Apparently business travelers are really just fraudsters. Awesome.

Yesterday, CNN had an article about business travelers and expense reports that got me pretty riled up. The point was that people are getting creative about how to cheat the system, even going as far as buying fake receipts online and then filling them out to be reimbursed.

“Those items can include everything from an “accidental” use of the company credit card on a business trip to purchase a suit coat to listing every single can of soda or pack of chewing gum purchased.”

“Bachman heard of one instance where an employee frequented a certain restaurant franchise and asked for receipts so often, they gave him a pad of them. The employee would turn in fake receipts for lunches he never had. He was only caught — and fired — when he began turning them in for locations where the franchise didn’t exist.”

Yep–this is bad. Falsifying receipts or having your company pay things that are out of policy are ethically wrong, in my opinion. Although I’m really surprised that they think listing every pack of gum or can of soda is a sign of fraud.  My company allows me to spend X on food every day, and many days I don’t even come close. Soda and chewing gum count as food, so I list them to get reimbursed.

“One woman was immediately fired for putting a $9.95 hotel room movie rental on a business travel expense report, according to Peter Goldmann, president of fraud-prevention consulting firm FraudAware.”

Are you kidding me? They had an employee they spent probably thousands of dollars training, and who they value  enough to send to various locations to represent the company, but they fired her for $10? I’m sure this is just a tiny piece of the story, but I certainly hope that they at least asked her if she meant to put it on there or if it was a mistake. You would think she could just reimburse the company for it and all would be well. And there is a huge difference between this and the people who buy fake receipts online.

“So just what are employees getting away with on their expense accounts? Upgrading hotel rooms, excessive taxi rides, double-billing for plane tickets, seats and baggage fees, luxury rental cars, fake lunches and dinners, layovers for personal visits and heaps of laundry on overnight trips, according to Goldmann, Geron and Bachman.

Um, baggage fees, really? I am a huge advocate of carrying-on your suitcase, but if you can’t, your company should pay for it!!

“”There are a million different ways to game the system,” Goldmann said. But the fallout could ground high-flying business travelers.”

I’m sure they are right–there are probably lots of ways to game the system, and I’m sure people do it. But I feel like the overall tone of the article makes it sound like we road warriors have a glamorous lifestyle, with fancy food, first class seats, upgraded hotel rooms, and luxury cars. My last trip I stayed in a Hilton Garden Inn (perfectly fine but hardly a luxury hotel), flew coach (and didn’t get my upgrade), ate at fast food places and the hotel (because I had no time), and drove a Ford Focus. Hardly “high-flying”. It makes me wonder how many actual business travelers this writer spoke to. Because he certainly didn’t seem to have a whole lot of personal experience!

The comments to the story are particularly enlightening.

So, Readers, what do you think? My opinion is that fraud is bad (duh) but your company should pay for things in its policy while you travel. Yes, this includes gum. And water. And laundry, if necessary.

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Comments

  1. I think you are misinterpreting about baggage fees and laundry. The sentence was poorly written but the author meant something different.

    Baggage fees should be read with the line about double-billing. In other words, employees are getting away with double-billing for plane tickets, double-billing for seats and double-billing for baggage fees.

    As for laundry costs, I think the author was implying that employees were charging for 10 days worth of laundry when the trip was only a one night (overnight) trip.

    It is hard to tell from the run-on sentence but I think this is what the author meant. 🙂

  2. This sounds like an article from 1996. I know I’m in the minority, but I fall on the very conservative side of business expenses. Usually I only put in for major meals (such as dinner) in addition to the basic expenses of airline ticket, hotel and rental car. I don’t ask for reimbursement for my morning Starbucks, because I’m going to pay for that if I’m at home or on the road. Because I work in HR and may have to fire someone over things such as excessive travel expenses, I believe that I have to model the conservative example.

    These days it seems like it would be really hard to falsify significant expenses like double-reimbursement for airline tickets. My company requires use of the company card, and everything must be justified with unique receipts. Only very small cash outlays (say $10 for a taxi) will be reimbursed, and even then a receipt is required if at all possible. Plus everything is scanned and submitted on-line, and the computers do significant cross-checking of receipts, etc.

  3. Consultants at my old firm told a story about one client who insisted on itemized receipts before processing any monthly invoice. They paid for many dinners at mid-priced restaurants without batting an eye, but freaked out when one consultant expensed a pack of gum at the airport. Their rationale: We are paying you hundreds of dollars an hour, which means you can afford to buy your own gum. Another client balked at a “steak dinner” at TGI Friday’s (probably one of the cheapest steak dinners ever). It goes to show, reactions are not always what you expect, and a written policy to follow would be very, very helpful!

  4. Having worked for a couple of Fortune 500, one of the first talks I have with my sales managers, account executives or other people that take business trips on a regular basis is basically “if you have to cheat on your expense reports, do us both a favour and start looking for another job”…

    When you need to sign off more than two dozen expense reports, you simply don´t have the time to go thru all the detail. A lot of trust needs to be involved and I found that little talk to be rather effective.

    On a humourous note while on a business trip to Argentina I got a call from one of my regional managers in Rio de Janeiro informing that he was about to spend the night on one of those “love” motels as he couldn´t find any other accomodation. After a good laught I approved the expense without hesitation, althought I sure it raised a few eyebrows in the finance dept. 🙂

  5. I went and read the full article, and you are right that it is poorly written and edited (as are some of my comments above – sorry!).

    I work in a highly regulated industry, but I find it really hard to believe that many people have a “gift” allowance in their travel budget. That seems so old-school, but maybe it is still common in other industries. Also, layovers or early arrivals/late departures should be o.k. as long as (1) it does not significantly change the cost of the overall ticket, (2) the employee pays for any additional expenses for that personal time out of pocket, and (3) submits for any appropriate vacation or comp time.

  6. that is a LOT of extra effort to cheat the company of that much money. i HATE doing expense reports – keeping track of all my receipts even if they were paid for using the company card, entering each item one at a time into the system, having to pay everything up front until i get reimbursed by the company, etc. most of the time, i cheat myself of getting reimbursed when i misplace a dinner receipt or forget to write down all the little $7 taxi rides between the hotel and the office. of course, i find the receipts stuffed in one of my suitcase pockets a month later…

  7. I think it is unfortunate that they generalize business travelers like this…”If they have to travel on their own time for the company, employees are looking at quality over saving money and pampering themselves rather than succumbing to the dirges of business travel.”

    Many people sacrifice family time and travel like they are paying for the expenses them selves. What makes them think they can generalize business travelers like this?

  8. I read the article earlier today and had a similar reaction. When you are traveling around the world managing possibly millions of dollars in business, then it seems that gum receipts are not how you might go about systematically screwing your employer. But I realize how these things can be easily misunderstood by someone in accounting who might not have travelled extensively, and possible not at all for business.

    I always tell them that if there are any questions, please ask rather than jump to conclusions. If I do a lot of laundry in Korea, it’s because everyone I work with there smokes, and every night we are cooking our food at the table. That’s a good reason that someone might not think of if they hadn’t been there, and were only looking at line items on a hotel bill.

    I also have to work at being patient in these discussions, because after spending 10-14 days away from my family on a particularly arduous trip, it is hard to play “defendant” without getting really frustrated.

  9. I’ve seen and heard about plenty of unethical expense-related activity in my time. Not to mention just wasteful expensing. I worked on a year-long project where part of my job was analyzing the billing code which included expenses as well as billed time. Some of the things I saw made me want to run away and find another job. Lack of ethics in business expensing is a real hot button for me. Yes, we are away from families for days or weeks at a time. That doesn’t entitle us to use bad judgment or worse, effectively steal from the company.

    Every company is different, but where I work, there is a lot of wasted money on expenses. I’m really frugal, but I’m in the minority.

    And I’m sorry, but chewing gum is not food.

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