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Talking Shop
Opportunity that an exception report is produced of any changes to standing
3 - Consider remote locations. There is often a link between fraud data on the supplier master file.
and the distance from head office. For example, within a London
based organisation a small, seemingly profitable, regional business 9 - Monitor the car park. Although it is stupid to flaunt your ill
will often get less management attention and therefore the gotten gains at work, most fraudsters do. Pay close attention to the
opportunity to commit fraud increases. cars parked in the management car park and consider whether the
salary you pay certain managers warrants the vehicles they drive.
4 - Conduct zero based budgeting. Organisations should pick an
area of their business, for example marketing, and embark on a 10 - Perform background checks on recruitment. Don’t give those
“zero based budgeting” exercise rather than relying wholly on trend with a flawed history the chance to commit fraud in your company.
against prior year. Over 50 per cent of people lie on their CV, so pre-employment
screening to detect such falsehoods can prevent the employment of
5 - Pay attention to areas where there is no physical product. those lacking integrity.
Any area of the business that has no physical product, for example
consultancy services, factory cyclical maintenance or advertising, 11 - Pay attention to morale. Fraudsters are often dissatisfied with
are often more susceptible to procurement fraud. their work and rationalise their entitlement to further reward.
6 - Assess IT vulnerability. Fraudsters use widely available tools, 12 - Investigate high staff turnover. It is very hard to be a
such as keystroke loggers, to obtain sensitive data like PINs and whistleblower at work. It is much easier to polish your CV and look
passwords. Appropriate administrative controls and passwords, for another job. Management should pay particular attention to
prevention of unauthorised software installation, restrictions on USB those areas of the business that have high staff turnover. It is good
ports and other measures can reduce the fraud risks. policy to have in place a system of exit interviews for staff, enabling
them to tell you about concerns that they may not have raised prior
Indicator to deciding to leave the organisation.
7 - Don’t neglect over-performance. If something is too good to be
true, it usually is. When you are assessing the performance of a Fraud will never completely go away. However, that doesn’t mean
business or an individual within it, make sure you pay adequate that you cannot combat it. Keeping a watchful eye, ensuring that
attention to over-performance. your staff know that fraud will be investigated and reported will go
some way to protecting your business.
8 - Review changes to the supplier master file. This is part of a
computerised accounts payable system where data is held on
suppliers, including their bank account details. It is very important
Simon Bevan is national head of BDO’s Fraud Services team
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