Preventing Fraud in the Digital World: Is that Even Possible?

The digital age we currently live in makes it so much easier for criminals to steal from us, and with far less risk.Equipped with high-tech devices, software, and the proper knowledge, sophisticated criminals are raking in an astounding $3.5 trillion every year – money lost globally to online fraud. Cloud computing, the rise of smartphones, and the ever-increasing popularity of social networks – all essential aspects to a hyper-connected community – are considerably easing fraudsters’ work.

While classic techniques such as telemarketing scams or the 419 scam (also known as the Nigerian scam) are still popular, Internet scammers are also taking advantage of today’s advanced technologies to up their game. If, in the past, they used to target lonely, old victims and appeal to their emotional pull, these days, conmen are becoming much more ruthless in their crimes. Raiding big corporations’ bank accounts or even taking out governmental programs is not unheard of, making it more obvious than ever that we’re all at risk.

And yet, there are ways to fight against fraud; perhaps not foolproof, but they can decrease our vulnerability and make communication and information sharing more secure. Here are five ways business owners can protect themselves from internet robbers:

1. Hire the right people. Employees are a vital part of your business – it’s only natural to ensure they’re working for you, and not against you. Conducting background checks, drug screenings, and checking personal and professional references will allow you to get to know your employees better (especially those handling money or inventory).
2. Catch them in the act. Conducting surprise audits to catch ill-intended employees off guard could speed up the process of discovering fraud – and also save you a lot of trouble. Auditors use computer data analysis techniques to uncover illicit activities, and they can quickly examine thousands of documents at once and determine if there’s anything suspicious. A surprise audit can uncover duplicate invoices and also analyze invoice numbers, red-flagging criminal activity and catching employees red-handed.
3. Set up a fraud policy. Make sure the people working for your company are aware that you have a zero-tolerance policy for fraud and that several methods will be used to catch and punish illegal activity.
4. Monitor operations. This should go without saying, but installing security cameras to monitor activity at cash registers or in inventory areas is central to preventing fraud and ensuring a safe business environment. Employees who know they’re being watched are less likely to engage in wrongdoings.
5. Get employees to talk.Research shows that an effective method of combating occupational fraud is receiving tips from employees, but not many of them will be willing to talk directly to a supervisor. Establishing a third-party service that can offer the anonymity in-house programs cannot might help detect suspicious activity in time and act on it promptly.

All of these methods can help you remain in control of your business and identify suspicious activity in a timely manner. It also helps to maintain a proactive, rather than reactive, attitude towards fraud in your organization, analyzing data and identifying patterns to recognize malicious criminal intent. As business owners, employees, or customers, we must work harder to protect our identity and assets during times when it’s more difficult than ever.

About the Author Andrew M. Weisberg is a criminal defense attorney in Chicago, Illinois. A former prosecutor in Cook County, Mr. Weisberg,is a member of the Capital Litigation Trial Bar, an elite group of criminal attorneys who are certified by the Illinois Supreme Court to try death penalty cases. He is also a member of the Federal Trial Bar. Mr. Weisberg is a sole practitioner at the Law Offices of Andrew M. Weisberg. [if gte mso 9]> Normal 0 false false false EN-US X-NONE X-NONE

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