How algorithms are changing the way companies handle fraud
Human auditors aren’t redundant just yet but technology has stepped up to lend a helping hand
An employee travelling for work checked his dog into a kennel and billed it to his boss as a hotel expense. Another charged yoga classes to the corporate credit card as client entertainment. A third, after racking up a small fortune at a strip club, submitted the expense as a steakhouse business dinner. These bogus expenses, which occurred recently at major US companies, have one thing in common: all were exposed by artificial intelligence (AI) algorithms that can in a matter of seconds sniff out fraudulent claims and forged receipts that are often undetectable to human auditors — certainly not without hours of tedious labour. AppZen, an AI accounting start-up launched 18 months ago, has already signed up several big companies, including Amazon, IBM, Salesforce and Comcast, and claims to have saved its clients $40m in fraudulent expenses. AppZen and traditional firms such as Oversight Systems say their technology is not erasing jobs — so far — but rather freeing up auditors to dig d...
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