Best Practices for Fraud Prevention and Deterrence in 2024
Preventing fraud is better than detecting it after it happens. Open discussions about fraud help reduce the risk of it occurring. Fraud Awareness and Prevention Week is the perfect time to act and strengthen your organization's fraud defenses. Some organizations may still be afraid to raise the topic of fraud, believing that employees will be inspired to attempt to commit fraud or assume that a large fraud occurred within their organization. However, discussing fraud openly within an organization is a proven way to help prevent it.
Here are steps all employees can take:
- Attend anti-fraud training and stay informed.
- Know how and when to report suspicious activity.
- Use confidential reporting systems.
- Promote honesty and integrity in your daily work.
All employees play a vital role in maintaining the integrity of our work processes. One effective practice is to periodically pull random samples of your work and review them for accuracy and completeness. This proactive approach not only helps identify potential errors but also reinforces our commitment to quality and accountability within the organization.
To help you get started with implementing strong anti-fraud measures, consider the following actionable steps. These practical recommendations will not only enhance our organization's integrity but also empower each of us to contribute effectively. Review this checklist to identify key practices that can implemented at any time.
Checklist to Get Started:
- Participate in ongoing fraud training.
- Understand the importance of reporting and know the procedures.
- Check if there’s a clear and confidential reporting system.
- Be aware of the organization's controls to detect fraud early.
- Take note when fraud is mentioned in news or discussions and consider how similar risks could be prevented in your organization.
- Show interest in fraud prevention stories to deepen your understanding and improve awareness of potential threats.
- Save important reporting procedures, contacts, and documents in a convenient, easily accessible location like OneNote. Label saved information clearly to prevent delays and streamline the reporting process.
Taking these steps helps strengthen the organization’s defense against fraud. Now that you have reviewed the key practices to get started on fraud prevention, it's essential to focus on the specific internal controls that can further enhance our organization's integrity.
The following internal controls checklist provides actionable steps to ensure we maintain a robust framework for preventing and detecting fraud effectively.
Internal Controls Checklist:
- Understand the separation of duties in your role.
- Access systems only as necessary for your job.
- Reconcile financial records regularly if applicable.
- Follow approval processes for high-value transactions.
To safeguard our organization from financial and reputational harm, it is essential for everyone to actively implement strong anti-fraud measures.
Explore tools, checklists, and resources to stay proactive in preventing fraud!
For more in-depth resources and toolkits, visit the ACFE Fraud Prevention Resource Center.
About ICA
Minnesota Management and Budget’s Internal Control and Accountability Unit (ICA) offers resources, training, and consultation for executive agencies to prioritize and document their internal control systems. The unit offers content for Fraud Awareness and Prevention Week for a tenth consecutive year, aligning with the Associated Certified Fraud Examiners (ACFE) annual International Fraud Awareness Week.
Resources:Occupational Fraud 2024: A Report to the Nations.
Resources
Review the following videos and articles for additional information on fraud detection and negative effects of weak internal controls.
Table 1: Short video clips, video length, and video description
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Video Link and Description of Video |
Video Length |
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3:26 |
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1:46 |
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4:18 |
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2:36 |
Table 2: Resources and resource descriptions
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Resource |
Description of Resource |
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ACFE Insights Blog |
Beyond Checking the Boxes: Establishing a Fraud Prevention Plan |
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ACFE Insights Blog |
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ACFE Insights Blog |
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ACFE Insights Blog |
Prevent Fraud Before It Happens: How to Train Employees to Be Fraud Detectors |
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ACFE Insights Blog |
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ACFE Fraud Prevention Check-Up |