Employee Credit Card Abuse —Monitoring Is Crucial
Employee credit card abuse is not only widespread— it’s legendary. No matter how trustworthy you perceive your workers —there is always the risk of employee credit card abuse. Examples:
- Bookkeeper charged with allegedly embezzling $160,000 by charging ATM transactions to a business credit card and transferring the money to her personal debit card.
- Employee sent to prison for using his company’s credit card to purchase over $600,000 in equipment for his personal business.
- A credit card company’s call regarding an overdue bill of $60,000 uncovered a $900,000 scheme the employee perpetrated using a business credit card to obtain fraudulent loans.
Generally, there are a number of red flags when it comes to employee credit card abuse. Yet, an overwhelming number of employers fail to spot these warning signals. Here are five tips to help prevent employee credit card abuse:
- Collaborate with Card Issuer: A variety of “behind-the-scenes” measures are available to prevent employee credit card abuse. Find out what your card issuer can do for you.
- Communications: Clearly communicate and put in writing your policy to employees including what happens to abusers. Also, frequently remind employees that having a company credit card is a privilege—revocable on the slightest sign of abuse.
- Set Deadlines: Require all monthly charge receipts be turned-in on/prior to a specific date.
- Monitoring/Reconciling: It is extremely important that a careful review by made by someone in authority to ensure that there are no violations of the employee credit card abuse policy.
- Strict Enforcement: Perhaps the most important aspect of any company policy is enforcing it, and the policy pertaining to employee credit card abuse is no exception. Ensure that a careful and consistent review is performed, employees are aware of this review, and those monitoring know what they are approving.
Learn more ways to deter employee credit card abuse and pick up your copy of Business Fraud: From Trust to Betrayal today!