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Fraud Prevention Programs - Coggle Diagram
Fraud Prevention Programs
Increasing the perception of detection
Experts agree that it is much easier to prevent fraud than to detect it
Controls are not very effective in preventing theft
Effective management oversight
Employees who steal often use the proceeds for lifestyle improvements
Employees should know that supervisors are watching for unexplained
Employee anti-fraud education
Every employee within the organization should be required to participate in the fraud awareness training program.
should receive special training that addresses the added fraud prevention and detection responsibility
should have a policy for educating managers, executives, and employees about fraud.
awareness training should be an ongoing process that begins at the time of hire.
participate in refresher training at least annually to keep the program
Employees should also participate in refresher training at least annually
Proactive audit procedures
Techniques
Data and transaction monitoring and analysis
Fraud assessment questioning
Use of analytical review procedures
Surprise audits where possible
fraud awareness training
How fraud hurts the organization and employees
Common characteristics that lead individuals to commit fraud
What fraud is, including examples of what behavior is acceptable
and what is not
How to identify and report fraud
Tone at the top
management must show employees through its words and actionsthat dishonest or unethical behavior will not be tolerated
Management must create an environment in which employees feel safe
Reporting programs
Education Programs
Such conduct costs the company jobs and profits
The company actively encourages any employee with information
to disclose it
Fraud, waste, and abuse occur in nearly all companies
The report need not be made to one’s immediate superiors
Whistleblower support and protections
organizations can empower employees who wish to disclose information without fear
fear of being retaliated against for their disclosure
Minimizing employee Pressures
Fair personnel policies and procedures
Employee support programs
Open-door policies
Creating an Anti-Fraud Policy
section defining who is responsible for fraud prevention and detection
section detailing specific examples of actions that constitute fraud
A policy statement that formally defines fraud
section explaining who will investigate suspected irregularities
Developing ethics program
reasonably designed, implemented, and enforced
Written ethics policy