Amazon is a one-stop shop for millions of customers. Low prices, quick shipping, and a wide variety of product categories also make this platform enticing for small to large businesses and organizations.
With the explosion of business purchases made via Amazon or Amazon Business by employees, it’s safe to say that Amazon Business expenses is the new normal. With that comes the added challenge of being able to call out potential fraud and prevent abuse of Amazon Business accounts.
So how do we reap all the benefits of Amazon Business while maintaining compliance and preventing fraud and abuse?
Understand What Amazon Business Fraud and Abuse Can Look Like
Amazon Business comes with a wide array of benefits whether it’s:
- Free two-day shipping on all Prime-eligible items
- Business-only prices on more than 5 million different products
- Multi-user accounts allowing you to connect your entire team and purchasing groups
- Tax-exempt purchasing if your organization is eligible
That said, these benefits are only applicable to approved Amazon Business expenses. Since buying on Amazon is so easy, abuse or fraud could occur if an employee decides to use the Amazon Business account for a personal purchase. Let’s say an employee logs into the company’s Amazon Business account and buys something with their personal credit card. Sure, they might not have used a company purchase card. However, their personal purchase utilized the tax benefits and free shipping that comes with the business account.
Or, maybe an employee does use their purchasing card to buy personal items which is a classic case of fraud. While it’s not possible to permanently delete Amazon purchase history, it’s not hard to hide (or archive) past orders. One offense like this is already too many. If this persists over time, it could create state tax issues and financial loss for the organization.
Concentrate on More Specific Data Mining Methods
Data mining occurs when you take data from your expense transactions and carefully analyze it to determine certain patterns of behavior. Setting spending limits and restrictions on expense categories at your organization is a great start. At the same time, data mining is the cornerstone of analytics, especially for Amazon Business expenses.
Data mining is key in discovering different types of fraud whether it’s an overpayment, unauthorized use of the organization’s card or account, or a potential personal expenditure. Overall, doing this will enhance the efficiency of your card program’s expenses review process all around.
Educate Employees on Amazon Business Expenses and Best Practices
It’s important to realize that most employees will not intentionally be trying to misuse or abuse the organization’s Amazon Business account. The solution is to properly educate them on the dos and don’ts of using the account. Consider the following actions to effectively communicate the appropriate use of your payment method:
A Policy Makeover Begin by updating your expense policy so that Amazon Business is treated just like other company payment methods.
Vendor Selection If you would like employees to use only certain vendors through Amazon Business, be sure to communicate that.
A Clear Understanding of Policy Also, make sure that employees know they can’t use the Amazon Business account to resell items or ship gifts to customers or clients. Of course, personal use of the Amazon Business account is also prohibited.
Refresher Training See if you can arrange a training session to go over how to properly use the Amazon Business account. A brief training video focused on the specific policy topic can encourage new and existing cardholders to follow policy and to understand the importance of continuing policy compliance.
Utilize the Benefits of Machine Learning
Machine learning takes data that is mined from company purchases and processes it further using an algorithm that can determine trends and patterns over time. Machine learning can even aid in detecting fraud and potential abuse beforehand.
By further analyzing spend data, it will ‘learn’ the behavior trends. Then, it creates sets of data, rules, and alerts to help you stay on top of potential fraud and abuse to prevent it from becoming a bigger problem. The best part is that given its name, this system is completely automated requiring very few human controls.
Embrace Amazon Business With the Right Expense Monitoring Tools
Are you looking to step into all the benefits of Amazon Business or an alternate payment method without getting overwhelmed when it’s time to monitor expenses and prevent fraud? To adjust to this ‘new normal’, you’ll need to expand the reach of your internal expense monitoring system. Card Integrity offers all the tools to help you do this.
Data-Wise, Card Integrity’s spend monitoring tool, can carefully monitor the entire spend for your organization. Plus, it can look for purchases that were made on the organization’s business account and provide an alert of suspicious activity.
When it comes to training your employees on Amazon Business expenses, consider our Training-Wise service. Shift your focus to other areas while we create a custom online training course for your team.