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Level 1

How do you handle accounting for bank fraud?

We had someone use one of a cards to purchase something.  it was fraud and we got the credit back.  Just wonder how this is usually accounted for.  What GL do you put the expense in (the one the expense would normally be for?).  and then when we get the money back, we do a deposit int the reverse?
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Best answer April 06, 2019

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Level 9

How do you handle accounting for bank fraud?

I would create an expense account and name it "Fraud Expense" and I would post both the credit card charge and the credit card credit to this account, this will net to zero. Then you will have an audit trail that isolates the fraudulent credit card charge and credit card credit in that account.

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15 Comments
Level 9

How do you handle accounting for bank fraud?

I would create an expense account and name it "Fraud Expense" and I would post both the credit card charge and the credit card credit to this account, this will net to zero. Then you will have an audit trail that isolates the fraudulent credit card charge and credit card credit in that account.

View solution in original post

Level 1

How do you handle accounting for bank fraud?

I was leaning that way.  How would you categorize such an expense account?  Other Expenses -> Other Miscellaneous Expense 

Level 9

How do you handle accounting for bank fraud?

I have always put it under Expenses/Bank Charges. It's an in-and-out by the bank and not really a business expense, and it nets to zero.

Level 1

How do you handle accounting for bank fraud?

Okay, thanks for the help.  I will consider that.   This one wasn’t so in and out.  We had to fight it then apeal because the seller was disputing but it was clearly not us that made the charge.  

 

Anyway it took a ok a few months.  But I can see still using the bank charges type

Level 1

How do you handle accounting for bank fraud?

How about if it is a fraud concerning our debit card?  We had 2 charges on debit from our checking. The bank refunded them, in ONE deposit. How do I enter it in deposits?  Thanks 

Level 1

How do you handle accounting for bank fraud?

 
Level 1

How do you handle accounting for bank fraud?

Hey Everyone, I created an Other Current Assets account to record fraudulent payment from our company's checking account used to pay an unknown person's credit card via chase epay. This happened in 2019, and funds have not been reimbursed to our company yet so I wanted to keep it on the books until funds are returned to us.

Level 1

How do you handle accounting for bank fraud?

In my case the fraud was using my debit card. The bank did not want to refund the money. How do I post the stolen money in QB. I guess I should create an account for that fraud expense, but I don't have a credit from the bank. 

QuickBooks Team

How do you handle accounting for bank fraud?

Good evening, @Osimon72.

 

I'd be glad to provide information with recording this in QuickBooks.

 

To ensure that your books are accurate, I'd first reach out to your accountant to make sure the specifics are correct.

 

You can also refer back to the information provided by my colleague @Regina_Lend_A_Hand_Accounting with creating an account as well.

 

If you have any more questions or concerns, please don't hesitate to comment below. Have a good rest of your day!

Level 9

How do you handle accounting for bank fraud?

@Kendra H Thanks for the call-out Kendra! :)
Level 1

How do you handle accounting for bank fraud?

We were the victim of bank wire fraud. A good size amount of money was sent out of our business account.  Now after 2.5 months, our bank finally returned it to our account.

 

My question is how do we handle the amount taken out and handle the amount that came back in so it doesn't show as expense out and income in as we have it now. 

 

We are not very sed to chart of accounts, but could use some category

 

Thanks.

Level 1

How do you handle accounting for bank fraud?

Creating an Expense account makes sense.

Would you "Write a Check" for the fraud amount or would you enter a bill and then enter a credit?
What vendor would you associate it with, The Bank?

 

QuickBooks Team

How do you handle accounting for bank fraud?

Thanks for joining this thread, pcarew.

 

Fraud transaction is part of your expense. That being said, you can create an expense transaction. Simply go to the + New button and select Expense.

 

In addition, we can save the expense transaction even without a vendor. All we have to make sure is that we've selected the correct expense account for fraud and the affected bank.

 

You'll want to check this link for your reference on how to prevent credit card fraud.

 

Click on Reply and leave a comment if you have more questions. Have a great day!

Level 1

How do you handle accounting for bank fraud?

Thank you for replying, but where is the "+New" button?

I'm on QB Pro 2015 Desktop version.

QuickBooks Team

How do you handle accounting for bank fraud?

Hello, pcarew. 

 

Thank you for reaching back to the Community. The +New button is only available for QuickBooks Online version.  

 

Though, you can create a bill and credit it to a designated vendor. However, we need to ensure that we've chosen the accurate expense account for fraud and the affected bank. 

 

To make sure that your books are accurate, I'd suggest reaching out to your accountant to ensure that everything is correct.

 

Check this article for future reference: Prevent credit card fraud

 

If you have any more questions or concerns, please don't hesitate to click the Reply button. Have a great day, and stay safe!

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