Current cyber fraud defenses were built for a different era.
Finance teams have always sought to stay ahead of fraud by strengthening manual verification processes, implementing multi-layered approvals and educating employees on emerging schemes. However, these strategies were effective because they matched the threat: human fraudsters operated at human speed with human limitations. AI has eliminated those limitations. Attacks now learn from failures, adapt in real time and scale across hundreds of targets simultaneously.
This pattern has accelerated dramatically, and with every iteration of payment methods, AI-powered fraud attempts become more sophisticated and harder to detect.
According to Trustpair’s 2025 Annual Fraud Report, 90% of U.S. companies reported being targeted by cyber fraud attempts last year, and nearly half of those lost more than $10 million. Despite the systemwide threat, 90% of executives have high confidence in their company’s ability to detect and block fraud. We see this overconfidence reflected in the constant push for training and education, as well as the use of manual prevention processes. Neither can stand the test of AI-powered fraud on their own.
Why it’s happening
Procurement and finance professionals are trained for supply chain disruptions. However, new challenges, such as tariff spikes, shutdowns, sourcing pivots and trade changes, are straining operations. A Maersk survey of 2,000 European shipping customers found that 76% experienced supply chain disruptions that delayed operations in the past year, with 22% reporting more than 20 disruption incidents during that time. Organizations are being forced to onboard new vendors at a heightened pace, often bypassing procedures and processes that were already manual and vulnerable, to begin with.
Executives are aware of this challenge, as Trustpair’s report found that a quarter of executives believe that changes to supply chain or third-party relationships will most likely increase the risk of payment fraud. Beyond that, 47% point to economic volatility and 31% to geopolitical uncertainty as the factors most likely to drive higher payment fraud at their companies.
Why confidence doesn’t match reality
Simultaneously, fraudsters have changed their tactics, making fraud attempts nearly impossible to detect with traditional prevention methods. While fraudsters still use traditional channels like business email compromise (BEC), they do so with the aid of AI, making schemes more efficient, convincing and undetectable.
Additionally, AI has created new avenues for fraud, such as deepfake video conferencing calls. Nearly 24% of companies reported experiencing fraud related to generative AI, while 63% identified BEC as the primary method of attack, with some incidents even occurring through video conferencing tools. AI enables attackers to scale their operations significantly across various technologies, and there is hardly any channel of fraud these days that remains unaffected by AI involvement.
Despite these evolving threats, many companies still rely on manual prevention methods. According to the same study, 69% use callbacks or email verification for bank account changes, while only 31% leverage automated account validation tools. This reveals a disconnect between confidence and actual readiness.
Where the exposure lies
Most companies focus on safeguarding payments, but vulnerabilities also happen earlier in the workflow. Over half of companies feel more vulnerable to payment fraud during supplier onboarding, 65% when a supplier requests credential changes, and 64% when a new invoice is submitted. Despite this, only 8% of companies maintain consistent vendor verification across the entire procure-to-pay (P2P) process, leaving them exposed to significant fraud.
Fragmented ownership adds to this risk. When vendors are passed through procurement, accounts payable, treasury and compliance, each handoff creates a blind spot for fraudsters to attack. Nearly half (48%) of companies reported that siloed processes hindered collaboration last year. The reality is that vulnerability (and fraudsters) exist at every stage. Prevention strategies must do the same.
The dual cost of exposure
Not only does fraud escalate financial losses, but it also adds to reputational damage. Executives worry about the collateral damage to corporate relationships and brand reputation. They fear fraud will erode the trust of customers (53%), investors (49%) and suppliers (48%).
The combination of major financial losses and reputational harm demonstrates how fraud has evolved from an operational concern to a business risk that requires executive-level attention.
Essential steps to close the gap
The first step? Shift from manual controls to intelligent automation supported by human expertise. Your team should focus on critical assessments and executive decisions, rather than routine validations that technology can handle with greater speed and accuracy. The most effective defense against automated fraud is to fight fire with fire: build automation into your security foundation.
● Integrate automated account validation. Real-time verification of vendor bank accounts throughout the procure-to-pay cycle blocks most impersonation scams before they reach human review.
● Establish centralized risk visibility. Unify procurement, accounts payable, treasury, and compliance data into a single dashboard that monitors every transaction touchpoint.
● Maintain consistent validation checkpoints. Verify new suppliers during onboarding, flag credential changes immediately, and validate invoices before authorizing payment.
● Deploy layered defenses strategically. Let automation handle high-volume screening while directing human judgment toward high-risk cases flagged by the system.
● Elevate fraud prevention to a strategic priority. Assign cross-functional ownership, conduct regular audits, and ensure prevention protocols are enforced rigorously across all departments.
What leaders should do next
Sweeping U.S. tariff announcements that began continue to shape global supply chains. Each policy shift forces companies to rapidly pivot suppliers, restructure sourcing networks and onboard unfamiliar vendors under time pressure. This is precisely when fraud prevention breaks down.
Finance and procurement leaders must act decisively. Elevate fraud prevention to a board-level strategic priority with unified ownership across procurement, treasury and AP, eliminating the silos that create blind spots for fraudsters. Deploy automated account validation throughout the entire P2P cycle, not just at payment. Most companies focus their verification efforts on the payment stage, while leaving significant exposure during onboarding, credential changes and invoice processing.
Neither supply chain volatility nor AI innovation shows signs of slowing. The only long-term response should be building fraud defenses that operate at the same speed and scale as the threats themselves.
