Business credit card fraud: Types and prevention tips

Business credit card fraud costs companies time, money, and control. It appears in many forms, including stolen card details, fake vendors, account takeovers, or unauthorized employee purchases. Each drains cash, exposes sensitive data, and throws off your financial reporting.

What is business credit card fraud?

Business credit card fraud does not always look obvious. It might be a fake vendor charging small amounts that slip through unnoticed. It could be a former employee using a card that was never deactivated. It can even happen when someone manipulates receipts or expense descriptions to cover up misuse.

Unlike personal credit card fraud, which usually affects one bank account, business card fraud can spread across departments and multiple users. It creates gaps in your books, delays reporting, and adds hours of work during your month-end close.

Organizations lose an estimated 5% of revenue to fraud each year. Weak oversight and manual processes make business credit cards an easy target.

Business vs. personal credit card fraud

Business and personal credit card fraud may share tactics like stolen card numbers or phishing. The scope, impact, and prevention methods are very different. Business fraud usually involves multiple users, less oversight, and more financial risk.

Common types of business credit card fraud

Business credit card fraud doesn’t follow a single pattern. It happens in different ways because companies use cards for different reasons, such as travel, vendor payments, and subscriptions. Each of these creates unique opportunities for fraud to slip through.

Some fraud comes from outside your small business. Other times, it comes from the inside. The methods vary, but the goal is the same: unauthorized spending that hurts your bottom line.

Stolen card or card number usage

Stolen credit card fraud happens when someone gets access to your physical business card or card number and uses it to make unauthorized purchases. In many cases, the card isn’t lost or stolen in a traditional sense, just the number is compromised. That’s all it takes for someone to charge your account without your knowledge.

Card numbers can be stolen through phishing, malware, payment system breaches, or even public Wi-Fi networks. Criminals use that information to make purchases online, over the phone, or in-store with cloned cards. The risk grows quickly if your team uses shared cards or emails card details to vendors.

This type of fraud is common because card numbers are easy to capture and difficult to trace. Over 289,000 cases of credit card fraud were reported in 2024, many involving stolen numbers used for business transactions.

The bigger the team, the harder it is to spot these charges. You might not notice until a large, out-of-policy transaction hits your account or a vendor asks about a payment you did not authorize.

Account takeover scams

Account takeover fraud happens when someone gains unauthorized access to your company’s credit card account and uses it to make changes, add users, or spend money without approval. Unlike card theft, this type of fraud does not require physical access to a card. It only takes compromised login credentials to get in.

Most takeovers begin with phishing emails, fake login pages, or malware that captures your login information. Once the attacker gets into your account, they can change passwords, update contact details, request new cards, or reroute notifications. This gives them full control while keeping you in the dark.

You might not notice right away because the activity often happens inside a legitimate account. Card transactions may appear normal at first, especially if the attacker mimics typical spending patterns or keeps charges small. By the time you catch it, thousands of dollars could be gone.

To protect your account, ensure that every user has their own login and uses two-factor authentication. You should also limit who can request new cards or change account settings. Choose a card platform that tracks user actions and flags suspicious activity in real-time.

Ramp helps reduce the risk of account takeovers by enforcing multi-factor authentication and role-based permissions. Each user gets their login, and you can control who can issue cards, approve spending, or update account settings. Every action is logged, so you always have a full audit trail. If someone tries to take over your account, they will hit a wall before they get access.

Fake vendor or supplier fraud

Fake vendor fraud happens when someone tricks your company into paying for goods or services that don’t exist. The scam usually starts with a fake business name, a forged invoice, or a spoofed email that looks like it came from a real vendor. If your team approves the charge without verifying the vendor, the credit card payment goes through, and the funds may not be recoverable.

Sometimes, the fraudster creates a fake vendor and submits invoices for services never rendered. In others, they impersonate an existing vendor by changing the payment details or domain name.

You face more exposure to this type of fraud if your vendor onboarding process lacks rigor or if employees have access to corporate credit cards without clear controls. Fraudsters count on you to move quickly. They design their invoices to match your usual format so that no one questions the charge.

This isn’t a rare occurrence. Invoice and payment fraud led to over $2.7 billion in reported business losses in 2022. Many of these incidents started with fake vendors or impersonation attacks targeting finance teams.

To prevent this, always verify new vendors before processing a payment. Double-check contact information and bank details, especially if something changes unexpectedly. You should build approval workflows that flag high-risk charges and unknown payees. If a vendor does not pass verification, do not process the payment, no matter how small the amount looks.

Ramp protects against fake vendors by giving you control over where your cards can be used. You can restrict card usage by merchant category, flag unfamiliar vendors, and set automatic spending guidelines. If a card is used with an unapproved supplier or outside of your normal purchasing patterns, Ramp sends real-time alerts and flags the transaction for review.

Internal misuse by employees

Internal misuse occurs when employees use company credit cards for unauthorized or personal expenses. Unlike external fraud, the person spending the money already has access to the card, making it harder to detect, especially when the charges don’t raise immediate red flags.

This type of fraud can take many forms. An employee might charge personal meals, split a large expense into smaller ones to avoid triggering approvals or label a non-business purchase as client-related. In some cases, someone may use a company card after leaving the company because their access was never revoked.

You are most at risk when there’s little oversight. If your team shares cards, skips expense reviews, or lacks clear spending limits, there’s more room for misuse. Even small charges can add up quickly when no one’s watching.

To reduce the risk of internal misuse, you should issue individual cards to each employee instead of relying on shared cards. This gives you visibility into who is spending, where, and why. Set clear spending limits based on the employee’s role, department, or responsibility level. You can also restrict purchases by merchant category to prevent unauthorized charges.

Platforms that support individual card issuance make this easier by allowing you to create unlimited employee cards with custom credit limits and controls. These tools automatically flag transactions that fall outside policy, collect receipts, and capture memos, helping you stay compliant.

Phishing and social engineering attacks

Phishing and social engineering attacks use deception to gain access to your company’s credit card information. These attacks do not rely on technical hacking. Instead, they exploit trust, urgency, or confusion to trick someone on your team into handing over sensitive data.

A phishing attack usually starts with an email that looks like it came from a trusted source. It might ask you to update payment details, log in to a vendor portal, or confirm a transaction. The email often includes a link to a fake website that collects your card information or login credentials. Once the attacker has that data, they can use it to make unauthorized purchases or access your financial accounts.

Social engineering takes a similar approach, but it often happens over the phone. A scammer may impersonate a vendor, coworker, or even someone from your finance team. They might say there’s an urgent issue that needs immediate payment. If your team member does not verify the request, they could process a fraudulent charge using your business card.

These wire scams work because they target people, not systems. You're more vulnerable if your approval process is rushed or your team isn't trained to question suspicious messages.

To protect your business, train every employee to recognize signs of phishing and social engineering. They should never share card information over email or phone without verification.

How business credit card fraud impacts companies

Business credit card fraud creates more problems than just unauthorized charges. It affects your cash flow, slows down your team, and increases your exposure to compliance and audit risks.

When someone makes a fraudulent charge, your available credit decreases. Even if the card issuer eventually refunds the amount, you still lose access to funds. That can affect your ability to pay vendors, cover operational expenses, or meet payroll.

Fraud also creates more work for your finance team. You need to identify the unauthorized charge, investigate how it happened, and correct the financial records. If this happens during the month-end close, it can delay reporting and throw off your timelines.

When the fraud involves someone inside your company, the impact on trust can be even more serious. You may need to review internal policies, remove card access, or add extra layers of approval. These changes take time and can slow down routine operations.

Fraud also creates audit and compliance concerns. Failing to catch and prevent fraud could raise red flags with auditors and regulators if you operate in a regulated industry or manage sensitive financial data. It may also lead to penalties or a loss of credibility with stakeholders.

When fraud occurs, you lose more than money. You also lose time, control, and confidence in your systems. That’s why early detection and prevention are critical to protecting your business and keeping your operations running smoothly.

Make fraud prevention part of your daily operations

Business credit card fraud is a real and ongoing threat. It doesn’t just show up in one way or stop on its own. Each type of fraud targets a gap in your process, whether that’s weak card controls, missing approvals, or lack of visibility across teams.

The cost is more than financial. Fraud disrupts your workflow, delays your close, and damages internal trust.

To protect your business, you need prevention built into every part of your spending process. That means issuing individual cards, enforcing policy through automated controls, and tracking spending in real time. It means reviewing vendor activity, locking down high-risk categories, and requiring approvals where they matter most.

Ramp builds fraud prevention into its corporate cards, helping you manage spending without extra tools or checklists. You can set rules for how each card is used, monitor online transactions in real-time, and automate approvals based on your company’s policies. When fraud prevention is built into every swipe, you don’t have to choose between speed and security.