Top 5 Tips To Avoid Fraud For Small Businesses

Featured blog by Debbie Fletcher, Independent Technology Writer

Fraud is a big problem for businesses right across America. A report for the Association of Certified Fraud Examiners found that, on average, businesses lose about five per cent of their revenue from fraud. Small businesses bear the brunt of this disproportionately too, with a 28 per cent higher average median fraud cost for organizations with fewer than 100 employees.

It’s tempting to feel pretty powerless against this threat too. Yet there are ways in which you can guard yourself against becoming a victim of fraud. Here are five things to do right away:

Code of conduct

Fraud comes in all sorts of shapes and sizes. What if someone wants to give an employee a gift in return for a favor or two? You might want your staff to act with a ‘common sense’ approach to this but actually it helps all involved if the guidelines are clearly laid out. Entrepreneur notes that Walmart employees are not allowed to accept as much as a bottle of water or cup of coffee at a meeting without paying for it. While that might sound a bit harsh, Walmart employees clearly know where they stand. Set out your own rules and boundaries in a code of conduct so that everyone knows what is and isn’t acceptable and you’ll have taken steps towards anyone unwittingly making themselves open to fraud.

Cyber security

Hackers are continually looking for ways to slip past the online defenses of business. While the digital age has made many business operations simpler, it also presents a headache when it comes to safety. SMEs are often seen as ideal targets because they don’t have the complex level of security software and encryption that Fortune 500 firms can afford to have in their arsenal. It’s important to have your own security software, clearly, but you’re only ever as safe as the people who use your systems. Make sure your staff know how to spot common phishing and malware attacks and ensure that passwords are regularly updated and aren’t easily guessed.

Robust payroll

How safe and secure is the money that leaves your business? Wherever money and/or data changes hands there’s a potential risk of fraud. QuickBooks offers checks that have an added layer of security, making it tough for people to tamper with them or produce counterfeit checks. Using these can give you peace of mind with this area.

Recruitment

As we’ve stated already, you’re relying on the people you employ to stay safe as a business. That means making sure you recruit the right characters to work for your company. Trust is a valuable commodity and you need to search out people who you’d happily trust with your business in their hands.

Training

All of the above things lead to our last point: training. Everyone in a business needs to know how to use their software and adopt the code of conduct – and they all need refresher sessions to reiterate the message and update knowledge as and when things change. A training regime – and record of activity – is a must if you’re to going to avoid failing victim to fraud.