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5 Crucial Internal Controls to Prevent Employee Theft and Fraud

 

5-Crucial-Internal-Controls-to-Prevent-Employee-Theft-and-Fraud

 

Commercial crime insurance is a great safety net to help any size business protect themselves from employee theft and fraud. But being vigilant isn’t enough in 2019 to keep yourself safe forever.

Not one business is immune to it, which is why preparation should come first. But managing business can be hectic, making looking for any warning signs less than simple. Looking for the signs of theft and fraud doesn’t always have to be an impossible feat, if you know where to look and what you look for.

Every business should have certain internal controls in place. These controls will help to establish a culture within your business that does not tolerate crime, and will allow you to more quickly detect crime and handle it before it becomes a major issue. If you’re not sure what those might entail, here’s what you’ll need to know.

Essential Anti-Crime Measures

While there’s many types of fraud that can be committed, there isn't just one single way to combat them. That’s why Kositzka Wicks and Company came up with some smart controls you can utilize from the inside in order to keep your business safe and your commercial crime insurance a backup plan:

  1. Enforce mandatory vacations, always. Make employees take time off even when they don’t want to. It’s better than them getting burned out later and costing the company money long-term.
  2. Monitor all payroll checks to make sure they make it to the right worker. There’s more than one way to do it, such as having paychecks personally signed and watching them come and go from your own Human Resources (HR) department. Also putting “for deposit only” on checks can help prevent them from being cashed by anyone but the employee themselves. Those that handle revenue should not handle distribution.
  3. Secure all offices before leaving the premises. It’s not about just securing the checks and where they go. It’s about keeping the offices safe as well. If we’re not properly locking up consistently, expect internal issues to happen. Distrustful workers will catch on and take advantage of situations that they shouldn’t.
  4. Rotate the duties of all who handle money on site. Working in teams when it comes to money can be problematic. Try to avoid it when possible. When everyone rotates duties, it makes it harder from internal crime to take place.
  5. Establish a Whistleblower Program for Disgruntled Employees. Sometimes workers might not feel safe coming forward on a topic because they fear the blowback that could hit them for it. Having a third-party involved might make everyone involved feel that much more comfortable in the long run.

About Axis Insurance

At Axis Insurance Services, we aim to help our customers identify their exposures and protect themselves. Founded in 1999, we offer insurance programs to a wide variety of professionals and industries including attorneys, real estate, healthcare, architects, and more, and also have a wholesale division. We pride ourselves on offering flexible insurance coverage tailored specifically to each customer’s needs. To learn more about our solutions, contact us at (201) 847-9175 to speak with one of our professionals.

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