To highlight fraud week, the Association of Certified Fraud Examiners (ACFE) has released a set of basic tips it said every organisation should be aware of.
The campaign encourages organisations of all sizes and industries to host fraud awareness training for employees and to conduct employee surveys to assess levels of fraud preparedness.
Organisations lose an estimated 5% of their annual revenues to fraud, according to the ACFE.
1. Be proactive.
Establish and maintain internal controls specifically designed to prevent and detect fraud. Adopt a code of ethics for management and employees. Set a tone at the top that the company will not tolerate any unethical behaviour.
2. Establish hiring procedures.
Every company, regardless of size, can benefit from formal employment guidelines. When hiring staff, conduct thorough background investigations. After hiring, incorporate evaluation of the employee's compliance with company ethics and anti-fraud programs into regular performance reviews.
3. Train employees in fraud prevention.
Once carefully-screened employees are on the job, they should be trained in fraud prevention. Are employees aware of procedures for reporting suspicious activity by customers or co-workers? Do workers know the warning signs of fraud?
4. Conduct regular audits.
High risk areas, such as financial or inventory departments, are obvious targets for routine audits. A good starting point in identifying fraud risks and establishing a strategy to prevent such losses is ACFE's Fraud Prevention Check-up (PDF).
5. Call in an expert.
For most firms, fraud examination is not a core business component. That's why, when fraud is suspected or discovered, it is imperative to enlist the anti-fraud expertise of a Certified Fraud Examiner (CFE).
