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6 Methods to Implement in Detecting Workplace Fraud

In these economically stressful times, pressure and incentive to perpetrate fraud are more plentiful. Employers must address fraud risk more rigorously than ever before. Annual communication with the entity’s auditor can help pinpoint areas of higher risk.  Once identified, these areas can become the focus of management brainstorming sessions to develop processes to heighten awareness and to develop preventive measures.   

More immediately, however, some economical interim methods which may be implemented to address fraud risk include the following:

a) Management visibility  – be proactive in making the rounds of the various staff offices to provide opportunities for face-to-face conversations with employees, both to answer questions and to listen to their thoughts and issues involving the workplace;
b) Appoint a liaison – if your organization has staff employed outside of the normal office situation, consider appointing a member of the “outside” staff to relay any concerns or problems back to management; if the atmosphere may not be conducive to direct employee contact with management, consider appointing a liaison from among the “rank and file” to relay problems or concerns;
c) Ask outsiders – vendors, customers, and others who come in contact with your employees may be able to relay concerns overheard in conversations with employees.  Outsiders may be able to relate areas vulnerable to employee misconduct or business practices which might provide opportunity or incentive for fraud;
d) Suggestion box or confidential employee surveys – this may provide a less risky means for an employee to share suspicions of or known employee misconduct, or to provide information regarding issues they are hesitant to speak about openly.
e) Identify an open door – ensure that at least one member of management has an advertised “open door” so that employees with concerns have a comfortable avenue of approach to management without the need for more formal, written communication. 
f) Exit interviews – once an employee will no longer have to face his peers, he may be more likely to share information he may have been uncomfortable sharing previously. 

All of the above have virtually no additional cost to the employer, and will provide additional avenues for discerning problem areas or personnel.  None of them, however, will replace management vigilance and constant involvement in the day to day processes of the workplace.

Jill Collins