Fighting Fraud in a Soft Economy

People react to financial stress in different ways. Some get creative. Some get criminal.

According to a recent article in the Chronicle Herald, workplace fraud is widespread in Canada and the soft economy will only make it worse. As employees feel increasing financial pressure - and possibly bitterness over missed promotions and raises - some may view workplace theft as the company's "cost of doing business."

Joyce McGeehan and Sarah Drysdale of Grant Thornton LLP offer these suggestions for curbing workplace fraud:

• Make sure employees understand management's expectation of ethical behavior
• Institute a real "open door policy"
• Start a whistleblowers hotline where individuals can report suspected fraud without fear
• Use due dilligence when researching new hires
• Immediately remove access rights to computer systems when employees are terminated
• Determine where your organization is most susceptible to fraud, and remember that customer information and other intangibles are targets as well goods and cash
• Don't assume that fraud controls are in place - conduct a walk through and test your policies and processes
• Revisit fraud controls after policy and personnel changes
• Provide written instructions to make sure that managers know what to look for
• Pay close attention to all bank account activity
• Keep a close eye on expense reports and insist on original receipts