The Festive Fraud Hangover: Identifying Year-End Irregularities in Your January Reconciliations

The holiday rush may be over, but for many businesses, the financial fallout is just being discovered. January is traditionally the month when “festive fraud”—the scams that slipped through during the November and December chaos—finally surfaces during year-end bank reconciliations and VAT preparations.

At Meyer Rens Accountants, we are currently assisting clients in auditing their holiday transactions. Here is how to spot the irregularities that may have crept into your books and how to secure your business for 2026.

The "January Discovery": Common Irregularities

While you were focused on closing out 2025, fraudsters were likely targeting your accounts payable. Look out for these three red flags in your recent statements:

  • Payment Discrepancies (The “Silent” Invoice Swap): You may find that a supplier is still claiming non-payment for an invoice you are certain you settled in December. This is a classic sign of Invoice Interception, where a scammer altered the banking details on a legitimate bill.
  • Duplicate or “Ghost” Subscriptions: Review your small-batch payments. Fraudsters often send low-value “renewal” invoices for antivirus or business directories, betting that the small amount wouldn’t be questioned during the year-end rush.
  • Unfamiliar “Urgent” Settlements: Look for payments made in late December that bypassed your standard Purchase Order (PO) process due to perceived “holiday urgency.”
Woman sitting on a chair using a laptop by the window, engaged in remote work.

How to Audit Your Year-End Payments

Before you finalize your first-quarter filings, we recommend the following “Clean Slate” audit:

  1. Reconcile Supplier Statements: Don’t just check your bank balance; ask your top 10 suppliers for a statement of account. Ensure your records of “Paid” match their records of “Received.”
  2. Verify New Beneficiaries: Review any new banking beneficiaries added to your business profile in November or December. If you don’t recognize the entity or if a regular supplier’s account details changed, verify it immediately with a phone call.

Audit Email Logs: If you find a fraudulent payment, check your email security logs. Fraudulent invoices usually enter via “man-in-the-middle” attacks where your email was compromised weeks before the payment was made.

Setting a Secure Standard for 2026

Don’t let the vulnerabilities of last year follow you into this one. Use this month to strengthen your internal controls:

  • Adopt a “Call-Back” Policy: Moving forward, any change in supplier banking details must be confirmed via a phone call to a trusted number—no exceptions.
  • Tighten User Permissions: If staff left or roles changed over the holidays, update your banking and accounting software permissions immediately.

Implement Dual-Approval: Ensure that the person loading a payment is never the same person authorizing it.

Let Us Help You Reconcile

Identifying a fraudulent transaction early can be the difference between recovering the funds and a total loss. If you’ve spotted an irregularity during your January reconciliation or are worried about your year-end figures, Meyer Rens Accountants is here to help.

We can assist with forensic reviews of your accounts payable and help you implement robust financial controls for the year ahead.

Let’s make 2026 your most secure financial year yet.

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