{"id":1690,"date":"2018-04-06T15:53:00","date_gmt":"2018-04-06T15:53:00","guid":{"rendered":"https:\/\/www.realtrends.com\/blog\/2018\/04\/06\/company-fraud-exists\/"},"modified":"2025-03-13T02:29:33","modified_gmt":"2025-03-13T02:29:33","slug":"company-fraud-exists","status":"publish","type":"post","link":"https:\/\/www.realtrends.com\/blog\/2018\/04\/06\/company-fraud-exists\/","title":{"rendered":"Key Indicators That Fraud Exists in Your Company"},"content":{"rendered":"

It\u2019s great to have employees you can trust, but stay vigilant. Look for these key indicators that something may be amiss.<\/em><\/strong><\/p>\n

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Follow Your Gut<\/strong><\/p>\n

If you feel like something is not quite right, it probably isn\u2019t. Note changes in your employees\u2019 behavior, whether it be emotional conduct or lifestyle changes. Does your sales manager, who has not recently received a raise or experienced significant personal life changes, suddenly sport a new wardrobe and a new vehicle? Take note. Is the accountant who is responsible for reporting for your brokerage suddenly unavailable and overwhelmed and did not have the time to review financial information and answer questions? Take note. These changes are not necessarily indicative of fraud, but, in hindsight, many who have detected fraud in their own companies noticed these things.<\/p>\n

Familiarize Yourself with Company Vendors and Employees<\/strong><\/p>\n

If you scanned a list of your brokerage\u2019s vendors, could you identify additions and outliers? Depending on the size and structure of your office, there may be only one or two people who manage this list. Most likely, they are individuals who you trust but don\u2019t let that trust overshadow the need for you to protect yourself and your business. On a periodic basis, ask for a vendor list and amounts paid to each vendor. Ask questions about any that seem unfamiliar. Every vendor may be valid, but often, fraud can be prevented if employees feel like activity is being regularly monitored.<\/p>\n

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You may know the first and last names of every person in your brokerage. You may know their roles, compensation levels, birthdates\u2014even their favorite color. If that sounds like you, then this recommendation will be easy for you. Ask whoever is in charge of payroll to run a report of three different pay periods of your choice and the amounts paid to each person. Is there anyone on that report with whom you\u2019re not familiar? Are there any amounts being paid that make you scratch your head?<\/p>\n

If you have a large team, this may not be a reasonable recommendation. In larger organizations, I recommend having paystubs or paychecks for all employees provided to you and other management. Hand-deliver them to each employee. Worst case scenario, you will find an employee or two who does not exist. Best case scenario, you meet more of the individuals who support your business on a daily basis.<\/p>\n

Reduce the Opportunity for Fraud <\/strong><\/p>\n

The top three factors that cause employees to steal from their employer are pressure to commit fraud, justification of their right to steal (i.e., \u201cI should have received a bigger bonus\u201d) and opportunity. As an employer, here\u2019s how do you combat this behavior:<\/p>\n