In the following blog, we discuss:
Small business or not, employee fraud can happen anywhere and anytime. It’s important to first understand why people turn to committing fraud. From the blog, The Fraud Triangle, Donald Cressey, a criminologist, found that there are three factors that go into pushing someone to commit fraud. The three main components of the fraud triangle are perceived pressure, opportunity, and rationalization. If all three of these factors are present, there is a very high probability and risk that fraud will occur. Head over to the blog The Fraud Triangle for a refresher and explanation of the three key components of a fraudster's mindset and actions. In this blog lies the answer to which of the three we can eliminate within the business or make it more difficult for fraudsters to attack.
Take Away the Risks of Fraud
Sometimes life can get in the way and it’s inevitable that those emotions can follow one to work. At times like these, business owners really cannot do much besides establishing a mentorship program, counseling, etc. Conducting quarterly surveys can help reassess the health of employees, increase motivation to work efficiently, and hit those objective key results effectively (OKRs). Check out this OKR blog for more information.
Hiring new employees can be difficult, but hiring trustworthy employees is imperative. In a big company, it’s hard to make every employee feel noticed and understand who they really are. Handing out gift cards, treating employees to lunch, or other events are little things that can make all the difference. Anything that can help employees feel appreciated and not just any other ordinary employee. But it’s hard to keep employees in check with just these, so organizing a reporting system (submitted by anonymous employees) or a policy to maintain a code of conduct, can make employees be more aware which leads to possibly steering them away from even thinking about the act.
Though business owners cannot lessen the pressures that happen at home or within people’s minds, by adding extra barriers to confidential information the business can stay in the clear unless it becomes compromised. With everything being online and digital now, paper shredders aren’t even relevant anymore. Business owners know that security is a priority. So, it’s even more important than ever to stay on guard with online information. Without implementing internal controls, we are giving people the opportunity to access confidential information or assets. Can include intensifying credit card protection, cybersecurity, data/documentation protection, and the list go on. Therefore, by taking away opportunity, which is one of the easiest pieces to the Fraud Triangle, one of the crucial pieces of the Fraud Triangle, we are protecting not only the business but ourselves as well.