5 Strategies for Fraud Prevention in Your Business

Workforce fraud is a considerable issue faced by businesses of all types, sizes, locations, and industries. While we would all like to have confidence in the thought that our employees are dependable at work for the betterment of the business (and most of them undoubtedly are), there are still several reasons why your employees may commit fraudulent activities. There’re numerous ways in which they might go about it. Anticipation, detection, and prevention by using a secure payment method like ACH payment processing is essential in reducing the chances of fraud occurring. Every single business should have a strategy in place to prevent fraud, as is much easier than recuperating your losses after a fraud has been perpetrated.

  1. Recognize Your Employees

Fraud offenders often exhibit behavioral characteristics that can indicate their intent to commit fraud. Noticing and paying attention to employees can help you identify the potential fraudulent risk. It is imperative that management is concerned with their workforce and take the time necessary to get to know them. Regularly, A change in an employee’s attitude can clue you into a possible risk. This may also expose inner concerns that need to be addressed. Most often and quite, unfortunately, it’s the employee you least assume that perpetrates the crime. It is important to know your employees and regularly engage with them in a discussion.

  1. Employ Internal Controls

Internal controls are the strategies and programs applied to protect your businesses resources, safeguard the integrity of its accounting archives, and discourage and distinguish fraud and theft. Exclusion of responsibilities is a significant factor of internal control which can decrease the threats of fraud from happening.

  1. Familiarize with ACH Payment Processing

Automated Clearing House (ACH) is a payment process that electronically transfers money from one bank account directly to another. ACH payment processing the exclusive payment solution when it comes to aspects concerning security. On the other hand, compared to paper checks, ACH transactions do not go through the mail, reducing the likelihood of a check being lost in the post, come across rain damage, unintentionally dropping into the wrong hands or other possible damages which cannot be regulated internally. When utilizing ACH processing, all transactions will be executed electronically, which means they are far less likely to be manipulated or damaged, which enhances payment speed and safety for both parties.

From a business’s standpoint, ACH payment processing is additionally more beneficial as it is less open to disagreements when related to credit card transactions. Payments made using credit cards may be subjugated to chargeback dispute for various potential reasons, for instance, unsanctioned transactions, deceptive product descriptions, and clerical mistakes or direct fraud. Using ACH processing, there are only three possible situations where a disagreement may transpire: the transferred quantity was not the approved amount, the transfer took place sooner than the permitted date, or if the whole process was never sanctioned, to begin with.

  1. Employ Experts

Certified Fraud Examiners (CFE), Certified Public Accountants (CPA) and CPAs who are Certified in Financial Forensics (CFF) may assist you in starting anti-fraud procedures and measures. These specialists can deliver an extensive variety of services ranging from comprehensive internal control audits and forensic investigation to general and rudimentary consultations.

  1. Be Aware of the Corporate Culture

A constructive work atmosphere can avert workforce fraud and theft. There should be a distinct administrative structure, written guidelines, and procedures for fair workplace practices. An open-door policy can also be used as a great fraud deterrence system as it gives employees open lines of communication with upper management. Business owners and senior management should direct their actions and lead by example so that every employee responsible for their actions, irrespective of position.

Final Words

Those who are ready to perpetrate fraud do not differentiate or discriminate. It can transpire in large or small businesses alike across several industries and geographic locations. Work-related fraud can result in a massive financial loss, legal fees and damaged reputations that can eventually lead to the collapse of an organization. By utilizing secure payment solutions like ACH payment processing and taking the proper precautions, can drastically diminish fraudulent behaviors from occurring or cut losses if a fraud has already happened.