Small Business Fraud —Destruction at its Worst
Dire situations are confronting small businesses throughout America. As the economy worsens, businesses are taking a number of drastic steps to survive. Severe job cutbacks and increased employee workloads are becoming the norm.
Small business fraud can happen in any operation at any time and the current economy is adding to this problem. Anytime employees feel underpaid, overburden, or taken advantage of, they can become more likely to commit small business fraud. In fact, the Association of Certified Fraud Examiners reports that 30 percent of small business fraud took place in businesses with 100 employees or fewer, and 53 percent in businesses with fewer than 1,000 employees. Without question, small business fraud is a big issue not to be ignored.
Anytime small business fraud is uncovered, evidence generally reveals that management failed to have in place or perform a few basic safeguards or failed to provide sufficient oversight to high-risk financial activities, and those breakdowns allowed the small business fraud to flourish. Failure of management to recognize that without adequate internal controls and oversight, any high-risk job function delegated to even the most trusted employee can quickly lead to small business fraud and financial disaster.
Anytime a single employee is allowed to control every stage of a particular work process—an excellent opportunity is created for that individual, if dishonest, to commit small business fraud. Virtually all incidents of small business fraud are avoidable or promptly detectable.
Learn strategies on preventing small business fraud by ordering your copy of Business Fraud: From Trust to Betrayal today!