Fraud Prevention Strategies for Entrepreneurs and Small Businesses

Fraud occurs in companies of every size. But small businesses, especially new ones, have special risks because they generally can’t invest in expensive fraud-prevention programs. Thankfully, there are simple yet effective strategies that can reduce the likelihood of fraud, however small or new your company is. Understand the risk Fraud schemes can involve employees (occupational fraud) or third parties (including vendors, customers and cybercriminals). And sometimes, workers and outsiders collude to commit fraud. Fraud perpetrated by third parties includes identity theft, credit card scams, bank fraud and cyber-related schemes, including ransomware attacks. Occupational fraud usually falls into one of three major categories: asset misappropriation, corruption (such as bribery) or financial statement fraud. Although these potential fraud threats may feel overwhelming, know that they all have the same objective:...

Balancing the Rights of Employers and Employees When Fraud is Suspected

Most fraud-prevention guidance advises owners and manager to monitor employees. But what exactly does this mean? Are you legally entitled to monitor employee computer use? What about security cameras in the workspace? Can you search an employee’s desk if you suspect the person is hiding something? The simple answer is that to stay on the right side of the law when fraud is suspected, your business must be careful about invading employee privacy. Their rights Many employment laws apply to employees’ privacy rights. In general, they attempt to balance employers’ interests in minimizing losses and injuries and maximizing production with employees’ interests in being free from intrusion into their private affairs. By adopting and clearly communicating employment policies, your company can, within limits, establish its authority to conduct...