How to protect against Employer Fraud

Posted Thursday, June 25th, 2015. Filed Under Corporate - Tips/Tools Blog

Reid Lester, a lawyer with the Toronto firm of Laishley Reed, who specializes in fraud, gives the following advice:

* Business owners should insist on segregation of duties – The people empowered to sign the cheques should never be the same people who approve monthly bank statements.

* Instil fraud awareness in your organization – a 2008 U.S. study estimated seven percent of all corporate revenues are lost to fraud.

* Require two signatures on each cheque.

* Never pre-sign a cheque.

* Issue cheques in numbered sequence, and don’t let them get out of order.

* Invite a forensic accountant to visit your business and advise on appropriate controls for the size and nature of your company.

* Vet all new suppliers to make sure they are real.

* Pre-screen employees and always check references.

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