with original receipts, and to read this article carefully. We reveal 12 cases of false invoicing and show you how to take action against fraudsters.

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The top 12 false expense claims

Fraudsters are very imaginative when it comes to creating a false expense claim. Most of them are motivated by the search for compensation.

This compensation is intended to balance (as you wish) :

time wasted filling out expense forms,
a lack of consideration from the company,
a low salary,
having to pay in advance,
the time it takes to be reimbursed.

Fraudsters have no shortage of ideas for obtaining this additional tax-free salary...

No. 1: the false restaurant bill

The false restaurant bill is a classic: used by employees and the self-employed alike.

Everyone has their own model for a fake restaurant bill:

get invited to a business lunch, but get a copy of the bill to be reimbursed by your company;
pay your share of the bill (indicating several place settings) and present this false meal voucher to your employer for reimbursement;
pretend to have invited guests so as to exceed the maximum amount authorized for lunch: simply ask for 2 place settings instead of 1 on the bill;
being on half-board in a hotel, but asking for a receipt for lunch, is another way of providing a false meal bill.

No. 2: the false hotel bill

The false hotel bill is generally much higher than the average. It is accompanied by an expense voucher showing a global amount.

From simple employees sent on professional training to top management executives, everyone asks hotels to inflate the price of overnight stays in order to conceal certain non-business expenses.

False invoices for Ibis, Campanile or other hotels are commonplace, and generally conceal :

phone calls to overtaxed numbers,
a "good slap" in the minibar,
pay-per-view adult video,
in-room dining with a "client".

The "client" is often the spouse accompanying the employee on a business trip.

No. 3: the fake cab bill

How do you cheat on your cab bill?

Here are two common practices, especially in foreign countries, and sometimes in France:

ask to enter a higher amount than that of the fare, in order to be reimbursed for a sum greater than that actually spent,
ask for a blank form so that you can enter the amount on the fake cab bill yourself.

Another 5-step trick for creating a fake cab bill:

tell the driver that his business card is not working,
ask for 2 copies of the bill, and explain to the driver that the company (of the person being transported) will pay him directly for the fare,
send a copy of the trip to the accounting department,
also send a copy of the trip to his manager,
get reimbursed for the fare you didn't pay yourself.

Cabs aren't the only way to create a false travel claim.

Here are 5 examples of fraudulent travel expenses .

N° 4: the little train ticket scam

A business trip is planned. The company provides a first-class e-ticket to ensure the best possible comfort for its employee.

Simply exchange the ticket for a second-class one and pocket the difference, providing the first-class e-ticket to the relevant department. The accountants won't even notice.

No. 5: Air ticket fraud

Applying the same principle as for the train, the fraudster pockets a higher sum this time.

Imagine a round trip to the USA: the difference in ticket price between first and second class represents a substantial profit.

Note: fraud involving a train or plane ticket is less serious, as the company actually spends what it had planned to spend.

No. 6: Lying about mileage costs

The mileage scale is set by the authorities and defines the amount of reimbursements for business travel.

The idea is to falsely declare the mileage expenses incurred for this type of journey.

To make sure you get the maximum amount of money, all you have to do is declare :

7 horsepower and use a less powerful vehicle such as a motorcycle,
a longer distance than the actual kilometers covered.

No. 7: Fake proof of full tank of petrol

All you have to do is ask people around you for a proof of payment, which you can then present to your accountant to be reimbursed for the unspent amount.

The cleverest fraudsters will pay particular attention to working hours, location and type of fuel, if this information is given.

No. 8: Fake parking tickets

It's easy to use fake parking tickets to justify expenses and pocket money.

This practice is tending to disappear with the advent of parking meters, which require you to enter your license plate number (in the whole of Palavas-les-Flots in particular).

For expenses incurred with a vehicle, we strongly advise you to ask for the vehicle registration document.

No. 9: Determine an advantageous exchange rate

It's possible to go on a business trip and enjoy it at the expense of the princess. If your employer hasn't set a policy regarding the exchange rate of foreign currencies, it's easy to declare a rate that's more than advantageous for you.

Here's how to commit fraud with impunity:

present receipts for expenses incurred abroad, expressed in the local currency,
indicate an exchange rate that can save you hundreds of euros!

The advantageous conversion of foreign currencies into euros is all the easier if you take into account the language used to describe the expense claim.

Languages such as Chinese and Japanese have characters that are illegible and incomprehensible to the vast majority of French people, making it very easy to lie about the name of the service and its amount.

If there are no control procedures, your accountant will have to take your word for it!

No. 10: Business gifts to fictitious customers

Certain salespeople or executives are authorized to give gifts to their customers.

Depending on the importance of the customer and the budget allocated to business gifts, the gift may be a simple advertising pen, a box of chocolates, or even a bottle of Grand Cru Classé for the important or long-standing customer.

The temptation is great for some fraudsters to offer these gifts to friends, family or even themselves in a roundabout way.

Another false expense claim that's never seen or heard of...

No. 11: get reimbursed twice

Some fraudsters have the nerve to ask for reimbursement again for an expense already covered by the company.

To understand their game:

the expense was incurred several months ago,
the employee has kept the receipt. The employee relies on the forgetfulness of the manager or accountant, drowning in expense claims to be processed.

Tip: always ask for the original receipts and keep them.

No. 12: Create false invoices

Fake invoice templates are available on the Internet, for example, to create a blank restaurant expense report.

Some people also use Photoshop software with a certain mastery.

However, any member of the company who commits fraud by creating a false invoice from scratch is liable to dismissal for serious misconduct.

The fraudster is also liable to sanctions under the law:

Making or using false documents is a punishable offence: up to 3 years' imprisonment and a €45,000 fine.

Source : Service-Public.fr

Solutions to combat fraud

The question on your mind is: what are the best solutions for preventing abuse and putting fraudsters out of business?

Software is the essential tool for detecting and, above all, preventing fraud. You'll benefit from regular automatic updates, which is very useful, especially if the mileage scale changes.

But before you buy, you need to establish an internal "contract of trust".

Establish a business expenses policy

The manager must draw up an agreement specifying the rules to be respected regarding expenses incurred on behalf of the company.

These rules must then be communicated to all employees. The human resources manager must ensure that the key measures are understood by all company members concerned.

The basic rules :

set a framework for use and the nature of authorized expenses,
define an amount per type of business expense,
list the information required to justify expenses,
establish a maximum reimbursement period for the employee.

It's a good idea to seek legal advice from a law firm specializing in employment law. They are familiar with social issues and the various collective bargaining agreements.

Define expense management and control rules

For effective protection against false expense claims, you need to take the necessary steps. By using software, you can dematerialize your expense reports and benefit from global visibility of expenses incurred.

You save time and keep an eye on your employees' expenses:

all expenses are centralized,
reports can be consulted in real time,
a dashboard shows expenses by type,
you can easily track and analyze expenses.

In addition, you can control which employees travel the most, and which have the most business expenses.

Expense management software