Business fraud is everywhere. It can range from employees taking small items from the office to embezzling hundreds of thousands of dollars and crimes may be committed by anyone from the lowest-paid employee to someone in upper management. All too often, business owners are unaware of wrongdoing, sometimes refusing to acknowledge the possibilities – until it’s too late.
Don’t make the same mistakes as many other victims of fraud. Below are five practical suggestions for thwarting workplace fraud
1. Keep an eye on all aspects of your business. View your operation like an outsider and identify the areas that appear ripe for fraud. If a fraud risk exists, don’t ignore it and simply hope it will vanish.
2. Stay current with internal controls. A lack of internal control is often a factor when fraud occurs. Implement a system of checks and balances and regularly monitor activities. Note that employees may be deterred from theft if the system of internal control is well-documented. Otherwise, they may think they won’t be caught.
3. Develop anti-fraud procedures. Encourage your employees to come forth and report suspicious activities, but keep matters confidential. When it’s warranted, respond promptly and decisively. Consider implementing an anonymous fraud-tip hotline.
4. Stay the course. Even if no fraud is detected after an initial review, you must remain vigilant. Continue to adhere to the procedures you’ve established. Also, make sure that you update your system of controls on a regular basis.
5. Seek professional advice. For instance, an attorney’s services may be required if you decide to seek legal damages, while an accountant can help implement and update internal controls.
Of course, there are no guarantees, but these five proactive steps should, at the very least, minimize risks to your company.