Fraud Prevention Tip #25: Resolve or Refer Suspicions

So there you are, an entry-level staff accountant. Just six months with the company.

You’ve attended the required ethics, Code of Conduct, and anti-fraud training programs. At the fraud training, you made a list of example red flags, indicators and symptoms of wrongdoing and fraud that you might see in your daily work. Just like the instructor told you to do.

Since then, you have paid attention. You have ‘doubted’ rather than ‘believed’ when something didn’t look right to you. But everything always checked out, and a few times your supervisor asked you if maybe you weren’t overreacting.

Right now you’re staring at a contractor invoice in the middle of your desk. You think it’s wrong, and likely a sign that the contractor is trying to rip-off your company. But you’re not 100% sure. Maybe not even 20%.

What would you do? What should you do?

This is the all-important moment of truth. What I refer to during my live training seminars as The Anti-Fraud Moment. This is the moment where you have a document in front of you, a pen in your hand or fingers on the keyboard, and if you approve what you see it moves through the process and gets paid.

But it looks funny to you. You think you should raise the alarm, but worry about being wrong and offending a trusted business partner.

At this moment, every employee must know exactly what to do and what to avoid. Here’s what they need – and it’s up to Anti-Fraud Leaders to make sure it happens:

1. Clear instructions on how far they should go on their own to resolve their doubts.
2. Clear instructions on when to ask for help.
3. Clear instructions on who to ask for help.
4. Clear instructions on how to ask for help – especially if they prefer to remain anonymous.
5. A fact-based belief that they are never alone at these moments of doubt. That they are heroes – not whistle-blowers. No one wants to be a whistle-blower. Everyone wants to believe that they will do the right thing at the moment of doubt. Just like any hero.

Make it easy for people to report suspicions. Treat them with respect when they come forward. Congratulate them and say thank you.

Our front-line employees are our first and often last line of defense against fraud. Help them deliver on what we need them to do when they see something odd. Tell them when and how to refer their suspicions.

John J. Hall, CPA

John J. Hall, CPA, is an author, speaker and results expert who presents around the world at conventions, corporate meetings and association events. Throughout his 35-year career as a business consultant, corporate executive and professional speaker, John has helped organizations and individuals achieve measurable results. He inspires audience members in corporations, not-for-profit organizations and professional associations to step up, take action and “do what you can.”