Fraud Prevention: How to Reduce Your Risks

a man looking at a screen while holding a credit card

In 2017, close to 16.7 million people were victims of this awful crime in the United States alone, and stats are only increasing with each year. Fraud targets not just individuals, but businesses both large and small as well. In fact, of these affected victims, $16.8 billion was stolen in total – a number that might quite literally make you cringe. 

So, what’s behind the alarming statistics and why do these numbers seem to continue escalating? For starters, as more of our daily lives involve the digital realm, the physical barriers that used to distance us as individuals are dwindling rapidly. Of course, the digital world is incredible in various ways; it allows for instant communication, online business transactions, research, and more. Essentially, we have access to information whenever we need it. With such accessibility, however, comes a level of vulnerability that exposes us to potential fraud. There were 10,343 data breaches recorded between Jan. 1, 2005 and May 31, 2019.

 

National Fraud Awareness Week 

For the millions victimized by fraud, the Association of Certified Fraud Examiners (ACFE) has marked November 11 to 17 as International Fraud Week, a global initiative to raise awareness about anti-fraud education and ways in which you can prevent fraud both on a personal and business level. This speaks to the growing issue of fraud. 

Fraud Week is the perfect time to address whether you are doing enough to reduce your risk of fraud. Consider addressing the following: Could you be implementing additional security measures? Are your staff properly trained on internal processes? Are sensitive documents being disposed of properly? Are your employees using password protection habits?

 

If you’ve decided you could improve your efforts when it comes to protecting your business against fraud, you’re not alone. Let’s look at some key suggestions the ACFE highlights in lowering your company’s exposure to this crime:

  • Be proactive: Create and implement a code of ethics for management and employees. All employees should be held responsible regarding fraud prevention. Each should be fully aware of what fraud entails in the workplace and the consequences of failing to practice preventative measures.  
  • Establish hiring methods: As companies grow and continue to evolve, operations change which require new security controls. During the hiring process, it’s important that you reevaluate how you conduct your hiring and if you have the proper background checks in place for your security. Also consider what information they will have access to, as hiring the wrong person could compromise your business.  
  • Train employees in fraud prevention: Be familiar with the varying types of fraud your business could encounter daily. Is your business more susceptible to credit and debit card fraud, or is identity theft the biggest risk? Knowing the potential threats that could target your company will help you to create a risk assessment and mitigation strategy that addresses these main concerns. 
  • Use a fraud notification system: Statistically speaking, over half of all business fraud is committed by individuals inside the organization (frightening, but true). If your company has a secure, anonymous communication source in place, you can rely on your staff to come forward with honest tips should they hear or witness activities in the workplace that are questionable. 
  • Increase awareness: Empowering your staff with the training required to combat such a crime is your greatest armor against such threats. Communicating and educating your staff regarding anti-fraud policies and techniques can be an excellent line of defence against threats. Empower those in your business so that they have the knowledge to do their part in maintaining the security of your systems and information.

Document Shredding Can Do Wonders in Fraud Prevention 

Identity theft results in the loss of millions of dollars to the economy every year.  In addition to the financial costs to businesses in terms of legal liability and data breach notification, fraud and identity theft also can have a measurable impact on the following:

  • customer trust
  • shareholder confidence
  • brand image
  • employee morale

What’s the easiest first step in preventing identity theft and fraud? Ensuring you are looking after the proper disposal of your sensitive records. 

Desert Document Shredders will destroy your confidential records beyond recovery, eliminating the risk of lost or stolen data that could otherwise be very damaging to your company. Our document shredding solutions are simple and cost-effective. Most importantly, they protect you from the alarming statistics discussed above.

If you haven’t outsourced your document shredding needs yet, consider doing so.