With 75% of employees admitting to stealing from their employers at least once, fraud in the workplace is something every organization needs to take seriously.
From data theft to inflated expense claims, and even failure to record vacation or sick leave, fraud occurs in a variety of ways and can be costly to an organization’s bottom line, reputation, and morale.
We recently hosted a Fraud Prevention Month webinar with Risk and Forensic Expert Caroline Dixon where we discussed key drivers of workplace fraud and how your intranet can be used as a powerful fraud prevention tool.
What is employee fraud?
According to the Association of External Fraud Examiners (ACFE), workplace fraud is defined as the use of one’s occupation for personal enrichment through the deliberate misuse or misapplication of the organization’s resources or assets.
It typically involves asset misappropriation, theft of intellectual property, data misuse, and payroll schemes, and can occur when pressure, opportunity, and the ability to rationalize fraud come together.
Why is employee fraud on the rise?
According to a recent report, 51 percent of organizations have uncovered more employee fraud since the on-set of the pandemic. “COVID-19 has created the perfect storm for workplace fraud,” Caroline said. “The internal controls in organizations have gone down while the opportunities to commit fraud and employee pressures have gone up.” While many businesses have embraced a hybrid workplace, the new working model has posed many fraud prevention challenges, including staffing shortages, outdated processes and technology, and lack of management oversight.
8 recommendations for using your intranet to prevent employee fraud
The good news is that by taking a proactive approach and using your intranet to boost fraud awareness, build a positive workplace culture, and modernize business processes, fraud can be prevented. Read on to learn how you can use your intranet to prevent employee fraud.
- Create a fraud resource hub
Fraud awareness training is important but it's not a one-and-done thing. We recommend creating a dedicated fraud hub and regularly sharing internal resources such as policies, incident reports, and training materials, you can build a community and shared vision around fraud prevention. The ACFE also has valuable case studies, news stories, and videos you can share with employees to keep fraud top of mind.
2. Create a paper(less) trail
The majority of perpetrators attempt to conceal fraud by altering or creating fraudulent physical and electronic documents.This isn't surprising since physical documents are much easier to falsify and difficult to trace. To mitigate these risks, we recommend replacing physical and electronic documents with trackable forms and automated workflows on your intranet. These workflows make it easy to validate information and keep a digital record of any changes made to forms.
3. Make fraud awareness mandatory
Key to fraud prevention is having anti-fraud policies and procedures in place. The challenge is that these documents often live on a network or bookshelf somewhere and are read once during onboarding and never again. We recommend housing anti-fraud policies on your intranet and making review a requirement at least annually. You can also share anti-fraud policy and procedure updates in your news feed to ensure employees are aware of changes and don’t wait until the next policy review cycle.
4. Assess fraud awareness levels
Even if you are regularly updating your fraud resource hub and using the required reading functionality to ensure employees are regularly reviewing anti-fraud policies, how can you be sure employees are actually aware of fraud risks? We recommend creating fraud awareness surveys, quizzes and polls on your intranet to assess employee fraud awareness levels on an ongoing basis. The great thing about these tools is they provide real-time feedback so you can quickly identify potential blindspots and where more resources are needed.
5. Make reporting easy (and confidential!)
Since most fraud is discovered through employee tips, it’s important to have a reporting function in place that provides anonymity. We recommend using the anonymous reporting function on your intranet to provide employees with a safe space to bring issues forward without fear of retaliation, while also giving organizations an opportunity to manage issues internally.
6. Tighten security
Many data breaches are the result of poor access control. This can be prevented by using custom permissions on different pages and sections of your intranet to ensure employees only have access to the data required to do their job. We recommend running a sitemap report periodically to confirm and verify current access levels and permissions. We also recommend enabling Single Sign-On (SSO) so system access can be easily disabled if fraud is suspected.
7. Build a positive culture
It’s not surprising that we have seen a sharp rise in workplace fraud cases since 2020. Remote work coupled with economic uncertainty has led to feelings of disconnect and dissatisfaction. Prioritize building a positive workplace culture by providing ample opportunities for your employees to connect and engage with each other. We recommend creating special interest groups, hosting virtual events, celebrating work milestones on your homepage, sharing personal stories in your blog, and providing new employees with a warm welcome as part of your onboarding process. When an employee feels connected to their organization, they will be much less likely to rationalize fraud.
8. Conduct regular pulse checks
Since culture is closely tied to employee fraud, it’s important to assess it on a regular basis. We recommend using the survey function to simplify regular pulse checks and establish feedback loops so you can gain insight into what is working and where additional resources may need to be invested. With in-app analytics, you can benchmark survey results and see how your results compare to similar organizations in your industry. More importantly, engagement surveys give employees a voice which helps them to feel valued and appreciated which benefits everyone.
Everyone plays a role
Whether it’s communications teams sharing fraud-related information, HR teams making fraud awareness a priority during onboarding, or IT teams managing employee technology permissions, fraud prevention is a responsibility every employee shares.
Have questions? Get in touch! We're always happy to hear from you.