Preventing And Detecting Employee Fraud

Article 4 of 4: Employee Fraud Series

Whether or not a company has experienced an employee fraud, it is important that management and those charged with governance consider the risk of fraud for the organization and the appropriate measures to put in place to mitigate those risks. These measures will address both prevention and the timely detection of fraud to minimize any losses.

Companies that have endured employee fraud and experienced all of the steps outlined in our previous articles, will have a greater appreciation for the importance of an internal assessment. In those cases, management should consider how the fraud was perpetrated, the lapses in control that likely allowed it to happen, any red flags that would have allowed the fraud to be detected sooner, any other gaps in the control framework or culture of the organization that need to be addressed, and the steps required to reduce the risk of a similar situation happening again.