Email Mining For Fraud Detection: Loss Prevention At Its Finest

If you’ve ever dealt with a sales rep who used the company email to engage in nefarious activity, you know firsthand how detrimental this can be to your company, particularly financially. Chances are, you uncovered the problem a long time after the damage was done. As you know all too well, the impact that deception and fraud have on your business is real. If you’re serious about your company’s success and reputation, you need to outsmart the perpetrators of these fraudulent activities.

Prevalence of Occupational Fraud

So just how big of a deal is fraud? Within the company, occupational fraud is responsible for 5% of the organization’s financial loss each year. The median amount of loss is $140,000.  And in more than 20% of cases, there’s been over $1 million in loss. If that blows your mind, here’s something even crazier: the majority of fraud is off the radar. For those rare cases that are detected, it’s often times uncovered by accident.

Tackling Fraud Head-On

As an executive, your main priority is your company’s performance and success rate. Why would you want to leave fraud detection to chance? Get ahead of the fraudsters and schemers with a proactive fraud detection approach that uses concept tagging to identify the 3,000+ keywords and phrases. The databahn Concept Tagging API can be used to pinpoint the exact emails containing the nefarious communications.

I’ve said in my previous post that you are sitting on top of an e-mail gold mine. This is a compilation of all interactions your salespeople and customer service agents have had with customers and prospects. You’re looking at potentially 100s of thousands or millions of e-mails. Using e-mail mining and concept tagging, you can tag or red flag concerned emails by inputting some of the thousands of words and phrases associated with fraudulent activity. These include “cover up”, “write off”, and “off the books”, just to name a few. This will allow you to pinpoint these key terms throughout the email text.

databahn fraud detection word cloud

You can detect fraud and other suspicious activities by compiling and sifting through the unstructured data (i.e. emails), distinguishing and separating the fraudulent content from the ordinary emails. This allows you to uncover the destructive activities and communications as they’re happening… not once they’ve happened (it’s too late!). The truth of the matter is that anyone could be involved in fraud – even the people you trust the most.  This includes employees, managers, and executives. It may hurt to discover someone that has betrayed your trust, but it’s better than feeling the pain financially.

Identifying The Perpetrator

You’ve probably heard the saying “keep your friends close, and your enemies closer.” Before you jump to the conclusion that your nemesis is the newest person on your sales team, the perpetrator could be closer than you think. Get this – the longer a scheming employee works for you, the more money will be lost. And you shouldn’t be quick to dismiss your precious salespeople. In fact, a recent study showed sales and customer service were two of the six departments that combined accounted for 77% of all losses. Isn’t that disconcerting?

You need to think about taking a proactive fraud detection approach to effectively prevent financial loss. Why do you need it? Because your bottom line depends on it.