Why Speed and Training Matters
Rod Smith, Director of Internal Controls
The Association of Certified Fraud Examiners (ACFE) annually publishes their Report to the Nations https://www.acfe.com/report-to-the-nations/2020/ – this is a global study on occupational fraud and abuse. In the Report, they share that formal training programs help organizations detect and prevent fraud significantly. Over the past decade, while anti-fraud controls have increased, a third of fraud is still attributed to the lack of internal controls (this includes not properly training employees on fraud awareness).
This month, I want to share with you why the speed of detection is so important in thwarting fraud. One of the most important defenses in preventing fraud is how quickly the fraud is recognized. When fraud is spotted early, it allows the organization to quickly switch over to an offensive position and prevent the scheme from materializing, thus costing funds. But again, how can employees recognize fraud without appropriate training? If employees are trained on awareness, they can quickly recognize the attempt and end it there.
I often share with folks that just an attempt of fraud will cost an organization. For example, let’s say a fraudster contacts your organization to deceive and/or attempt to obtain goods under false pretenses. Just the fraudster making contact is already costing you in labor, loss of production and resources. Fraudsters are increasingly calling organizations and emailing employees attempting to deceive them and/or tricking them into providing sensitive data – we are no exception. So, the moral of the story is to teach your employees on recognizing fraud quickly and so they can shut down any attempt.
I encourage you to have meetings with staff and train employees on recognizing fraud, waste and abuse and how to properly report it. I also want to remind you to train your employees on University policies and procedures and the best practices already set in place. We must follow them to uphold our standards so that we don’t compromise our internal control system.