Best Document Fraud Detection Software

Document fraud is a significant threat to businesses. Wrecking reputations. Triggering huge financial losses. Regardless of industry, you’re a target. While artificial intelligence has eased so many business processes, fraudsters are exploiting the same technology to line their pockets. We need to take the offensive with document fraud detection software, powered by AI and machine learning, to fight fire with fire.

From cybersecurity to AI-human collaboration, our Document Automation Trends 2025 report dives deep into the trends hitting the streets this year.
Trends that’ll shape your strategy for the win.

What is document fraud?

Document fraud is the creation, duplication, counterfeiting, or forgery of documents. The intent being, to deceive or commit fraud for personal gain. Targeted documents include financial, legal, identity, governmental, etc., etc.

Document fraud can bring about devastating consequences, including financial losses, legal liabilities, reputational damage, and security threats. Which in turn will destroy customer trust, and can lead to identity theft, fraud, money laundering, and terrorism.

Document fraud is accelerating in the finance sector because of the prevalence of KYC – know your customer – and onboarding data, with forged documents being used to buy property, apply for loads, file false insurance claims, and more.

In March 2019, a fraudster pleaded guilty to billing Facebook and Google $123M+ over a three-year period, with fake invoices. Let me repeat. Three years before they were noticed!

If tech giants can fall victim to document fraud… so can you.

More recently, in 2023, the Federal Trade Commission – FTC – reported 1.1M+ cases of ID theft in the US, with document fraud the biggest contributing factor. While Europol reported a 25% year-on-year increase in document fraud across Europe.

How does document fraud happen?

Your fraudster may be a dodgy person clumsily creating a fraudulent document that can be spotted with the naked eye. Or, a professional scammer who creates a near-perfect fake document that requires either years of experience or artificial intelligence to recognize.

I recently wrote a piece – Generative AI Is Fueling A Surge In Invoice Fraud – discussing the part Gen AI plays in creating fake documents. And yes, the conclusion is that the best way to tackle fake invoices is to fight Generative AI fire with AI fire.

The impact of document fraud on your business

The impact of document fraud on your business can be devastating, long-term, and irreversible. Knock-on effects include…

Operational disruption

Hit by document fraud, it’s inevitable that resources must be diverted to investigate how the attack happened. Shifting the focus from your core business activities. 

Financial loss

There will be money lost, with fake documents often used for financial gain. Either via unauthorized access to finds, illegal transactions, or payments made/received for non-existent goods.

Reputation damage

Through no fault of your own, a fraudulent attack can damage your reputation, destroy customer trust, and kill relationships with vendors, partners, and employees.

Legal disputes

Chances are high, if your business suffers document fraud, there’ll be legal and regulatory issues. This can lead to expensive litigation. Even loss of your business.

Types of document fraud

• FBI’s Internet Crime Complaint Center (IC3) – received 800,944 complaints in 2022, with estimated losses of around $10.2B.
• 2023 AFP® Payments Fraud and Control Survey – 65% of organizations were victims of payment fraud attacks/attempts in 2022, with more than 27% able to recover at least 75% of the funds lost. But, nearly 44% failed to recoup their losses.

The most common types of document fraud are…

Financial fraud

An individual or organization manipulates transaction documents. Including invoices, cheques, bank statements, loan applications, purchase orders. To commit financial fraud or embezzlement.

If you’d like to learn more about invoice scams, take a look at How To Identify Fake Invoices. 

Insurance fraud

Fraudsters submit fake documents related to insurance claims. For instance, medical records, accident reports, invoices submitted for financial benefit. This type of fraud is found in the following sectors – healthcare, automotive theft, medicare, life insurance, disability.

Mortgage fraud

Mortgage fraud is the submission of fake documents – bank statements, tax returns, property appraisals – to get a loan or mortgage.

Receipt fraud

is the manipulation or submission of duplicate receipts. Risks include illegitimate cashback or loyalty point payouts, and fraudulent expense claims.

Forged documents

Details altered, added, or totally replaced. For instance, adding a watermark, deleting or adding new pages, including fake or altered signatures, adding fake seals.

Social engineering

Designed to trick people into sharing sensitive information such as bank details, to create fake documents or commit identity theft. Includes phishing scams or pretexting.

Identity theft

The theft of someone’s personal information – financial details, social security number, passport, driving license, etc., to impersonate them. The forged identity documents are then used to apply for credit, open bank accounts, submit loan applications, and more.

Insider fraud/employee fraud

When someone in your company has access to legitimate documents and exploits their position or authority. For instance, they take a genuine vendor invoice, and rather than paying into the vendor’s bank account, they redirect to a third-party’s account. Having access to your AP system, the world is they’re oyster.

“31% of fraud cases are perpetrated by an employee, and 26% from collusion between internal and external actors.” PWC’s Global Economic Crime and Fraud Survey 2022

Counterfeit documents

Replicas of official documents, such as currency, ID cards, passports, certificates, driving licenses, etc. The counterfeiter then uses these fake documents to get access to more confidential information. For instance, using a person’s driving license to obtain their bank account details.

Digital document fraud

The falsifying or manipulating of electronic documents, digital records, or online transactions to commit cybercrimes against individuals or organizations.

Best practices for protecting your business against document fraud

Aside from document fraud detection software…

If you know what to look for, and how, you’ll be able to protect your business from reputational damage and financial loss.

Keep your ear to the ground

Fraudsters never sleep. Crafting more devious and damaging scams for financial gain. If you’re not aware. If you’re not listening to the word on the street. You’re an easy target.

Read the stats. Follow the trends. Which documents are being targeted? How? Which industries are being attacked? How? 

Train your team

You warn your team about phishing emails. Set up two-step verification. Ensure they’re following security protocols. Training them on document fraud detection and prevention should figure.

Show your employees what to look for. How to recognize a manipulated document. Make them aware.

Use document fraud detection software

Bring in the big guns!

As document fraud becomes more sophisticated with the advancements in artificial intelligence, so too do the weapons to fight back and protect your brand’s reputation.

A document fraud detection system, powered by machine learning, AI, and natural language processing (NLP) is able to analyze and extract increasingly large volumes of data from various types of documents…

• Invoices
• Bills of lading
• Customs clearance documents
• Purchase orders
• And more

Identifying patterns and anomalies that prove fraudulent manipulation of documents. 

Regular audits

Regular audits are essential in your fight against document fraud. Ensuring the integrity of documents and maintaining compliance. You’ll need to set up an auditing schedule, train your team, and employ advanced technology solutions.

How to detect document fraud?

If you don’t have many documents to check. If you’re dealing with an amateur fraudster. Manually examining documents is possible. Identifying spelling mistakes, blurred text, inconsistent fonts, etc. 

But, if you’re managing a large volume of documents and artificial intelligence enters the room, document fraud is harder to detect and stay on top of.

An AI-powered document fraud detection software that provides validation and document verification via automated document workflows, is the most effective way to find and stop fraud in its tracks.

Fight AI document fraud with AI

Rossum’s transactional document automation platform uses AI to read and analyze documents. In seconds. Trained on millions of transaction documents, Rossum understands what ‘normal’ looks like. Able to identify the tiniest irregularities.

For businesses that have adopted automated document processing, they must be confidant that the technology can reveal document fraud. AI trained to recognize inconsistencies, errors, behavioral changes, etc. An AI gateway with…

• Centralized monitoring and analysis – AI algorithms, tools, or applications are used to monitor and analyze incoming document traffic in real time.  
  
• AI fraud detection solution trained with historical data to find anomalies, inconsistencies, or patterns associated with fake documents. Using machine learning models to analyze metadata. Continuously learning and adapting to new AI threats.
  
• Data matching process to compare data in a document against a trusted or verified source. This will prove the authenticity of the document by ensuring data aligns.
  
• Three-way matching involves matching information from multiple sources to prove validity. Invoices automatically compared with purchase orders and proof of delivery, for instance.
  
• Advanced verification protocols that cross-reference document details – bank account number, address, PO number, shipping number – with historical data, vendor legitimacy checks, and confirmation of transaction consistency.
  
• Natural language processing algorithms that analyze the language, finding anomalies in the linguistic patterns and detecting fraudulent documents.
  
• AI image analysis that examines graphic elements in documents – logos, signatures, etc. – to reveal alterations or inconsistencies.
  
• Behavioral analysis and pattern recognition to identify patterns or behaviors associated with genuine and manipulated documents. With changes in standard patterns triggering alerts.

Rossum’s document fraud detection solution

Through our ergonomic user interface, our platform enables efficient, reliable and fast human – AI collaboration for rapid transactional document processing. This powerful mix of AI, machine learning technology, and human know-how brings…

• Unmatched productivity and accuracy
• Protection against document-based risk
• Improved partner relationships
• Strategic insights for business transformation 

Let’s look at the drivers behind our intelligent document processing solution for document fraud detection…

AI you can trust

• Our advanced AI is powered by our proprietary large language model. Tailor-made for transaction documents. But… it differs from traditional LLMs in its level of trustworthiness, safety, and customizability. Without any of the risks, such as hallucinations.
• Trustworthy automation that flags when confidence is low.
• Secure and reliable, without the threat of prompt injection attacks or data leaks.

AI you can control

• AI engine that instantly learns at scale from a few inputs.
• Ergonomic UI for fast human – AI collaboration, even for complex data extraction.
• Customizable AI to fit your specific business needs. From data extraction to email drafting and document splitting.

AI that delivers business impact

• Reduced time spent on data capture, document pre-processing and discrepancy communication.
• Stop! Don’t hand over your cash until you’ve put our platform to the test with your own documents, for free.
• Easy implementation means you don’t have to bother your IT team.

We use AI to analyze the structure, format, and content of a document. Looking for inconsistencies and manipulation. Be they dodgy alignment, logo quality, or fonts. Discrepancies will be identified that may indicate potential document fraud.

Rossum Aurora – our AI engine – was trained on the most extensive dataset of transactional documents on the market. Historical data that can identify anomalies, irregularities, or patterns associated with document fraud. Ongoing learning ensures our platform is capable of identifying new fraud risks.

Document fraud detection FAQs

Protect your business against document fraud today…

Because tomorrow will be too late.

An intelligent document processing solution will help you identify document fraud. From data capture, validation, and three-way matching, to duplicate invoices and mismatched data. Our IDP technology will automate the analysis of large volumes of data, detecting discrepancies that could be missed by manual processes. Protecting your business against fraud.

Don’t have time for an hour-long demo?

Take a spin around our interactive demo. See how intuitive our AI document processing platform is. And how we can protect your business operations while driving productivity.