Putting Checks & Balances In Place
A Employee fraud prevention program is important for any company, but is essential for businesses in regulated niches that deal with sensitive payment, personal, or health information. People are one of the biggest data risks to an organization, even when they aren’t willfully committing a breach.
According to an Ostermann Research study, many IT admins are concerned about risks associated with user behavior such as browsing the Internet, using social media, sharing resources, or uploading information to private cloud accounts for working outside the office. Training and strong data security policies are the best way to reduce non-fraudulent risks.
To decrease business fraud-related risks, follow these tips for employee fraud prevention.
Vet Candidates Before Hiring
Use robust reference and background checks at all levels of hiring, increasing reference checks appropriately for positions that will have more access to systems or data. Hiring procedures should include a full background check, including criminal and financial data where appropriate. Someone who has a criminal history or is in financial distress is more likely to be tempted with fraud. Speak to former employers and personal references to learn about the character of the person you’re hiring. Be sure to properly dispose of applications with confidential information through secure shredding.
Create Audit Trails and Use Them
Ensure there are virtual logs in place that track access to all systems. Logs should record the date, time, and person accessing the system, as well as any changes made or information uploaded or downloaded. Review all accounts, work, and data use on a regular basis. Auditing can decrease employee morale if you aren’t careful, as it makes people feel like they are being watched and aren’t trusted. Decrease the gloom-factor of audits in your business through transparency. Let employees know that audits are done regularly and why.
Interact with Staff
According to studies, many people conduct workplace fraud or other crimes due to feelings of under appreciation or pressure. Some people even use workplace crime to get back at a company or manager who they feel is unethical or unfair. Interact with staff at all levels to identify where low morale may be a problem and act to fix issues. You can also look for signs of fraudulent activity such as employees who never take time off, workers who balk at supervision, and unexplained missing data or records.
What practices do you have in place for employee fraud prevention?