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Step Up Anti-Fraud Efforts As Business Improves

Money ChartEveryone has goals when they first start. In the beginning, people keep track of every little item, maintain perfect records and watch their employees like they were under a microscope. In fact, that person probably could account for every paper clip. Unfortunately, as a business grows in the process of achieving their goals, the owner starts to delegate various job functions. Before you know it, there is an employee for every function of the company.

Soon the owner of the company has employed so many people to perform these functions, that the owner becomes stranger in his own business. As time goes by, the owner probably will see people in his office and couldn’t tell you if that person was an employee or client. He has become less than a regular employee since the employees probably know more about the daily operations of the business than the owner. Does this scenario sound familiar?

A company watches every penny during tough times but it probably steps back from the microscope once business starts improving again. Scam artists, fraudsters and dishonest employees know this, too.

That’s why you actually need to increase your anti-fraud efforts as the economy and you’re your business fortunes brighten.

Also, small businesses tend to outsource and add more customers and employees during prosperous times. That expands and alters billing, cash flow and payroll procedures, and provides more opportunity for fraud.

Monitor customer complaints. They’re the second-most common way of detecting fraud; employee tips the are most common way. Complaints such as “the bill is too high”; “I received a bill for something I didn’t buy”; “I didn’t receive a refund”; or, “I’m being nagged to send money for a bill I already paid”.

8 BEST WAYS TO PREVENT FRAUD

  1. Strong internal controls
  2. Employee background checks
  3. Regular fraud audits
  4. Established fraud policies
  5. Willingness to prosecute
  6. Ethics training for staff
  7. Anonymous fraud report mechanism
  8. Workplace surveillance


If you have any questions or require further info please call 718-531-1105 or send an email.


This web site and these articles are not tax or legal advice and are not intended as tax or legal advice.  They are intended to provide only general, non-specific legal information and are not intended to cover all the issues related to the topic discussed.  The specific facts that apply to your matter may make the outcome different than would be anticipated by you.  This web site and these articles are based on United States law.  You should consult with an accountant or lawyer familiar with the issues. This web site and the articles contained on this web site are not solicitations.

Contact Info:

Ronald Semaria
Semaria Consulting
1408 East 66th St
Brooklyn, NY 11234
Email: info@semaria.com

Phone Numbers:

Phone: 718-531-1105
Toll-Free: 866-531-1105
Toll-Free: 888-IRSAUDIT
Toll-Free: 888-RONTAXES
Fax: 718-444-7152

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