September 16, 2014 – Vicki Pero – Insights

What Happens at Your Company When You Suspect Fraud?

When the term Audit is used in the parking industry, it covers three functional areas: loss prevention, fraud investigation and location (internal) audit.  The fraud investigation component sometimes presents a challenge, because many companies don’t have a documented process defining roles and responsibilities to investigate fraud allegations when they arise. Establishing a process that all employees follow when fraud concerns arise can save your organization time and money.

Prepared Vs Unprepared Advantage of Being Ready or Unready
Prepared Vs Unprepared Advantage of Being Ready or Unready

Put Someone In Charge

The first step your company can take to implement a fraud investigation program is to put someone in charge. Common roles that take on this responsibility include the head of Audit, HR or a combination of the two depending on the issue type. Without this, every manager is likely to handle these investigations on her own, which can result in lost time, inadequate documentation collection and loss of quality control. This can also jeopardize investigation independence leading to more problems down the road if impacted employees ever dispute the investigation’s conclusion and outcomes.

Establish a Fraud Investigation Policy and Procedure

Without an established fraud investigation policy and procedure, each time an issue arises it feels like it’s the first time. Valuable time can be lost while employees try to determine an appropriate course of action. In addition, the rights of employees may be violated depending on how the investigation is conducted which can result in payment of lost wages during a suspension or due to a termination where reinstatement is required.   Create a fraud investigation policy and procedure that clearly defines each step of the process, so that when these issues arise, everyone knows their role and can act accordingly.

Communicate & Train

The policy and procedure will only be effective if employees are aware of it and understand how to perform their role. Communicate the policy and procedure to all employees within the organization, and ensure everyone has easy access to it by posting it on a company intranet or other location where employees can obtain it. Provide employees training support that correlates to their responsibilities with the policy and procedure.

Want to Take Your Program to the Next Level?

Establish a fraud hotline where employees can anonymously report fraud concerns and other policy and procedure violations. This can be a 1-800 number, online portal or both. The key to a hotline’s success is ongoing communication regarding its existence from the top down and program set up that truly offers anonymity with an established protocol to respond accordingly.

Fraud is a potential reality for all companies. Making sure your company has a plan to deal with it when it arises will set you apart from the competition and help you avoid lost time and money.

Are you interested in more information about fraud investigation best practices? uDrive subscribers have access to tools and templates that can help. These can be found in the HR Tools section of the site.