To support ‘International Fraud Awareness Week’ the Midlands-based investigators Expert Investigations have put together ‘top ten tips’ on what measures a workplace can put in place, to prevent fraudulent behaviour taking place.
KMPG analysis showed that insider fraud is hitting corporates hard. Fraud perpetrated by either management or employees accounted for 80 % of the financial loss through fraud experienced by UK businesses in 2012. The number of cases involving employee fraud rose to 35 in 2012, up from 22 the year before. Their value has also seen a sharp climb, more than doubling from £12.0 million in 2011 to £25.1 million over the past 12 months. These figures should not be ignored by any organisation.
1. Background checks – Implement a vetting procedure for new staff and agency staff, especially those in “risky” roles, such as those in finance and procurement as well of those who have access to personal details such as customer service in financial institutions, etc.
2. Look for red flags (Warning signs) – Are they the first and last one in the office? Do they rarely take annual leave? are they protective over their workload? do they seem to be living beyond their means (expensive car, own many properties, five star holidays?) If so this could be a sign of fraudulent activity.
3. Don’t discard anonymous tip offs – Most fraudsare discovered through tip offs with over 50 % of these being reported by employees and customers. Make sure you listen to these!
4. Provide an anonymous outlet for reporting – Ensure you have a whistleblowing hotline for staff and employees, and ensure it is widely advertised and used internally and externally.
5. Devise an anti – fraud corporate attitude – Ensure there are Fraud, Bribery & Corruption policies in place, frequently advertise these, ensure they are reviewed yearly, and promoted from the top down within the organisation.
6. Develop a fraud action plan – If a fraud is discovered an action plan will ensure there is a strategic and structured response to the fraud. The plan should include who will be involved at what stage of the investigation, identify key stakeholders, any reporting requirements needed under any regulation of the company, also ensure there is a HR policy in place, etc
7. Provide fraud training – Regular training and updates should be made compulsory throughout the organisation to ensure the company stance against fraud is advertised, ensure staff are aware of different fraud types, behaviours and red flags, whistleblowing and the reporting procedures are clear plus ensure they are aware of any legal or regulatory updates.
8. Change around your audit staff – Change your auditors regularly to ensure any frauds are more likely to be identified.
9. Rotate staff in key roles- Rotate people within “risky roles” so that they are not able to commit frauds for long periods of time without detection by others.
10. Always be aware – ALL staff have the potential to commit frauds! From those in lower paid roles all the way up to the senior management team. Often those in senior roles can get away with frauds for a longer period of time as they have more responsibility, less accountability to disclose their work situation and less supervision.
For more information:
To find out more about Expert Investigations email: [email protected] or call 02476 630498. Pictured: MD David Kearns.
