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Why Do Employees Justify Exaggerated Expense Reports?

Why is expense fraud happening? 

Expense fraud can be a major problem for any business, and as Anant Kale, founder and CEO of AppZen, told PYMNTS last week, companies naturally want to believe they don’t have fraud occurring in the enterprise. Typically, he said, businesses don’t recognize the need to protect against expense fraud until evidence has been presented that it’s actually happening.

A new survey from Webexpenses found that employees are actually having quite an easy time committing expense fraud.

Reports in Business Matters, which covered the results of the survey, noted that Webexpenses found 84% of employees in the U.K. said they have never had any expense claims challenged or denied. Nearly half of survey respondents said they have increased number of miles traveled to inflate expense reports.

The survey also found an ongoing pattern of employees saying they feel they deserve a “treat” or some type of reward for traveling for work, which may come in the form of exaggerated expense reports for a larger reimbursement.

In written responses by survey respondents, some workers are using expense fraud to be reimbursed for massive personal purchases, with one respondent admitting they claimed a DSLR camera on one report, and another claiming a gas cooker.

“The results bring to light the changing patterns of expense fraud, the shift to more subtle methods to efficiently enable claims to fall through the cracks and raise no red flags,” reflected Webexpenses CEO Adam Reynolds in a statement. “The most prominent area being exaggerated [is] mileage claims; this could be down to employees feeling it’s completely innocent just rounding up mileage, and with a manual process, it’s a lot harder to identify.”

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If you're interested in finding out more about Webexpenses and how to prevent expense fraud, feel free to contact us or request a free demo.