#fraud-prevention
Proactive strategies and controls to prevent financial fraud in your business
How a community theatre records ticket settlements gross of platform fees, holds advance sales as deferred revenue, tracks donor-restricted grants separately from board designations, budgets each production against a 75% attendance base case, and builds compensating internal controls for volunteer-run cash handling.
A three-way match compares the purchase order, receiving record, and supplier invoice before any payment is released, catching duplicate bills, unapproved price increases, and short shipments. This guide shows small businesses how to implement the control with clear ownership, line-level matching, written tolerances, and a practical exception workflow — plus when a two-way match is the better fit.
A practical control framework for small-team purchasing cards—role-based limits, same-day receipt capture, weekly reconciliation, and independent review—so fast spending stays documented and auditable.
QR-code phishing (quishing) can redirect a vendor payment or capture a customer's card by swapping one image. The defenses are ordinary bookkeeping controls—verify the vendor master, separate approval from payment release, and reconcile QR channels daily.
Visa's Acquirer Monitoring Program (VAMP) merges TC40 fraud reports and TC15 disputes into one ratio, and the 2026 merchant "excessive" threshold dropped to 0.9%. This guide shows exactly how the ratio is calculated and gives small merchants a prevention and gross-to-net bookkeeping playbook to stay under it.
Cargo theft losses hit $725 million in 2025, up 60%, with average theft at $273,990. Small carriers face 18 percent cargo premium hikes, theft sublimits, and stricter underwriting on high-risk lanes—learn what thieves target, where risk moved, and the bookkeeping that keeps coverage intact.
Congress set a 10-year statute of limitations for PPP fraud, so a loan funded in 2020 can be charged until 2030 and forgiveness is not a defense. This guide covers False Claims Act liability, the five eligibility tripwires still generating cases, and the six-year record-retention rule borrowers must meet.
A six-week playbook for moving business bank accounts—inventory every ACH, wire, and payroll rail first; seed the new account to dodge Regulation CC holds; move payroll last with a prenote; and run both accounts in parallel with daily reconciliation before closing.
IRS Letter 6042C verifies a specific business return; Letter 5263C verifies the entity itself on file from Form SS-4, and both carry a 30-day response window that, if missed, stalls your returns, refunds, and overpayment applications. This guide explains how thieves obtain an EIN, the tax and non-tax red flags that signal fraud, exactly what to fax back in each case, when Form 8822-B is required within 60 days of a responsible-party change, and a monthly-quarterly-annual monitoring routine that catches misuse early.
ASC 606 treats a right of return as variable consideration, so an $80,000 sales month with a 9% historical return rate is $72,800 of net revenue, a $7,200 refund liability, and a recoverable-inventory asset — not $80,000 booked as final. This guide shows how to build a category-weighted reserve from 12 months of your own data, flag the 5 to 10% of buyers who generate 30 to 40% of returns, and apply graduated account limits that stay documented and defensible.
Rhode Island's SB 3212, signed in June 2026, lets business owners remove fraudulent UCC filings through an administrative complaint, authorizes the Department of State to refuse suspicious filings, and requires misleading "annual report" solicitation letters to disclose that they are advertisements. The same defenses — quarterly UCC searches, entity-record checks, and fee verification — work in every state.
AI-generated fake receipts rose from 0% to 70.8% of detected expense fraud in fourteen months, averaging $101 per claim, and small businesses can counter it by matching receipts to actual transaction records instead of judging document appearance.
