Fraud in a workplace setting is manipulative and unethical. It negatively impacts the reputation of a business and can result in financial losses and legal action. It is imperative that business owners and their employees are aware of the elements of fraud and how to detect them. They need to make preventing & discouraging fraud top priorities. So where do you start?
Policies, Prevention & Resources
While employee fraud is a problem in any workplace, it is not the only problem, and you need to be sure you maintain a level of trust with employees that inspires their confidence in your leadership. On top of that, the biggest risks of fraud come from outside the business, and often the employees involved are being exploited for access without realizing it. Your people need to be educated about suspicious communications and activities so they can help you defend your business from both outside threats and the occasional bad egg who gets hired in.
- Institute internal controls and oversight employees can buy into
- Invest in robust insurance coverage against the occasional security breach
- Look for resources from your insurer and other industry specialists to learn about updated best practices for fraud prevention
The key to protecting your business as a director or officer is understanding where the gaps in security systems need to be plugged with human knowledge. It helps if you have an insurer who knows the industry well enough to not only provide cost effective and specific coverage, but also well enough to provide advice about other avenues of preventing & discouraging fraud that could reduce claims.