Guide to Preventing Workplace Fraud - Chubb Group of Insurance ...

Fraud reporting programs. Have a program for facilitating the reporting of
suspected fraud by employees and others.
Fraud awareness programs. Include training employees, and even vendors,
in the fraud risks that threaten your business. This training should focus on
identifying warning signs (“red flags”) of potential fraud.
Fraud deterrence programs. Create a “perception of detection.” A
reputation for aggressively investigating indications of fraud can have a
strong deterrent effect. On the other hand, a reputation for ignoring possible
fraud may prove to be an invitation for perpetrators.
Effective follow-up and/or investigation. Establishing written policies and
procedures, and assigning responsibility for implementing them, for followup
and/or investigation when “red flags” are noted, policy and procedure
violations occur, and allegations of improprieties surface is critical to ensure
that investigation and remediation occurs.
“Zero-tolerance” fraud policy. One fraud deterrence strategy is to
announce, communicate, and enforce a “zero-tolerance” fraud policy.
Cooperation with prosecution efforts. In the event of fraud, execute all
required affidavits of forgery, provide requested documentation, make
company staff available as a witnesses, etc. It is important that a company
consistently demonstrate its commitment to a zero-tolerance policy with
support for prosecution of any person found to have been engaged in
fraudulent activity.
Internal audit/internal investigative units. Internal audit and/or internal
investigative units are mechanisms for companies to monitor and look for
violations of corporate policy and breakdowns in internal control.
Companies should evaluate whether to establish these units separately or to
combine them.
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