Top fraud prevention tips for Small Businesses

Fiona Hotston Moore
Small businesses employing less than 100 people are statistically most at risk from fraud. The National Fraud Office reports that out of 500 businesses surveyed, 136 had detected and experienced fraud. That’s more than 25% - and what about the fraud that goes undetected and unreported?

 How can a small business prevent a fraud taking place?  Here are a few pointers:-

·       Look at how cash and bank deposits are handled. Avoid keeping a large supply of liquid cash in the safe and implement double-checks when handling cash.

·       Put greater controls in place over on-line banking. Not just over the amounts which can be moved but the creation of new payees.

·       Beware if the same person who controls the physical movement of cash and banking also controls the records as fraud is harder to detect quickly. Randomly check work to ensure it has been done correctly and to keep people on their toes.

·       Take a fresh look at who has access to the computer record keeping, stock control, cheque security and safe keys. Avoid temptation. And don’t forget a fraud can take place by the creation of false purchase ledger invoices.

·       Keep up to date with money laundering training, it’s important that staff can spot a financial scam which may come from outside the business.

·       Keep an eye out for unusual transactions – anything out of the ordinary. Monitor cash flow patterns, stock patterns and expenditure levels, and never avoid asking the difficult question.

·       Keep in mind that a common themes in fraud is that the flow of information is nearly always controlled by the guilty party. Especially when there are no random checks.

By putting straightforward systems into place a small business can reduce the risk of fraud however, if you think there is something amiss don’t ignore your instinct and get things checked.

To discuss concerns regarding business or employee fraud please speak with Ensors Chartered Accountants

forensics partner Fiona Hotston Moore. @


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