What is Credit Note Fraud?

Definition

Credit Note Fraud occurs when individuals manipulate or issue false credit notes to reduce payable balances, inflate refunds, or conceal financial misstatements. This can result in revenue leakage, misreported accounts, and increased fraud risk within the receivables process.

Mitigation techniques include implementing Segregation of Duties (Fraud Control), using Access Control (Fraud Prevention), applying Network Centrality Analysis (Fraud View) and Precision and Recall (Fraud View) for transaction monitoring, and leveraging Shared Services Credit Management. Integration with Customer Credit Approval Automation and adherence to proper Customer Onboarding (Credit View) processes further reduces exposure.

Summary

Credit Note Fraud involves falsified or manipulated credit notes to misstate financials, controlled through access restrictions, fraud analytics, credit approval automation, and proper onboarding protocols.