By Rory Choudhuri, Finance Transformation Evangelist, Soldo
Earlier this year, we witnessed yet another development of how GenAI can be fraudulently deployed, after someone used ChatGPT to generate what- at first glance- looked to be an entirely legitimate fake lunch receipt. For those in the finance and HR sectors, alarm bells started ringing. Had this been submitted to a real organisation, it would’ve been difficult to criticise a busy finance team for processing it without a second thought, mistakenly reimbursing a fraudulent claim.
For all we know, many may already have done so. It certainly poses a serious question: as we enter a new era of business, increasingly defined by automation and digitalisation, how can we ensure that employees aren’t exploiting it for personal financial gain?
Ancient practice: new problems
Expense fraud is hardly new. It’s as old as organised work itself; from the days of Ancient Egypt, where historians believe some foremen inflated rations for phantom workers, to modern-day exaggerated mileage claims and fictitious client lunches. But AI introduces a level of realism, scale and speed we haven’t faced before.
At the same time, many businesses are – rightly – moving away from centralised control and giving employees more autonomy over how they spend company money, within specific guardrails. In fact, recent research found 78% of finance leaders trust their teams with company funds, and many of them and employees alike cite increased agility, motivation and productivity as a result. But this trust must be matched with tools fit for a world being transformed by GenAI.
Arming up to combat expense fraud
The reality is that traditional expense processes, built on manual audits, retrospective checks and policy PDFs, won’t keep up. If you’re relying on post-spend review to catch fraud in an era of AI-generated receipts, you’re already behind and stuck in firefighting mode. Unfortunately, fake receipts are a symptom of ineffective spend management.
To stay ahead, finance teams need to shift from reactive to proactive. This means adopting technologies that can identify and prevent fraud before it happens. Tools that scrutinise image metadata and flag anomalies, examining photos for patterns that indicate the image has been generated using AI, should absolutely be part of the business’ arsenal. Deploying an automated spend management platform can help mitigate the risks associated with the misuse of AI. It can automatically review and verify receipts, track spend in real time and apply consistent guardrails no matter who’s spending.
Looking forward and embracing change
Adopting the right tools is a great first step. However, to maximise the benefits, companies must also adopt the right culture. Key to staying ahead is balancing trust and autonomy, underpinned by transparency and intelligent controls.
Empowering teams to use new tools, while implementing proper governance, can also stimulate growth for teams beyond just combatting AI-enabled fraud. By clawing back time otherwise spent on manual tasks like reviewing receipts and expense reports, finance teams can offer more when it comes to forecasting and financial strategising.
Generative AI is causing shockwaves quicker, and on a larger scale than most companies can adapt to. But new challenges also bring about new opportunity. With a considered, strategic approach, it can be an agent of change for revolutionising financial operations and building more advanced and sustainable solutions, ensuring the continued growth and evolution of the finance and HR industries at large.
