FRAUD costs businesses more than $1 billion a year and most indications show it is on the rise, thanks to the increased pace of business and greater reliance on computers.
According to KPMG’s Fraud Awareness Survey, the bulk of company frauds were committed by non-management employees.
One of the most basic protections against fraud is to ensure the person doing the accounts payable is not the same one signing the cheques.
But, in small businesses, such separations are difficult.
Mark Andrews Lawyers partner Graham Pidco said small business owners should consider fraud prevention measures when setting up their business.
“They should get a registered risk management specialist in to do an appraisal of their business and stick to what the report says,” Mr Pidco said.
“They also need to screen potential employees. If the employee will be dealing with cash they should have police clearance.”
Deloittes Touche Tohmatsu forensic practice head Martin Langridge said small business owners needed to pay attention to what was happening in their businesses.
He said one of the common ways businesses were defrauded involved paying duplicate invoices.
