How to Fight Fuel Fraud in Construction Companies

Is your construction company a victim of fuel fraud?

The chances are high. Fuel theft by employees is a common occurrence, and it could be hurting your business more than you realise. 

According to a ‘Fraud Matters’ global study conducted by Shell, as many as 93% of fleet managers believe that some drivers are involved in fraudulent activity. 

Worse, more than a quarter of drivers have admitted to witnessing deceitful activity at work. 

Research carried out by Fleet News in the UK confirmed that two-thirds of fleets have been the victim of fuel theft or fuel fraud – and that’s only those who know that fraud was taking place. 

Many more remain in the dark. 

With fuel prices rising, more drivers are likely to be tempted to try to hide personal fuel costs in company fuel purchases.

There’s never been a more critical time for construction companies to put simple checks in place to identify and eliminate fuel fraud completely. 

Types of Fuel Fraud

The first step to preventing fuel fraud is to understand the different types:

Mileage Creeping: Drivers inflate mileage figures on fuel reclaims when a personal or mixed-use vehicle is being used. It is one of the most common forms of fuel fraud in companies.

Fuel Deceit: This could be fuelling a non-fleet vehicle or where the driver pumps fuel into a separate can for personal use and pays using the company card. 

Fuel Card Fraud: Drivers may inflate fuel card transactions, share fuel cards with unauthorised people or share PIN numbers between drivers. 

Fuel Type Fraud: The driver purchases the wrong type of fuel for the vehicle (e.g. diesel for an unleaded petrol car), which is a sign that the purchase has been made for a non-fleet vehicle.

Fuel Syphoning: When fuel is removed from the tank of a fleet vehicle for personal use, this is fuel theft.

How to combat fuel fraud 

In the Shell research, 48% of fleet managers agreed that improving practices to tackle fuel fraud could reduce fuel spend by 5% or more. So, it’s worth implementing anti-fraud strategies to save on fuel costs. 

There are multiple ways to crack down on fuel fraud in your construction company. 

The number one tactic is simple:

Fuel cards. 

Fuel cards offer lots of ways to control spend, limit users and, most importantly, delve into transaction data to identify unusual behaviour. 

Take a look at how fuel cards can help you fight fuel fraud:

Allocate Fuel Cards

The great thing about most fuel cards is that they can be assigned to a driver or to a vehicle. 

By assigning a card to each driver, you can easily track who made each purchase and spot discrepancies. Only that person is authorised to make fuel purchases and they are answerable to all transactions.

Set some limits

With fuel cards, you can set limits and controls that help prevent fraud. 

1)    Limit the fuel amount. Set a maximum amount of fuel a driver can purchase each day with the fuel card.  The goal is to give your drivers enough to fill up the fleet vehicle tank without any room for fraud.

2)    Limit the number of daily fuelling trips a driver can make. How many times a day should your drivers be refuelling? By limiting the number of fuel purchases, you can prevent both internal and external fuel fraud. For example, if a driver refuelled and then accidentally lost the card, a fraudster wouldn’t be able to use the card on the same day. 

3)    Limit the fuel type. If your vehicles only run on unleaded petrol, you can only allow the purchase of unleaded petrol.

4)    Restrict fuelling days and times. For example, allow fuel purchases during on-the-clock hours and prevent them on evenings, weekends, and holidays. 

Tap into comprehensive reporting 

Is your accounting team relying on receipts and bank statements to cross-check fuel usage and spend? 

Not only is this incredibly time-consuming, but there’s very little guarantee you’ll spot all incidences of fraud. 

Instead, choose a fuel card that offers comprehensive reporting, so you can easily see mileage, fuel purchases and other vehicle data in one place. 

Fleet Card makes it easy to see discrepancies and unusual driver behaviour with exception reporting. You can view incidents where the card purchase exceeded the vehicle’s tank capacity, the driver purchases fuel multiple times on the same day, or when the fuel was purchased on a Friday, Monday or weekend, plus many more. 

The best part is, you can choose to get notified by email when there are peculiar transactions and behaviours, which allows you to investigate the fraud sooner. 

Educate your drivers

Fuel fraud is a criminal offence yet some drivers may not understand how serious it is. 

Make sure all drivers know the consequences of fraudulent actions and the various methods you use to monitor fuel spend. 

Some drivers may not understand what constitutes fraud, and may actually think that some behaviours are acceptable. Use periodic training sessions and regular communications to ensure drivers know how to properly use their fuel cards. 

Over to you

With fuel costs representing a substantial portion of business expenses, it’s critical for businesses to put strategies in place to identify fuel fraud and, ultimately, eliminate the risk. 

Choosing the right fuel card is an important first step. Talk to our expert team about how Fleet Card can help you combat fuel fraud and save your bottom line.