Preventing fraud during the holidays

By Lindsay Gill, CFE

As we discussed in last week’s blog post, there can be more fraud during the holiday season for a variety of reasons. A few quick steps you can take to reduce your vulnerability to fraud include:

  • Be present – The perception of detection is often one of the strongest controls against fraud.  Business owners need to be aware of what is going on in the work environment and let employees know that they’re watching.
  • Focus on red flags – Pay attention to employees who seem to be spending a lot of money this holiday season or who are always coming in early or staying late by themselves. Realize that these employees may be under a lot of pressure at this time of year, which could be leading them to commit fraud.
  • Have strong controls in place – Make sure that various duties are segregated so that different people are handling different tasks, rather than one person doing everything. If duties can’t be segregated, have compensating controls in place.
  • Review everything – Never leave an employee to check and approve their own work.   Be sure to review company credit card statements for personal expenditures.  Require timely requests and original  receipts for employee reimbursements. Pay close attention to bank statements and canceled checks.  The disbursement cycle is the most vulnerable to fraud.
  • Don’t get relaxed – During the holidays, people may want to be more laid back and relaxed, but this can make it easier for fraud to be committed. Review your anti-fraud programs and controls and tighten up where necessary.  Most of all make sure your employees know and understand your stance on occupational fraud.



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