This presentation by Law 2.0 Conference reviews different types of vendor scams and shares quick tips to prevent them.

1. Law 2.0 Conference Reviews
Vendor Scams

2. ➢ Review Of Vendor Scams
➢ Types Of Vendor Scams
➢ Tips To Prevent Vendor
Scams
Table Of
Contents

3. Everything About Vendor Scams
A vendor scam occurs when a vendor or an employee defrauds a company by
delivering fake vendor or account details to collect unlawful payments.
It takes around 18 months to detect vendor fraud, which is why many people
indulge in such scams.
But, what encourages people to indulge in vendor fraud?

4. Factors That Encourage
People To Indulge In Vendor
Scams
● Financial pressure or job
insecurity
● Greed to get financial gains
without getting caught
● To take revenge from the
association

5. Types Of Vendor Scams
● Over-Billing
Vendors add extra products or services to the bill which were not delivered to the company
because of lack of checks in between the process. By overcharging the companies these fraud
vendors try to gain undue advantage.
● Fictitious Vendors
In this vendor scam, the company’s employee creates a fake invoice or vendor and asks for
refund. Once the company clears the bill, it reaches the employee’s account. Many times,
employees create fake account numbers, email addresses, and tax ID numbers.

6. Types Of Vendor Scams
● Check-Tampering
The employee or third party uses the check to illegally obtain or borrow budgets from the
account holder without legal rights. This scam is done by altering, intercepting, or forging
checks into their bank account.
● Bid-Rigging
It is an illegal bidding process where vendors collaborate with each other, directing a rise in
the price compared to fair bidding. This increase in price impacts the consumers and
taxpayers associated with the process.

7. Tips To Prevent Vendor Scams
➢ Shift to digital records instead of relying on people for the billing process.
➢ Involve multi-step payment approvals to prevent people from conducting a scam.
➢ Look for the bidding patterns and if something seems scammy, look deeper into the matter.
➢ Adopt automation and machine learning tools to create transparency in the billing process.

8. Thank You
This presentation is
prepared by
Sai Narula
Manager, Law 2.0
Conference