From AI-written resumes to AI-assisted job interviews and entirely fake job applicants, the technology is creating new concerns among HR circles about the ethical and legal impacts of AI in the recruiting process. Now, new data highlights another area where AI forgery could rear its head: business expense reports.
New research from travel and expense management firm Emburse, based on a survey of 2,000 workers in the U.S. and UK, found that 4 in 10 U.S.-based employees have used AI to create a fake receipt on a business expense report. Nearly 20% say the AI-generated content was an entire fabrication, while about 15% used AI to increase the price of the expense; meanwhile, 6% used AI to replace a lost receipt for an actual expense.
In a blog post about the research, Emburse Chief Revenue Officer Michele Shepard noted how drastically gen AI has transformed the world of business expense fraud. The tech can create realistic content in just seconds, eliminating the historic “barrier to entry.”
Before the dawn of gen AI, “an employee might submit a questionable claim here or there,” she writes, “but creating entirely fabricated documentation that could withstand scrutiny required a level of sophistication most people didn’t possess.”
Fraud detection processes need a refresh for an AI-powered world, the Emburse report suggests. In particular, Shepard writes that systems need to detect fabricated content, identify unusual reimbursement patterns and monitor divergent spending across departments and vendors.
“As AI becomes more accessible,” she says, “organizations need controls that are equally intelligent.”
When it comes to formulating a more modern approach to expense fraud, Shepard also suggests leaders consider the context. Financial struggles, exacerbated by reimbursement friction, could be prompting employees toward fraud.
Nearly one-quarter of respondents in Emburse’s data admit making a personal purchase and trying to pass it off as a business expense, a move Shepard calls “revenge spending.” Of employees who have done this, about three-quarters say they’re concerned about their personal finances, and more than half of U.S. employees have taken a hit from overdraft fees and credit card interest as they wait for reimbursements from their employer.
“When employees repeatedly front business costs, absorb financial consequences and wait extended periods for reimbursement, frustration can become a risk factor,” she says. “In other words, fraud prevention isn’t only about detection: It’s also about reducing the conditions that make non-compliant behavior more likely in the first place.”
Credit: Source link
