Businesses suffer an average loss of $140,000 for each instance of employee fraud. 40-50 percent of victims don’t receive any compensation.
Internal fraudThis is not only a threat. Sometimes, it can be crippling. Small businesses are most at risk.
According to an ACFE survey, the most severe losses are suffered by the smallest businesses. Damages start to mount after 18 mois of internal corruption. This is the average amount of time before fraud detection.
There are however, some advancements in advanced security measures that discourage employees from taking advantage their company’s offerings.
“The ACFE report shows antifraud controls, including cameras, have significant impact on losses due to internal fraud. High-definition cameras offer superior image quality, providing the best evidence against false fraud claims,”Alexander Fernandes, President and CEO of Avigilon is a global supplier of HD video surveillance systems.
Anti-fraud measures are worth the investment when organizations lose almost 5 percent of their gross revenue to fraud every year. ACFE data shows that most fraudsters are first-time offenders who have clean records. Background checks can be very unreliable.
Two benefits come with anti-fraud measures such as HD surveillance systems. They can help employees and owners feel more secure about their team’s integrity.
“One survey of Fortune 500 companies reported that a harassment case cost the average large company $6.7 million each year from absenteeism, turnover and loss of productivity,” says Fernandes. “As our global customers can attest, HD surveillance is not only vital for security but also personal protection, and is a critical business tool for profitability.”
The Society for Human Resource Management (SHRM), warns businesses experiencing increased profits due to recent economic growth. Increased growth can cause employees to be more dishonest and lead to greater employee misconduct.
A SHRM study found that 42 percent of companies experienced problems in 2011 due to poor ethics. This is up from 35% in 2009 and 35 percent in 2009. SHRM’s experts predicted a rise in employee misconduct after examining the survey, which included trustworthiness of managers, accountability levels, and sexual harassment.