Fraud Prevention Tip #8: State Anti-Fraud Expectations

This simple no-cost tip is missed by the majority of organizations. From the CEO down to first level supervisors, anti-fraud expectations must be said out loud.

Make it a requirement that during a staff meeting every supervisor share their personal expectations with their subordinates.

While discussion tailored to each supervisor’s own beliefs works best, here are some ideas to help them get started. Tailor this list to your own environment and distribute the result. Include examples to make the each talking point come alive.

I expect everyone to:

1. Know the fraud exposures in your areas of responsibility. For example…

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2. Know what it would look like if it happened. For example…

3. Use best-faith efforts to minimize the chance of fraud or other wrongdoing on your watch. Examples include…

4. Make sure the transactions you personally approve are not fraudulent. Here’s an example of what I mean…

5. Personally monitor for those frauds that only you are in a position to detect. For example…

6. Question and challenge the unusual. Here’s are some examples from our reports to illustrate this…

7. Set an example of honest behavior by personal example and by not tolerating dishonest or unethical behavior in others. For example…

8. Prevent fraud in your area by minimizing the exposures and reducing the opportunities and temptation. Here a few things we can do every day…

9. Immediately refer suspected wrongdoing to [Internal Audit, Legal, Security, other department] for investigation. For example…

Here are some instructions that will help:

1. Frame the discussion to include questions staff members will have.

2. Stress the importance of a balanced message – tie your request for help to the listener’s normal pride in their work.
3. Be explicit. Don’t beat around the bush. Tell them EXACTLY what you expect and what you need them to do as a result.

4. Use a positive tone. Make it a ‘call to arms’ that starts with, “I need your help to fight this problem.”

5. Include examples of what could go wrong in your area, including what it would look like in reports, variances, complaints and other indicators of a problem.

Openly discussing anti-fraud expectations may just be the most important step managers can take to fight fraud. It’s free. It’s easy. It’s critical.

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.”