Fraud Management @ WebXpress

Solution Features and Suggested Processes

Outline

• Road Transportation alone accounts for more than 50% of logistics spend• Over 50% to 70% payments for transportation movement is in CASH

TRANSACTIONS

• As per Transparency International, over 22000 Cr. Of bribes are paid by transporters on Indian highways every year

• Thus, the sectors is highly prone to frauds and leakages• This presentation outline some of the methods used by employees/

vendors/ customers to defraud transportation companies

• The presentation also discusses role of WebXpress Solution to prevent some of the frauds and put in place processes to ensure accountability of transactions

• WebXpress does not claim to solve the gargantuan problem of corruption in the sector- but can help its customer protect themselves to best possible extent

Transportation- riven with corruption

Various Reasons cited by truckers for stoppages by Authorities

20% of working time spent in paying bribes

Fraud Examples- Never told, never heard

It could happen to you !!

• A leading courier company recently found that over Rs. 70 lakh worth of To Pay and Paid cash was never submitted to company and was pocketed by employees

• An express cargo company found that a bets performing region was actually making ghost booking and deploying ghost vehicles with real money taken from HQ

• A fleet company found that their vehicles in return journey were showing very low yield but were actually full of goods of outsiders

• A parcel company in India’s hinterland found that employees were collecting more amount than reported and were reporting gap as customer deduction

• Many such examples are bound and India is not alone in such cases. Here is a report from PWC showcasing global fraud in Transportation Industry:

How WebXpress Prevents leakages!

How WebXpress prevents fraud

Fraud Description How WebXpress helps

Under reporting of

load

Booking clerk will report weight as

400 Kg when it is actually 600 Kg. 200

Kg. moves free at company expense

and booking clerk gets a tip from

customer

• Random check of arrived consignments for weight and

volume

• Report DEPS in case of gap and system will raise a TICKET

• Analysis of tickets will help to find branches with

maximum issues

Market vehicle in

place of own vehicle

Branch places market vehicle even

when own vehicle is available.

Branch gets a cut from market

vendor.

• GPS on own vehicles will show where they were at the

time of placement

• Job sheet will show whether vehicles were actually

under maintenance

Market rate higher

than actual

Branch places vehicle at rate higher

than available in market and pockets

the difference

• Use WebXpress TAM module to approve every

placement

• TAM will show past tend of rates for same lane

• Also, random calls to market brokers will provide real

rate

How WebXpress prevents fraud

Fraud Description How WebXpress helps

Extra placement Branch places more vehicles than

required stating more stock or urgent

service request.

• Monitor vehicle load factor and raise alert for low load

factor

• Work out schedule of vehicle placement and block a

schedule once used

Ghost vehicles No vehicle is places and dummy

documents are created

• Insist on system generated Challans.

• They require system entry of LR and LR requires real

load.

• Do not allow same vehicle number once used till the

time it is freed at another location

Multiple payments for

same vehicle

Vendor submit same challans

multiple times over time and get

payments

• Vendor bill is booked in system before payment

• WebXpress never allows same challan to be booked

more than once- EVER

How WebXpress prevents fraud

Fraud Description How WebXpress helps

Request for more cash

than needed

Branch asks for cash for expense on

advance, conveyance, office expense etc.

even when they have cash in hand

• WebXpress provides ONLINE view of CBS of each

branch and also of collection outstanding

• Branches will get advance based only on online

balance. If branch has not updated system, more

cash will show

Late collection or non

reporting of paid and

to pay

Branch does not collect payments in

time. Or it actually collects but does not

report.

• Paid and To Pay outstanding reports will help HO

focus on collections

• Daily SMS alert can be sent to branches for collection

of outstanding

Wrong reporting of

deductions for cash

collection

Branch collects Rs. 3000 but reports only

Rs. 2500 were collected and show gap as

deduction

• Send SMS/ e-mail to customer stating collection and

deduction amount

• Also send help line number if he feels wrong data is

sent

• This will ensure HO will know wrong deduction as

customer will not accept wrong data

How WebXpress Prevents leakages!

Leakages

• Not all loss is dues to frauds, a much larger amount of loss is due to leakages and inefficiency of operations

• WebXpress can be used to build practices that will prevent or reduce many of these leakages

• Needless to say that organizational practices need to be aligned with WebXpress system for best results

Prevention of Leakages

Leakage Description How WebXpress helps

Late billing LR remains unbilled for a long time due to

various reasons- POD non arrival,

comments by customers, large volume

etc.

• WebXpress can be used to scan POD and start audit as soon as

delivery is completed

• PODs that are audited can be parked as APPROVED FOR BILLING

• Thus, bill can be expedited quickly and bills submitted once

PODs arrive

Late submission Bills are sent to branch but not submitted

to customer in time

• WebXpress can be used to note submission details. It can then

be used to track unsubmitted bills

• Also, bill acknowledgements can be forwarded with a scanned

copy

• Electronic bills can be submitted to customers where

acceptable

Bill rejection Bills are rejected by customer due to

wrong contract details, wrong rates.

Many a times contract is revised but bill is

made with old rates

• All contracts can be entered in system and LR can get rates

automatically. If contract is expired, LR can not be made

• This will ensure that bills are correct and rejection is minimized

Prevention of Leakages

Leakage Description How WebXpress helps

Recovery of deduction s Customer provides details of deduction

quite late. If the same is not

investigated, it can happen that wrong

deductions are made

• WebXpress recovery module tracks every deduction against

every LR

• This also helps customer work with customer and recover

amounts where possible

• This can be recorded against the LRs

• Also deduction by customer can be recovered from vendors

or employees

Rate enforcement Users enter the rate as they see fit to get

business from customer. This results in

loss to company

• Standard contracts, yield limits, minimum charges, weight etc.

can be entered in WebXpress system

• LR entry can then be done only in accordance with contracts

or standard rates. This will ensure minimum business for

company at no loss

Last mile cost control Delivery to customer premises from hub

is last mile delivery. Many a times

delivery cost per Kg is much higher

• WebXpress can be used to focus on pick up and delivery cost

per Kg.

• This will help to ensure that there is no excess payment in

last mile

Prevention of Leakages

Fraud Description How WebXpress helps

Vehicle

Underutilization

Branch/ Hub places vehicle with less than

optimum load due to “operational reasons”

• A rule can be set that any vehicle must be

utilized to say at least 70% of capacity, else

approval needs to be granted

• Cost per KGKM rule- the cost and load in

vehicle should be such that it meets cost per

KGKM criteria protecting margins

Underutilized route

segments

In a multi-point route, a particular segment is

run less than optimum

• WebXpress route analysis can help to monitor

trend in segment wise usage of a route

Thank You

info@webxpress.in www.webxpress.in

KEEP IN TOUCH

Headquarters Regional Sales Office

114, Sundervilla, S. V. Road,

Santacruz (West), Mumbai – 400052

+91 93 232 428 02

+91 22 325 735 60

ECFY Consulting Pvt. Ltd.

107, First Floor, Suncity Trade Tower,

Sector–21, Gurgaon – 122001

+91 93 117 363 59