What to look for and what to do about employee fraud.
Most business owners believe that they treat their team well and that no employee would dream of acting out against the company. Unfortunately, fraudulent activity can go on right underneath your nose and you don’t realize it until it is too late. From check tampering to petty theft, employee fraud can happen to any business – including your small company.
While small businesses may not have the power to hire a full-fledged fraud detection unit, there are certain procedures to help curb employee fraud.
If you don’t know your employees, then you won’t know what to look out for. Spend some time getting to know your team and be on the lookout for any changes in behavior. For example, you may notice his or her financial situation has changed or that there is a significant devotion or lack of devotion to work. There may be a reason for concern if you spot unusual activity.
Set an Example
Business owners must create a workplace culture of honesty and values by setting a good example. If employees hear you lie to clients and spend business money recklessly, they won’t feel too inclined to protect your business at all costs. A business owner who splurges on company lunches three times a week is creating a culture where this behavior is perceived to be normal. Set a good example for your employees.
Review Your Company Spending and Finances Regularly
One of the most common places to show questionable spending occurs in company purchases and credit card usage, so this should be reviewed regularly. Summary reports can also hide a lot of things, such as shrinkage, discounts, and marketing expenses, which may not fall in line with operational expectations. They are not always fraud, but can be identified as things that are excessive or unnecessary. It is easier to correct this problem before it becomes habit for your employees.
Allow Safe Reporting
There needs to be a careful way for employees to report theft or fraud by coworkers. This should be done carefully to avoid signaling that you don’t trust the team.
Safeguard Your Company
Ensure that your business is protected from the inside out. Secure the right insurance coverages and feel assured that your business is safe.