Tips for confirming vendor legitimacy.

• Author: Marshall, Jeffrey
• Position: Fraud - Brief article

Fraud is a vastly underappreciated challenge, says Jim Arnold, president and founder of APEX Analytix, a provider of accounts payable auditing, procurement and spend analysis and audit software. He offers the following tips to prevent accounts/payable fraud:

* Confirm Vendors' Existence in the Public Domain. Ensure that new vendors are legitimate entities and not shell companies or phantom vendors by confirming their existence in the public domain. There are numerous free Internet research tools available, including 411locate.com, anywho.com, dexonline.com and infospace.com. Several reputable subscription services exist for this purpose as well, among them ChoicePoint, Dun & Bradstreet, Hoover's and Austin-Tetra.

* Match TINs with IRS Records. Available through irs.gov, the TIN (Taxpayer Identification Number) Matching Program matches a payee W-9 name and TIN with IRS records. By confirming that new vendors are indeed taxpaying entities, you reduce risk of vendor fraud by phantom vendors.

* Develop a Vendor Profile Form...