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Fraud Prevention Programmes

• Many organisations rely on internal controls to prevent and detect fraud. This is unwise
• In today's competitive environment internal controls have often been badly mauled as a result of "down-sizing, removal of management layers and employee empowerment
  Complacency, inertia and other pre-occupations are the fraudster's main allies
• If you add to this the ever-increasing reliance on technology, it is no great surprise that fraud is escalating both in frequency and magnitude - in all sectors
• The most worrying factor however is that fraud will be mainly committed by your own staff, and by those you probably trust most
• One recent survey revealed that 84% of the worst frauds were committed by employees, nearly half of whom were managers with more than 5 years service.

Key elements of a fraud prevention programme

Understand the Risks and Evaluating the Controls

• You need to appreciate the types of fraud your organisation is exposed
• The profile of a fraudster can also be determined with some accuracy
• Trends and statistics regarding detected fraud are valuable
• Research case histories in your sector - much more information than would think is available if you know where to look
• Build a picture of the major fraud risks - by facilitated workshops
• Building awareness of the most significant fraud indicators
• How to spot the danger signals
• Identifying your organisation's vulnerable areas

• Why traditional internal controls are unlikely to prevent fraud.
• Put yourself in the mind of the fraudster
• Examine typical controls in place to mitigate the risks identified

• Introduce effective anti-fraud policies
• Develop a fraud awareness training programme
• Communicate standards of expected behaviour and ethics
• Recognise the need for strong and consistent action when fraud is suspected /discovered.
• Use Security as a proactive prevention vehicle eg the use of Security Roadshows and Crime
• Prevention Surveys
• Use Electronic data and asset protection
• Clearly define the roles, responsibilities and liabilities of auditors, security and management

• Use management check-lists
• Have a clear Company policy on consequences of committing fraud
• Facilitate whistle blowing
• Use of specialists to aid detection and investigation
• Prepare and implement fraud contingency plans
• Ensure fraud investigation is always given top priority
• Use successful fraud investigation as a moral deterrent
• Manage the external coverage of proven fraud

Fraud - A £20 Billion Industry

Successful Fraud Investigation