“The thief, as will become apparent, was a special type of thief. This thief was an artist of theft. Other thieves merely stole everything that was not nailed down, but this thief stole the nails as well.”
― Terry Pratchett
To a lot of business owners, theft seems like something that happens to other people – people on the news, or your friend’s associate’s boss.
But it couldn’t happen to you…right?
Wrong. Fraud and embezzlement are a widespread threat faced by anyone who owns and operates a business – and that’s a scary thought.
And even though it is frightening to think about the possibility of facing theft in your own organization, the only way to ensure it doesn’t happen is to proactively put fraud prevention measures in place, keeping your operations above-board, transparent, and secure.
Let’s talk about some methods.
Separation of Duties
This is one of the most impactful fraud prevention steps you can take within your business, and it’s also one of the hardest for those who run a small team of employees. When you don’t have a lot of extra personnel, it’s tempting to assign a lot of duties to one person.
But the lack of accountability in having a single person write checks, handle deposits, go back and forth to the bank, and reconcile the checkbook, presents the perfect opportunity for money to begin to go missing. Spread these tasks out between multiple team members and keep track of who’s doing what.
Invest in Experienced Eyes
It’s hard to catch mistakes or irregularities in your reports or transactions if you’re not sure what you should be looking for. Rather than combing through important financial information yourself, bring in an outside expert who can spot places in your books that don’t add up the way they should in order to boost your overall fraud prevention strategy.
Airtight Company Policies
Sneaking cash out of an envelope isn’t the only way theft happens inside a business. Another prevalent form of embezzlement is online theft – usually of employee information. (This can include identity or data theft.) Put some rules and regulations in place as part of your larger fraud prevention plan to keep track of who uses which property at what time, which sites are off limits, and how data is accessed to keep online activity secure.
An organization that keeps a close eye on its operations and financial management is an organization that is much less likely to fall victim to theft or embezzlement. Strong fraud prevention strategy means keeping your people accountable and your finances well-recorded.
If your business doesn’t yet have a good, solid strategy for preventing fraud, let’s talk.