From Entrepreneur Magazine (Contributor Keith Mueller): Whether it’s divulging a company’s intellectual property to another party, forging fraudulent checks or stealing merchandise right off the shelves, employee theft and fraud are among the most serious threats to the success of businesses today.
The 2014 Global Fraud Study released in May by the Association of Certified Fraud Examiners determined businesses can lose on average 5 percent of revenue each year to fraud, pegged at nearly $3.7 trillion across the globe. The study also reports that more than 1 in 5 of the nearly 1,500 cases analyzed in more than 100 countries had employees walking out the door with at least $1 million in cash.
Lack of employee trust and job satisfaction coupled with careless hiring and supervision can — and has — led to vulnerable businesses that are ripe for internal theft and fraud.
Implementing internal and external controls and systems, as described below, can help a company reduce the risk of theft and hopefully catch any would-be rogue employees.
1. Conduct pre-employment background checks.
A strong hiring process is critical to the health and longevity of a business in more ways than one may think. Business owners must do due diligence when hiring a new employee, arranging for background checks and contacting references. This will help weed out a lot of the potential rogue employees from the outset.
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