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First Step to Fraud Prevention


Most businesses worry about what to do after they have found that they are a victim of Fraud, but why is nobody talking about fraud prevention?

Probably because you can not point a finger at one certain type of individual as a potential culprit, Fraudsters can be from any ethnic background, male or female, and from any walk of life.

Fraud doesn’t just happen there are a certain set of rules that must be aligned if you will for fraud to occur, the person has a NEED, they have an OPPORTUNITY to fill that need, but the biggest one; RATIONALIZATION.

I can tell you I did not plan to take the money, I had a need, to take care of my children, I was afforded an opportunity to fulfill that need, and I rationalized it by saying I would pay it back once I got my raise.

Simple, right? Wrong, I would never have thought I would take money, and I wouldn’t, except I had a need that overruled the common stop point in a person’s heart and brain.

I never thought about the consequences, I doubt anyone that does this really thinks “hmmm I shouldn’t do that cause I may get caught, or go to jail” that does not enter into your mind you are focused on solving the need.

I never stated it was for filling an addiction, because the only addiction I had to fill was to take care of my family, and to eat. Simple but still not ok, was there another way to solve the need, probably but I didn’t think of those things when I committed the crime.

There have been studies done about fraud in businesses, and believe it or not even the professionals can not tell you why or how this happens, at this point in time the males tip the scales slightly for committing the fraudulent crimes, but as you will surely notice the women are gaining in number for that group as well.

All any individual needs is to have a circumstance that pushes them to the edge, we live in a society that really promotes the “he who dies with the most toys wins” philosophy.

This keeping up with the Jones’ is a problem, cause everyone wants to keep up or surpass their neighbor, some people play the lottery, hoping to hit the jackpot, I do, its an American Dream realized to come into a large some of money, but that is not what lends itself to fraud, it is the mentality that you have to have the latest and greatest, of most everything, when maybe a used, or refurbished one would work just fine.

The key to prevention is what I focus on, had I not had the opportunity or believed more strongly that I would be caught the first time I would not have attempted it, and that is what I am attempting to help businesses with.

So by now you want the magic wand to prevent fraud from ever darkening your doorstep, Right? Not that easy to employ, sorry.

The first thing to look at is how you do business, if you are an ethical employer you have little to worry about right? Wrong. Even if you are the most ethical person on this planet you may still have someone in your organization that is not looking out for your best interest; that said there are few things even the most ethical person can do to avoid fraud.

You can be aware of your employees, and what is happening in their lives, did Jane just have a new baby or maybe she became a grandma for the first time or the 15th, these are stressors in a persons life, children are a joy, but reality is that with a child comes more responsibility, more money and truly that old phrase “2 can eat as cheaply as 1” yeah it’s a lie.

So what would you do for Jane in her new status of life? Well talking to her asking her how things are going, that is a start, but can you afford to do more for her? Maybe giving her a half day off with pay would be a good gesture, I am not saying that every person will view that as acceptable, but it is a start.

Maybe Joe is getting a divorce, I can tell you from experience this is a MAJOR stressor, so ask him “Hey Joe, how are things going? Is there anything I can do to help you?” again this is not going to stop a person from defrauding you all the time.

I can tell you that if you are involved with your employees, and treat them kindly and with a genuine desire to see them prosper they are more likely not to steal from you. I am not telling you to be a pushover in your own business, but if a person feels like they are dog dirt and only a means to an end for YOU to prosper, they are more apt to have an easier time rationalizing or justifying their actions against you and your company.

If you would like more help in preventing fraud in your business please log onto www.dlbandassociates.com for information, and to contact me, you are welcome to comment here, or on my website.

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