One of the challenges fleet managers must face is detecting driver fraud and then developing ways to reduce these types of incidents.
Although many employees do not embrace this temptation, there are some who end up lying or even stealing as it is a way to make an extra buck. Below, we will define some of the common types of fraud in fleet and ways to deal with them.
Among the most common wrongdoings taking place in Latin America are drivers using vehicles for personal use, taking routes not recommended by the company, providing transport services on their own time, misreporting fuel expenses, or even falsifying repair and maintenance services.
As for the first two, this could be detected by excessive delays in deliveries. While the common excuse of traffic may be the real culprit in most cases, there may be times when your drivers take alternative routes and this could be for several reasons.
Maybe they needed to run an errand, they wanted to visit a friend or relative, or just felt that taking another road would be more pleasant. Although these are not very severe infractions, they do cost the company money, more so if they occur on an ongoing basis.
Another thing that could occur is drivers using their company vehicle to make extra money by providing cargo or passenger transport services on their own time, depending on the type of vehicle they have been issued.
Finally, we cannot go without mentioning those who are just not honest. While misreporting fuel expenses is the most common infraction, some drivers do end up falsifying repair or maintenance services and even vehicle theft reports in some cases.
With this said, how does a fleet manager reduce the number of these incidents happening?
First of all, you must provide a work environment that is pleasant for drivers, one that stresses teamwork and transparency all while treating employees with respect and dignity. With this, most drivers will be less likely to behave in the wrong manner but that does not mean that infractions will not occur.
In Latin America, some fleets (mostly local) tend to be a bit more carefree and do not have well defined policies. To better control matters, fleet managers need to have a detailed vehicle policy which stipulates exactly what the vehicle can or cannot be used for and this includes rules related to fuel matters.
Having a fuel card with real-time fuel pricing, electronic authorizations and multi-currency charging, as well as fraud protection would be ideal.
One thing that is very important for fleet owners is cross-data gathering, according to Gustavo Ladeira who is Chief Business Development Officer in Latin America for Israel-based vehicle fleet and asset management company Pointer Telocation.
“To make the lives of fleet managers easier, information must be crossed (e.g. Telemetry software with Fuel Supply software) so that they can draw the right conclusions.” Mr. Ladeira told Fleet LatAm, the Latin America arm of Global Fleet.
Among the companies providing fuel cards in Latin America are US-based Transcard which is now serving Mexico and France’s Edenred which has integrated with Pointer Telocation as well as Brazil-based Ticket Log in the region.
Another thing to keep in mind is that automated fuel dispensers may be convenient, but they increase incidents of fraud. Drivers could also purchase fuel quantities above fuel tank capacities without you knowing it and those with fuel cards could complicate efficient fleet monitoring by exchanging cards between themselves.
Moreover, when it comes to repairs and maintenance, the company should carry out the work and not the driver if you want to reduce the incidents of fraud.
Make sure that you don’t overlook the value of technologies such as telematics and fleet tracking devices so that you are really aware of what is going on. You must have instant access to vital data when needed.
Finally, all of this goes hand in hand with training your drivers to drive appropriately. This will help reduce the need for repairs and cut down on accidents, all of which will bring down expenses and make your boss happy in the end.
10 Tips to combating fraud
- First of all, maintain a good work environment with happy workers
- Have vehicle trip logs at hand
- Accurately define business and personal travel
- Recognize driver behavior which may indicate fraud
- Have maintenance alerts and warning indicators in vehicles
- Have an organize maintenance schedule
- Manage routes and driver speed appropriately
- Know your fuel consumption per trip
- Have a fuel mileage tracker
- Finally, make use of telematics and fleet tracking technologies
FLEET MANAGEMENT AUDIT
Fleet management is the use of a set of vehicles in order to provide services to a third-party, or to perform a task for our organization, in the most efficient and productive manner with a determined level of service and cost.
Fleet management activities are shown in the following graph 1:
Graph 1: fleet management activities
The proposal audit analyses and assesses all fleet management activities shown in the graph 1, and its main goals are:
- Know the overall status of the fleet management activities
- Provide the analysis, the assessment, the advice, the suggestions and the actions to take in order to cut costs and increase the efficiency and efficacy of the fleet management activities
With the information obtained, we’ll elaborate a report that holds the overall status of the fleet management as well as the suggestions, recommendations and the measures to take in order to cut costs and optimize the fleet management activities.
CLICK ON THE FOLLOWING LINK TO DOWNLOAD THE PROPOSED FLEET MANAGEMENT AUDIT: