By Russ Warner, VP Marketing −
Business fraud accounts for a significant portion of financial loss. In the U.K., an estimated 5 percent of annual revenue will be lost in an average business due to employee fraud.
Reports indicate that as many as one third of employees will commit business fraud if the opportunity presents itself, and an additional third will commit fraud when extreme pressure or rewards are associated with fraudulent opportunities.
Recruiting Using Employee Screening
In the face of such statistics, businesses need to adopt quality employee screening as a necessary step to prevent fraud from occurring.
Andrew Durant, the senior managing director at global business advisory firm FTI, suggests multiple steps to prevent fraud. His first suggestion, which he deemed the most important step, is in recruiting the right employees from the start. This takes quality screening techniques and tools to ensure that the new worker has the desired level of integrity that would discourage him from committing fraud.
The point that many employers might neglect is that this includes not only entry-level or temporary employees but also higher-level positions such as managers and directors considering that their position of power would facilitate committing fraud.
As anyone can commit business fraud, employees should carefully screen all job applicants before hiring them.
Promoting Honesty with Current Staff
It’s worthwhile to remind current employees about appropriate behavior. Codes of conduct, clear policies and increased awareness will encourage honest behavior and will foster an environment where people who witness fraudulent activity feel they can report it.
Not all fraud can be prevented, but if business owners and managers prepare themselves ahead of time, it can be tackled head on.
Establishing ethical behavior from the top of the company down will set a precedent of honesty for everyone. Distributing a written code of conduct, complete with rules and consequences, will also motivate employees to perform ethically.
Of course, EyeDetect™ can be effectively integrated into a company’s HR policies and procedures to be used when screening job applicants or for screening employees in positions of trust.