The Brain Storm

March 9, 2010

Be a Security Hero!

Fraud happens! No organization, whether it is a corporation, small business or even a non-profit, is safe from fraud. The fact is fraud is a real threat to the financial health and integrity of your company.

In this article we share more about the warning signs, effective ways to reduce fraud losses and how our new VOIDX product line can help make a difference.

Be a champion against fraud in your company. Read on!

A Little Fraud Goes a Long Way
Once fraud starts, it doesn't stop on its own. It starts small, but will continue to grow until the perpetrator is caught. Very few thefts may occur at the beginning and are generally for small amounts. As the fraudster realizes how easy it is to take $100, next week the amount will grow to $200, then $500 and then easily into the thousands.

Here are a few fraud facts published by the Association of Certified Fraud Examiners:
• The average fraud scheme lasts 18 months before it is discovered.
• Cash was targeted in more than 90% of fraud schemes.
• A usual scheme costs small business an average of $127,000 in losses versus $97,000 in losses a large company.
• In more than 37% of the fraud cases discovered, the fraudster had been employed by the organization for more than 10 years.

Below are common methods of company fraud to be aware of:
Skimming – A typical example of this type of fraud is when a cashier pockets cash from sales that are not rung up. Discounting a sale after payment receipt and pocketing the difference, submitting falsified expense sheets and receipts and tampering with band deposits are other examples of skimming.

Fraudulent Disbursements – Losses from this type of fraud generally involve paying ghost employees, vendor fraud schemes and paying nonexistent vendors. These losses can be very difficult to detect in large companies with hundreds or even thousands of employees and a large number of vendors.

Larceny – This type of fraud occurs after cash has been received and recorded. Check tampering including forgery, counterfeiting and alteration are included. Each check that goes out for your payroll, vendor and other office expense bills puts you at risk.

How Can I be a Hero Against Fraud?
Fraud is an ever-present threat to every organization’s balance sheet and improving security measures should be a top priority.

To Prevent Skimming
• Develop a written code of ethics.
• Request all employees be on the lookout and safely report abuse.
• Implement a system of checks throughout a shift.

To Fraudulent Disbursements
• Examine any rises in soft costs including advertising, consulting and overtime.
• Investigate complaints from customers about billing and vendors about payment.
• Delegate billing and payment tasks making it harder to conceal fraud.

To Prevent Larceny

• Learn more about our proprietary anti-copy fraud deterrent solution called VOIDX at www.voidx.net.
• Call us at 312-263-1569 to find out how VOIDX checks and documents are designed to be compatible with your current systems and not increase your costs.
• Have piece of mind that your company is protected by VOIDX.