Preventing Vendor AP Fraud
A Great Tip For Maintaining Your Vendor File
Posted by Steve Wilcox on Fri, Mar 06, 2009 @ 10:59 AM
Yup, that's an outhouse.
What if you used Google Maps to view a vendor address and it turned out to be an outhouse?!? Alarm bells would probably go off in your head that an unscrupulous "vendor" was trying to swindle your company.
Nat Goodman used this outhouse example in this past week's webcast on preventing AP fraud. As we discussed in the last blog entry and according to Nat:
"Every addition or change to the vendor master should be verified to approved documents [such as updated W9s, contract amendments, verified correspondence, etc]. That means approval and support before keying AS WELL AS verification to file changes AFTER processing. In order to avoid duplicate vendors on file, be particularly careful about how the vendor name is keyed with consistent naming and keying conventions."
Vendor addresses should be treated particularly carefully. Again, according to Nat:
"We need to guard against false addresses that can be used to embezzle funds. However, we are not only concerned with phony vendors but we want to confirm that the vendor appears to be a business person with legitimate qualifications to perform the work or provide the goods. Switchboard.com and Yellowpage.com have business and residential listings. Mapquest.com is great way to view a property. Many consultants/service providers work out of their home. Here is an opportunity to view their home. If they have an outhouse on the property you may think twice. If a goods producer lists an address on a vacant lot, a red flag goes up and you may want to check further."
Bottomline ... all new vendor addresses or changes should be carefully verified. With Google Maps or a similar tool, it's easy to check a vendor's office or location.
-Rakesh Shukla
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