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Invoice bot fights back against fraud

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25th Oct 2016
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*Edit - Dec 2016 - since publishing this article we have received notification that Invoice Scout, the company profiled in this article, have shut down. More details are on their website *

Technology has always played a role in the fight against fraud, but now an artificial intelligence-powered bot is joining the fray.

The latest rise in email invoice substitution fraud covered by AccountingWEB left many accountants wondering how best to fight back.

One option is to download invoices directly from suppliers’ websites or portals rather than opening an email attachment, but jon_griffey commented, “It is time consuming having to log into every supplier portal, remember the password and navigate the site to try and find the invoice. Multiply that by several invoices and it is sucking up a lot of time. There must be a better solution.”

Invoice ‘Hoover’

One solution to this problem comes in the shape of Invoice Scout. This start-up web application is being presented as an AI-powered invoice “Hoover” for those dealing with numerous supplier accounts.

Subscribers log into Invoice Scout’s platform, decide which suppliers to query and log in using their supplier credentials. The Invoice Scout bot then automatically navigates the supplier’s website, extracts invoices as they are issued and emails them to the user via a secure account. Users don’t need permission from the supplier – in fact suppliers are unable to tell that Invoice Scout is being used.

invoice scout

“It’s basically like having an electronic assistant,” said the Invoice Scout co-founder Robert Jelenic. “You can call it a bot if you like, but it’s basically automation. It’s taking repetitive, error-prone, low value-added activities and making them automatic.”

Missing fetch feature

According to Jelenic, at the moment the app has the fetch capability that Receipt Bank and similar competitors lack.

“Once you get them the invoice they can process it, code it, post it to Xero, all that kind of stuff. But they don’t get the invoice into the system themselves,” said Jelenic. “There’s still this massive onus on users to log into customer portals or dig through their in-boxes looking for invoices.”

According to Jelenic, accountants know about scanning and data capture apps like Receipt Bank that mop up after expenses left behind by bank feeds that funnel transactions straight into cloud accounting systems. “The problem is suppliers don’t, and that’s the gap we’re talking about.”

‘Your invoice is ready’

Invoice Scout has been going about nine months, and according to Jelenic the app grew out of frustration with suppliers that weren’t sending invoice emails. Companies like Vodafone, Thames Water and many online subscription services may send an SMS message or email to say, “Your invoice is ready”, but often customers might not get anything until the bank charge.

To access the invoice, users often have to log in to the supplier’s platform, click around and locate the invoice in their billing history.

“One of the reason suppliers don’t send an email is around site security concerns”, said Jelenic. “They say you should be coming to the ‘one authentic source of truth’ to get the invoice, so you never pay the wrong person. The problem is that it offloads a tonne of work to the users.

“I’ve also heard a more sinister argument – if the vendors force you to come to the platform to get the invoice, they’re driving engagement on their app or website, and they’re also getting other opportunities to market to you - flash a banner at the top of the screen stating, ‘Upgrade now for 50% off’ and so on.”

Next steps

Invoice Scout is working on ways to extract invoice from other sources such as email inboxes, but Jelenic said the focus for now is on supplier platforms that cause the most pain because of the large number of web accounts finance teams have to interrogate on a daily basis.

With more and more transaction details being sent electronically there’s more need to validate the details received. Invoice Scout, among other solutions, is just one side-effect of this phenomenon.

Have you found similar solutions to Invoice Scout? Or are there other methods to fight invoice fraud out there?

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Replies (7)

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By programify
27th Oct 2016 10:53

I'm always interested in reading about applications of AI, and in this case it has either been mis-reported (click-bait) or if true, the invoice bot needs to be nominated for this year's lamest and most frivolous use of AI.

Oddly the Invoice Scout brochure website makes no mention of their use of AI.

Meanwhile, in the real world, this is a simple automation tool that solves one problem by creating three others - trusting another company to hold all your account login details, hoping they don't go out of business and hoping they don't get hacked; Because the more successful they are, the more of a target for hackers they become.

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Replying to programify:
Tom Herbert
By Tom Herbert
27th Oct 2016 11:13

Thanks for the comment programify.

I can assure you the article is not an attempt to misreport or mislead. The whole concept of AI, including bots, is fairly fluid, and if in your world this product's offering doesn't qualify then fair enough, but from our perspective it was an interesting use of bot technology to solve a long-standing problem.

It's a fair point about security, but isn't that a problem shared by all providers of cloud services everywhere? And you could argue that the stakes are higher now than they've ever been. One high-profile hack may be enough to put the whole operation out of business.

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By ireallyshouldknowthisbut
27th Oct 2016 15:36

I have a great solution to this problem.

Get your supplier to send you an invoice, and refuse point blank to dick about logging into their portals.

20th Century solutions also work to 21st century problems.

The main guard against fraud is a proper authorisation process for payments. ie someone signs off on it, before its paid for. And by someone I mean the budget holder who has bought the thing. Very old fashioned I know, but it works.

Thanks (3)
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By ShayaG
28th Oct 2016 14:41

Sorry Tom: this is not about AI. This is about automation (what you call a "bot").

AI is largely a concept to do with pattern recognition.

If the "bot" could learn from other websites how to extract invoices from the website of a new supplier even it had not been specifically programmed how to do then there would be a tangential element of AI to this product.

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Replying to ShayaG:
Tom Herbert
By Tom Herbert
28th Oct 2016 15:27

Thanks ShayaG. I'm really pleased that this article has provoked a discussion on the definitions of AI and automation, and how much overlap (if any) there is.

I believe there are learning components built into Invoice Scout to help when suppliers move the location of their invoices, which allows the bot to find them, but whether that's enough to qualify... I'll let better minds make that judgement.

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By james.hartung
16th Dec 2016 13:58

Hi Tom,

Interesting article. I also think that this not about AI and more about bookkeeping automation. Which is also great, as it saves tons of time for every business owner or freelancer or anyone who deals with invoices/bills.

Unfortunately, this month Invoice Scout announced that they decided to shut down. One of the cloud software I use for myself and recommend to my clients is Getmyinvoices.com It's a great alternative to Invoice Scout. They provide a secure and easy way to fetch all your invoices and upload it into different bookkeeping softwares, like Xero, Freshbooks, Intuit, Quickbooks, Bill.com etc.

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Replying to james.hartung:
Tom Herbert
By Tom Herbert
23rd Dec 2016 10:49

Many thanks for that James. Sorry to hear about Invoice Scout - a genuinely innovate use of technology to solve a problem. Have updated the article to reflect this.

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