Fighting Back With 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.

Ready to hunt for fake documents? Let us show you how we defeat those pesky fraudsters so your business’ reputation and revenue are protected.

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, identification, government, etc., etc.

Document fraud can lead to devastating consequences, including financial losses, legal liabilities, reputational damage, and security threats. Leading to the destruction of customer trust, identity theft, fraud, money laundering, and terrorism.

Document fraud is accelerating in the finance sector due to the prevalence of KYC – know your customer – and onboarding data. Forged documents are 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.

How does document fraud happen?

Your fraudster could be some dodgy person clumsily creating a forgery that can be spotted with the naked eye. Or, a professional scammer that creates near-perfect fake documents that require 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.

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

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.

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, etc. The forged 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

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 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.

Document fraud detection software, 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, etc. Identifying patterns and anomalies that prove fraudulent manipulation of documents. 

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.

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

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 have confidence that the technology can identify 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 to analyze metadata. Continuously learning and adapting to new AI threats.
  • 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 analyze the language, finding anomalies in the linguistic patterns that hint at fake content.
  • 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 software

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, and strategic insights for business transformation. 

Let’s take a 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 risk 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 types.

Document fraud FAQs

What’s an example of document fraud?

A genuine document, let’s say an invoice, created by a fraudster and sent to a business for payment. But, there weren’t any products delivered. The fake invoice would include a vendor known to you, but with the wrong payment details.

What are the different types of document fraud?

According to Interpol, the most common types of document fraud are…

Counterfeit documents – a copy of an official document which doesn’t have authorization from the relevant authority

Forged documents – a genuine document that’s been manipulated to add, change, or delete information

Pseudo documents – details or codes copied from official documents such as ID cards, passports, social security cards, but not recognized by official organizations or countries

How do you detect fraud in documents?

If you’re performing a manual check, look for missing or altered numbers, altered text or images, data entry errors such as incorrect dates and names, spelling mistakes, email addresses with a single character change, inconsistencies in fonts, strange formatting, incorrect logo, quality of document.

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, three-way matching, to duplicate invoices and mismatched data, our IDP solution 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.

Ready to hunt fake documents?

Protect your business with AI document fraud detection software. Fraudsters won't know what hit them!