A recent CFO article detailed how CFOs can stay ahead of the game by monitoring specific areas for employee fraud. Among the top 5 areas where employee fraud commonly occurs included purchase-to-pay, corporate credit cards, payroll, sales and receivables, and information systems and critical data. While it is essential to monitor in these areas to stay ahead of fraud, we find the action that follows monitoring is key to successfully fighting fraud and compliance efforts in general.
First we have to validate the findings to avoid false accusations. For bona fide fraud we have to open a case and typically invoke other departments such as HR and legal. For relatively minor policy infractions (think abuse as opposed to fraud) an email to the transgressor and their manager will correct the behavior and let it be known that you’re watching. These transgressions should be tracked through time so that repeat offenders can be identified and stringently addressed.
If you’re not acting you might as well not monitor either. Both activities must be done on an ongoing basis to be effective, as spot checks and samples will most likely miss fraud. To perform this at scale, leverage technology to make it efficient.