Recently, a Papa Johns franchise came under fire for alleged fraudulent Eat Out to Help Out scheme claims totalling over £250k. These meal discounts got allegedly processed despite there being no button on the till to accept the transaction. And often with several orders sent in a minute. So, it got us thinking. How important is using IT systems to prevent internal fraud & process breaches to small businesses? Read on and you’ll see how using robust architecture and automated fraud reporting helps. You could prevent something like this from happening in your business.
Why you need a SARI
Sense and respond infrastructure is a complex series of systems that looks to use event-based triggers to alert of suspicious behaviour. According to IEEE, it’s “architecture and components for a real-time fraud management solution which can be easily adapted to the business needs of domain experts and business users. The SARI system provides functions to monitor customer [behaviour] as well as it can steer and optimize customer processes in [real-time].” If Papa John’s had deployed a robust SARI, it’s likely these transactions would have been flagged immediately by automated systems.
What a SARI looks for
Consider the Papa John’s example, a SARI could have automatically identified the risk factors. One risk is the processing of undefined transactions. The system did not have a till button for Eat Out to Help Out. So these transactions were likely processed as a miscellaneous or similar undefined charge. Large volumes of unusual transitions ideally would get flagged immediately for central review.
Also, many transactions went through in an unreasonably short period of time. According to the Daily Mail, “In one week in his tiny Tunbridge Wells takeaway store – where there are no tables – 368 orders for the [eat-in] offer were processed. All but five of them were for exactly £20.99. This included 49 orders in just one minute on the stroke of midnight in a store not large enough for ten people to stand in, let alone sit.” But a SARI could accept defined parameters for reasonable time per order. And flag any order flooding experienced for central review.
Is a SARI right for your business?
Probably. According to NatWest, “Fraud costs UK business £190m a year. More startlingly, about 40% of that figure is stolen by staff.” While this alleged fraud was perpetrated against the British taxpayer, the point remains the same. Robust SARI systems help to identify risks faster and flag potential fraud to the appropriate departments. But had Papa John’s had the correct measures in place, it’s likely they would have caught these issues right away. And the undefined transactions or high volume per minute orders are an example of two issues that SARI systems can scan for in real-time. So, it’s probably worth considering.
With fraud a real risk, you need to get protected. The best way to limit the damage is with a robust SARI. If you’d like to talk about your business process monitoring, our expert team is ready to assist.