Employee Fraud – Fraudulent Employees

Employee Fraud

Employee fraud is an ever growing concern of the business world. Steady growths in the number of cases of employee fraud are resulting in an equal growth of loss of profits as well as valuable resources of companies across the world. Employee fraud is not merely about monetary losses. There are fraudulent activities that also trade in valuable and sensitive information of companies. Such leakage proves to be detrimental in the growth and progress of companies.

Employee Fraud Prevention

There are several simple and yet useful ways to implement employee fraud preventions.

• Identify the departments and areas of a company’s functioning where frauds are possible. It will be easier to monitor and safeguard specific vulnerable areas from fraudulent activities of employees.
• In case of a fraud announce a reward for any information or witness to the act. This could be monitory or even a promotion or special appreciation from the company while keeping the confidence and identity of the worker under secrecy.
• A thorough check of each and every employee should be done before hiring them to work for a company. Adequate references as well as a check of their performances in their last place of work or even educational institutions should be made.
• A proper surveillance system should be present to alert all such employees prone to fraudulent activities. It should also be made common knowledge to all that the company will be strict in case of detection.
• There should be a general policy of a company to take good care of all its employees. Adequate wages and regular welfare policies will deter them from such activities out of vengeance or need.

Employee Fraud Cases

There are different examples of employee fraud cases. These are seemingly small but are extremely significant areas where frauds by employees are taking place in business organizations every year.

• Theft of Cheques
• Signature and Documents Forgery
  
• Misappropriation of Company Funds
  
• Misuse of Power with Regards to Company Orders and Tender Allocations
  
• False Representation of Company Accounts and Expenses

Employee Fraud Law

There are several types of employee frauds that are committed every year at different levels of a corporation. There are several ways that a company is advised to ensure protective measures against the perpetrators of wrongdoings within the company’s framework. There are also labor laws and other guidelines that a Company may adopt to ensure strict measures against any such personnel under its employment who is found guilty of fraud.

Companies have the right to enact certain rules of employment for its system of functioning. These are to be read and signed as a mark of acceptance by every employee at the time of employment. In case of any breach of the stated guidelines the Company reserves the right to take disciplinary measures against such employees. This could vary from pressing legal actions to outright suspension and or termination of services of the employee. In case of legal action being taken against an employee the company will require adequate evidence and witnesses to prove his guilt and thereby allow the court to decide the course of action to be taken against the convicted employee.