What to Do if You Suspect Fraud in Your Company

By admin / January 24, 2019

Despite making efforts to prevent fraud, the sad reality is that it still occurs on a regular basis. In fact, it is estimated that companies will lose around 5% of their revenue every year due to fraudulent activity. Fraud can happen in any business, whether it’s small or large, a new start-up, or a company that’s well-established and has been around for years. Suspecting fraud within your company can bring up all kinds of emotions for a business owner, but it’s important to make sure that you take the right steps to deal with it. Here are some immediate action steps that you should take.

#1. Keep Potential Evidence Safe:

If you have found a file or other document that could be evidence of fraud, it’s important to safeguard it straight away. Even if it doesn’t turn out to be evidence of fraud, anything that you suspect could point to or prove fraudulent activity by an employee should be kept safe. However, don’t be tempted to examine the evidence on your own; electronic files, in particular, can be very fragile and easily altered. In fact, simply turning a computer off can damage potential evidence. So, secure all computers, cell phones, and other company electronics straight away.

#2. Call the Professionals:

The next step is to have any evidence that you have discovered examined, in addition to a search for any other evidence that could be stored or has once been stored on company devices. Computer forensics techniques can be used to discover any file alterations, deleted files, or files that have been copied by an employee to an external drive. In addition, computer forensics professionals at Secure Forensics can discover if any employees have been visiting unauthorized sites, even if they have taken steps to cover this up by deleting their cache and browser history.

#3. Deal with the Suspect:

If at this point you suspect an employee or several employees to be involved with fraud, it’s important to deal with them quickly. However tempting it may be, it’s a wise idea to refrain from firing them immediately since this could actually hinder you when it comes to the gathering of evidence. And, if evidence is not directly pointing to them at this moment, you could land your company in hot water if you fire the employee, only for them to be later found not guilty at a trial. Instead, restrict their access to company data and don’t allow them to take their computer or any other items from the office.

#4. Notify Your Insurance Provider:

Your insurance company will usually cover your losses quickly, provided that you follow their guidelines when reporting the fraud. In most cases, it is crucial for employers to report fraud to their insurance provider within 30-60 days, depending on your policy specifics. Failure to document any losses within the given timeframe could result in a loss of coverage.

Suspecting fraud within your company can be a very stressful situation to deal with. Follow these action steps to ensure that no further damage is done.

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