The Examiner – Insights on Fighting Financial Fraud

With a tropical system threatening the Gulf Coast, we haven’t noticed it here. The conference is perfect just like Nashville’s weather. The following are a few highlights from day two of the ACFE’s 28^th Annual Global Fraud Conference:

With over 3,000 professionals from more than 60 countries, this year’s conference is off to a great start. The day was packed with exciting presenters who shared their experience and knowledge. Here are a few highlights from day one of the ACFE’s 28^th Annual Global Fraud Conference:

This Sunday, I will be traveling to Nashville for the ACFE’s 28^th Annual Global Fraud Conference. The conference starts bright and early Monday morning, and when I signed up, I didn’t realize that I would not be able to celebrate Father’s Day with my family.

This past Saturday, April Fool’s Day, my daughter was excited about telling a few lies. She started by placing black tape over the front of the remote control which made it seem as if the TV didn’t work when my wife tried to turn it on. This was an innocent and fun lie that caused very little emotional distress. For her next lie, she created a bit more drama.

As mentioned in last week’s post, there are numerous similarities when fighting fraud and cybercrime. This week we will highlight a HORNE Cyber blog post that covers five ways to secure your data. Within this blog, cybersecurity advisor Mike Skinner covers areas such as performing a risk assessment, testing vulnerabilities and increasing employee awareness—all areas that can also help business owners and executives fight fraud. Read about all five ways to secure your data in HORNE’s Cyber blog below. 

“An ounce of prevention is worth a pound of cure.” This statement was from one of our founding fathers, Benjamin Franklin, who was speaking about fighting fires. But he could have been talking about the Oscars Sunday night and the internal controls that PwC had in place to ensure that the proper winners were announced.

Numerous organizations simply check the box when it comes to implementing a hotline without focusing on the hotline’s effectiveness. This can be even more detrimental to the culture of an organization than not having a hotline at all. An effective hotline can bring your organization tips that can help your organization identify and mitigate fraud.

We know that tips are one of the best sources for detecting fraud and that hotlines are a great way to capture tips. If that’s the case, then why do companies often choose not to have hotlines? In victim organizations, the organizations with greater than 100 employees had hotlines in 74% of the cases, and for the smaller organizations, hotlines were only present in 25% of the cases. This is staggering because the implementation and management costs are minimal and the benefit of discovering fraud is huge.

In our daily lives, we trade tips with other people all the time. Every so often, I receive a tip from a friend about a new restaurant and we discuss his dining experience. If positive, I might be encouraged to try it out, but if it was a negative experience, I will take heed and stay away. And, just as I receive tips, I also provide them. But tips are only helpful if we choose to use them—which brings me to last week’s blog.

Most will agree that fraud costs businesses a lot of money, but there are many business owners and executives who don’t believe fraud is a real risk to their organization. And for those who may see fraud as a risk, it is likely that they underestimate the potential dollar impact. Why do people ignore or underestimate the risk of fraud?