How B2B CFO’s Need to Approach Fraud
- Every B2B payment type faces rising fraud risk, demanding vigilant CFO oversight
- Paper checks remain fraudsters’ favorite target
- AI-driven controls and automated verification help enterprises detect sophisticated scams across all channels.
Fraudsters are known to be relentless in their search for vulnerabilities within any technology or process. Many financial institutions are keenly aware of this; however, the end-consumers generally are not -- particularly businesses.
In a recent PYMNTS.com article, CFOs are warned that no matter what method of payment they choose to utilize -- from digital payments to paper checks -- there are always inherent risks for each of them. Rather than searching for a single “safest” rail, finance leaders must understand where risk concentrates across each method and align controls with broader strategic objectives.
Check Payments: Not Just Counterfeits, Forgeries, and Alterations
The article notes that many CFOs are aware of how fraudsters steal and manipulate checks to extract funds. However, many do not yet grasp the new risks. Information on a check provides critical data including account numbers, routing details, and authorized signatures that can be leveraged for fraud at scale. With new AI tools available, this information can produce hundreds of fraudulent checks within minutes.
Shifting to Other Payments NOT the Solution for Fraud
Additionally, this is no longer just "lone fraudster" scenario. Many organized crime rings are now incorporating check fraud into their revenue streams, creating sophisticated operations and different "departments" -- acquisition of checks, opening drop accounts, mules to deposit, etc. -- that serve as a key cog within their operations.
While checks have their inherent risks, other payments channels are no different. While Automated Clearing House (ACH) Payments are frequently regarded as a more "secure" alternative to checks, they do not eliminate fraud risk but instead redirect it toward different vectors, most notably account takeover and business email compromise (BEC). In such cases, the compromise of a single vendor email thread can lead to legitimate invoice payments being diverted to fraudulent accounts. This risk is further exacerbated by the rise of AI-driven fraud, which enables threat actors to execute highly scalable and increasingly sophisticated behavioral schemes.
Additionally, virtual cards have emerged as a controlled and traceable alternative to traditional payment methods. These solutions provide enhanced spend visibility, single-use credentials, and predefined limits—capabilities that can help mitigate certain categories of fraud. However, organizations must assess whether these programs are fully delivering on their intended level of control. Key considerations include whether spending limits are dynamically enforced or remain static and potentially vulnerable; the degree of transaction-level visibility available, and; the speed at which anomalies can be identified.
Notably, fraud associated with virtual cards more commonly arises from misuse rather than direct theft, underscoring the importance of strong governance and oversight.
Hollistic View of Fraud
For B2B CFOs, effectively managing fraud risk requires a holistic, enterprise-wide approach that extends beyond any single payment method or control point. The primary vulnerability is rarely one isolated failure, but rather a lack of comprehensive oversight across interconnected systems. Fraud can originate from multiple angles—including API weaknesses, inadequate authentication protocols, or breakdowns in reconciliation processes—making it essential for finance leaders to evaluate how these risks intersect rather than addressing them in silos.
The article recommends asking the following questions:
- Where are our blind spots?
- Which controls are assumed rather than verified?
- How quickly can we respond when those assumptions are challenged?
Businesses should consult their financial institution about available fraud detection technologies. Many banks use AI to prevent on-us and deposit fraud. Enrolling in payee positive pay lets businesses verify check details—such as payee, serial number, date, and amount—against accounting records for added security.