Internal Fraud in Nursing Homes
The potential for internal fraud in nursing homes is valid. Below are three examples of internal fraud in nursing homes:
- This nursing home bookkeeper entered no contest pleas to felony charges that she embezzled $300,000 from her employer. Police reported, “They trusted her. There were no checks and balances.”
- This former nursing home payroll/human resources department employee pled guilty to embezzling over $400,000 from her employer.
- This previously convicted nursing home fraudster/bookkeeper pled guilty to bank fraud and embezzlement of more than $55,000 from her most recent employer.
No matter how effective you perceive your internal controls—there is always the possibility of internal fraud in nursing homes. Administrators seldom consider the possibility of internal fraud in nursing homes. You can reduce your risk:
1) Recognize the Threat: Internal fraud in nursing homes is a real possibility. The profile of an employee who commits such crimes generally holds a position of trust, has greatest opportunity, is least suspected, and has little or no supervisory oversight.
2) Job Applicants: The initial step to minimizing internal fraud in nursing homes starts at the point of hire. Reduce your risk by conducting comprehensive background and credit checks on those applying for high risk positions.
3) Multiple Tasking: Reduce your risk to internal fraud in nursing homes by ensuring that no one employee has the ability to affect every stage of a critical work process. For example, the employee who handles accounts payable should not open incoming mail, be responsible for accounts receivable or monthly bank reconciliations.
4) Supervisory Oversight: Proper oversight and monitoring help to ensure that adequate internal controls are in place and enforced.
The above four steps will help deter internal fraud in nursing homes.
If you are interested in learning more about ways to prevent internal fraud in nursing homes, buy Business Fraud: From Trust to Betrayal today!