Five ways to protect your business from fraud
Here we suggest five ways to protect your business from fraud. The risk posed to your company's financial and reputational health as a result of fraud, bribery, and corruption can be significant. Companies can be haemorrhaging money and not know where from or why. And often, eliminating this is more cost-effective than attempting to increase sales.
Ensuring you don't have any leaks is a critical aspect of any business; SME or Global. Being proactive in finding them is more effective than launching a reactive investigation after the damage has been done.
So here are five tips for preventing fraud in your business:
1. Prevention is better than cure
Spending a little time and money now could save you endless amounts of time and money in the future. Remember, the biggest threat to your business isn't always a financial one. The reputational damage caused by fraud, especially if it's shown that you did not attempt to minimise the risk, could finish the business.
2. Look for weaknesses
There are lots of red flags that may indicate that all is not well. You are particularly vulnerable when cash payments are involved. Try and reduce these to an absolute minimum wherever possible. Internal fraud is likely to be small in value, but over time they will represent a significant loss. Always ask for evidence of expenses and periodically check a random sample in detail to make sure all is well.
3. Strengthen your culture
An anti-fraud culture needs senior management buy-in and needs to be led from the top. It will take time to develop if it is to be successful. Add fraud as repeat agenda item at your monthly management meeting. This emphasis on fraud will focus your thinking about your organisation's constant threat. Consider training your staff to look out for fraud indicators.
Also, if you haven't got something in place already, you should consider introducing a:
- A fraud policy
- whistle-blowing policy
- A fraud response plan
4. Keep monitoring
Tackling fraud is an ongoing challenge. Fraudsters operate in the same way as a virus. By continually mutating once a solution has been found to stop them. Fraud monitoring should not be reviewed once a year on a tick sheet; it needs constant review. A continuous process is needed for you to become more fraud resilient.
5. Don't bury your head in the sand
Fraud exists in all organisations no matter how large or small. It isn't good enough to deny you have a fraud problem. The fact is that you just haven't found it yet. Don't wait for it to hit you hard. Think what preventative measures to introduce or get help, sooner rather than later.
We suggested five ways to protect your business from fraud. You face a significant risk posed to your company's financial and reputational health due to fraud, bribery, and corruption. There is every chance companies can be haemorrhaging money and not know where from or why. Often removing fraud improves your bottom line.
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