Business fraud in the Benelux: this is where we stand

Businesses in Belgium and the Netherlands are more likely to experience frauds and scams. 51% of companies say they have faced this in the past two years. It also appears that fraud is increasingly taking place digitally. In short, that is the conclusion of the research that we did with Hoffmann Bedrijfsrecherche into fraud. The study aims to obtain an up-to-date picture of fraud within the Benelux business community.

On this page you will find the most important conclusions of the study. Curious about all the research results? Do not wait any longer and fill in the form on this page. We will send the complete research report directly to your mailbox!

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Many days, attention is focused on the rise of cybercrime, but the vast majority of fraud affecting businesses comes from within - employees committing theft or scamming their own company. Classic fraud, as we have known it for a long time, is still the most common, according to our research. We don't hear much about this in the media because companies prefer not to air out their dirty laundry.

What should we think about when it comes to internal fraud by our employees? It's very diverse. Think of products that are simply set aside and then taken when they leave. Or money that is transferred to one's account or taken from the cash register. Or family, friends and acquaintances who unfairly receive a discount.

Also, the employee can create fake invoices for non-existent suppliers. Even more drastic is when one's employee sells or passes on confidential company information to a competitor.

Our research shows that in the case of fraud from outside the business, so-called "invoice fraud" is the most common. 53% of companies have experienced this in the past three years. Invoice fraud involves companies receiving a false bill for goods or services that were not delivered. Often the scammer uses the identity of regular suppliers of the company for this purpose. Fake invoices may also have been sent as though they were from the government, tax authorities, banks, telecommunications companies or other large organizations. The fake invoice is almost indistinguishable from the real thing. The amounts on the fake invoices are usually not too high. As a result, it takes a lot of time to figure out that they are false. The scammer bets that the fake invoice won't stand out in the daily stream of invoices and will be paid automatically.
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After 'invoice fraud', 'buyer fraud' is the most common. 41% of companies have experienced this version of fraud. Examples of invoice fraud:

  • The scammer places an order on behalf of a regular customer but gives a different delivery address.
  • The scammer places an order and receives the goods but then reports that they have not received the goods.

The common thread in external fraud is that the fraudsters capitalize on everyday practices and mimic reality. In doing so, fraudsters pretend to be trusted associates. For example, they take on the identity of a regular customer or even sometimes one of the company's managers.

Consider, for example, a financial administration employee who receives an email from his manager asking to transfer money urgently. From the email message, it's hard to tell that a fraudster is behind this. The fraudster adds a personal phrase to sell that the email is from the manager. The scammer will often pluck this information from social media.

The rise of working from home provides identity fraud scammers with additional opportunities. At home, employees are more vulnerable. They do not have colleagues around them whom they can ask for advice in the event of an unclear situation. At home, they have to decide for themselves.

Business owners report that fraud is increasingly showing up online. There are roughly two methods that can be distinguished in digital fraud: either criminals try to trick employees by taking on an identity, as mentioned earlier, or they target weaknesses in the company's computer system and try to insert malware via a virus link. Attacks on the computer system are usually referred to when cybercrime is mentioned.

It is an illusion to think that companies can prevent fraud 100% of the time. Criminals are too handy for that. The methods they use are becoming more sophisticated. No matter how many technical measures companies take and how safety-conscious employees are, any company can be hit. Two different types of insurance are needed to cover the fraud examples mentioned in this article with insurance: fraud insurance and cyber insurance.

46% of companies think cyber insurance adequately protects against all digital fraud. This is not the case. For example, stealing passwords or redirecting to other websites to commit fraud is covered by fraud insurance. Whereas, for example, liability damages when data has been stolen are covered under cyber insurance. In general, you can say that cyber insurance protects against business losses due to a cyber-attack and liability for damages to third parties. In contrast, fraud insurance covers the financial consequences of both employees and fraud from outside the business.

The financial impact of fraud can be large to very large. Our research shows that 51% of companies have been victims of fraud in the past two years. In 48% of the cases, the damages were up to 50,000 euros. 10% had claims between 200,000 and 500,000 euros. And 1% even exceeded 5 million euros.