$1.8 Million - GONE! Is your company next?
Without anyone’s knowledge or authorization, a bank employee initiated a series of wire transfers, of funds maintained at the bank, to fictional account entities that the employee had fraudulently created. The bank’s investigation revealed that the entities were set up with the bank employee’s name as the owner. Once an entity received the money, it then transferred the funds to overseas accounts. Could this happen to your business?
Regardless of size, all businesses are a possible target for employee dishonesty and other criminal activity. Even the best policies, procedures and other internal controls cannot deter the most deceptive criminals. Theft of goods or services, forgery, embezzlement, cyber-crime… the list goes on and on. Although there is no 100% guaranteed method to prevent an incident, there are measures that you can take to protect your business from significant and irreversible damage should you become a victim.
When your business becomes disrupted due to criminal activity, this can pose a serious risk to your reputation and bottom line. Disruptions can be caused from multiple avenues including the people you trust the most… your employees. According to Travelers Insurance, the average time before fraud can be discovered is 18 months. The amount of money, supplies or services lost can add up quickly and the ability to recover these losses may start to decrease with time. Investigation into these criminal acts may also take time and what does time equal? Money.
Some ways to prevent criminal activity from sources within your company may include: dual signatures on all checks, weekly board review of all financial activity, team decisions on contracts or vendors, early detection and intervention when appropriate. Employees who know that their work is being closely monitored may find the criminal or fraudulent activity less appealing. These actions will decrease the opportunity and increase your internal protection. Criminal activity from the outside is also a risk associated with business. Security systems, passwords, key control and references are just some of the ways to deter crime from entering your workplace.
Protection of assets and reputation may be found with Crime Insurance from Haylor, Freyer & Coon, Inc. We work with insurance professionals from around the world to develop a policy that will best fit the needs of your business. Our goal is to deliver results through partnership in a timely manner and we are dedicated to help in your time of need. Click here to further investigate previous ‘business crime’ claims examples.
