Fuel is the number one expense for fleets, with fleets spending a lot to equip both the tractor and trailer for more efficient operations, as well as for telematics to monitor driving behavior behind the wheel. But even the best aero kits and dash cams on the market can't prevent one major variable driving costs up: fuel theft.
“Fuel fraud is so prevalent that companies in the logistics, construction, trucking industries, and more lose nearly $1 million per year to this type of fraud," said Hemant Banavar, Motive’s VP of financial products. "This equates to 19% of current fleet spend."
To combat this, Motive has launched new AI-powered fraud controls that detect and prevent fraud before it happens. These new features are exclusively available to Motive fleet card customers, and enable businesses to customize spending limits, automatically decline suspicious transactions, and receive instant alerts for location discrepancies.
By integrating telematics data from the Motive platform, the controls give fleet managers the precise data they need to automatically detect and prevent fraud, and do so quickly.
The fleet technology provider found that this AI solution saved customers over $250,000 from more than 1,200 unauthorized transactions during the 30-day trial period alone.
Read more: How to protect your fleet from fuel fraud | Fleet Maintenance
"These new controls introduce the most powerful fuel fraud detection capabilities on the market and will significantly decrease the impact fraud has on these businesses," Banavar told Fleet Maintenance. "In the short term, they’ll be able to analyze their bottom line, better tackle inefficiencies, and focus on other elements of their people and businesses. Longer-term, tools like these will make fraud a less significant issue in the physical economy overall."
Here are some of the capabilities of the new features:
- AI-powered Vehicle & Spend Location Mismatch provides an essential layer of security against fraud, with new alerts and auto decline controls if the vehicle location does not match the fuel card transaction.
- Fuel Type & Spend Mismatch and Fuel Level & Spend Mismatch alerts allow fleet managers to detect transactions and take prompt action, such as declining the translation, locking the card, or blocking the merchant when the fuel level or type do not match the vehicle.
- Category Level Spend Limits allow customers to set transaction limits by merchant type, times of day, days of week, billing cycle, and transaction locations for more precise control over their spend. For example, customers can allow one-time hotel transactions for immediate driver needs, set lower limits at home improvement or grocery stores, and higher limits for fuel and maintenance spend.
Evolution of fuel fraud
A common scenario is one of your drivers letting another trucker use his or her fleet fuel card to fill up, and receiving some cash in return. But this type of fraud, and the old-fashioned methods like fuel siphoning, aren't a fleet manager's only concerns. Modern tactics like card skimming, which involves a device illegally installed to steal the information of credit cards swiped at the pump, have also become more prevalent.
In general card skimming is a major problem, with FICO reporting that from the first half of 2022 to H1 of 2023, this type of theft for all cards rose 77% (70,000 cards to 120,000).
And in the trucking sector, Banavar explained "it’s traditionally been relatively easy to accomplish, because data on fuel card purchases and telematics data were not previously centralized. It was harder to identify when and how a fraudulent purchase was made."
Fraud mitigation tools like Motive's now make it harder on criminals.
"Mavis Tire, one of the largest independent automotive platforms in the U.S., recently experienced a fuel card being skimmed," Banavar recalled. "With Motive Card, they were able to lock the card and location immediately and prevent the card from being used fraudulently."
Banavar discussed a similar scenario in which a customer reported that the new fraud controls helped them quickly identify an instance of internal fraud.
"A driver was claiming they were refueling their work vehicle, when at the time of the transaction it was actually still at the customer’s facility," he explained. "The driver had been refueling his personal vehicle and they were able to quickly identify and correct the issue."
Money in the bank, fuel in the tank
"The Motive Card does so much more than save us time and fuel costs, it alerts us to potentially fraudulent activity and declines those transactions. We haven’t had any fraud since using the Motive Card,” said Alex Amort, VP of compliance for Cascade Environmental. “Because we’re able to manage our fleet and expenses in one dashboard, we have much closer control over our operations, can stop fraud before it happens, and can better coach our drivers on fueling policies and efficiency. With Motive, we’re able to obtain true, documented, direct savings to our bottom line."
Motive says that the integration of fleet telematics and spend transactions in one platform gives fleet managers a comprehensive view of all activity, so they can control and stop unauthorized spending and improve profit margins, savings, and operational efficiency.
"While it’s hard to predict what the incidence of fuel fraud will look like in the future, technology like this undoubtedly moves things in the right direction," Banavar concluded.
