What You Must Know About Fraud In A Small Business
Small businesses are the victim of fraud every day - now you found the fraudster - what action do you take. Firstly, Take advise from your accountants and legal team as if the fraud involves an employee and the situation isn’t handled properly, the company could get itself into a lot of trouble and expense. Secondly, Weigh up the costs and benefits to prosecute or not. Insurance companies may require prosecution to pay out and it would set a standard for other potential fraudsters. However, you must consider if the prosecution would give the company bad press, the likelihood the fraudster may be found not guilty, cost to the company in compensation and the company insurance costs could go up. Thirdly, Turn the situation around and take this opportunity to review the company internal controls policies:
- Are company policies adequate?
- Have policies been kept up to date with technology, law and the business?
- Are internal controls being implemented properly?
- Are internal controls being reviewed regularly?