Employee Frauds Prevention


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employee frauds preventionEmployee Frauds Prevention

An average small business loses about 5 per cent of its annual revenue to employee frauds every year — a minimum of $150,000. What’s more, the Association of Licensed Fraud Examiners’ 2016 International Fraud Examine demonstrates about 23 per cent of instances that triggered losses of $1 million or more. Clearly, in regards to securing your business against employee frauds and employee theft every bit counts.

in the course of my interaction with business owners, I realized that over 95% of them had problem with employees financial unfaithfulness. You will easily find employee fraud cases in stores with so many stocks and products like pharmaceutical stores. Fraud and theft by workers is a major issue.

Employee Frauds Prevention Case Study

employee fraud case studies

  1. Fraud case of double entry

On 1/27/2017, I noticed a fraud case of double entry in clients shop using Point of sales and I decided to term it as pos frauds. Every EMV-Compliant point of sale system has pos fraud detection, so with a little fraud detection techniques you can be able to uncover this kind of fraud.  Investigating this kind of fraud in a store without inventory management system and POS will be little difficult. Using the quickbooks POS the said staff simply credited and debited a customer’s account with same financial value as though the customer collected change for a purchase, Thus balancing the transaction while the money has been pocketed.

  1. Employee product theft.

Employee theft is one major type fraud suffered by so many business organizations in Nigeria. This happens so much in pharmaceutical shops and other shops with huge inventory level.

Employee theft case study:  Another client who owns a large pharmacy in Uyo, told me how her staff often steal her drugs so much that while the POS is reporting 20 packs, the physical counted quantity on the counter is 3 packs and none of the workers will own up to this employee theft case.

Fraud detection techniques and Business fraud prevention

Employee theft is a significant section of this problem, but you can find other essential factors that will threaten your business, as well. Here are eight ways you protect your business from fraud:

1. Use a POS and inventory management system to manage your stock:

Inventory management system will help you keep accurate track of stock movement, It will help you know the quantity of stocks that has been sold out and profit accrued if any, you will know the stocks expected to be remaining on counter or store, you will know the transaction records of each staff. And many more.

Inventory management system and pos can help you to easily know when and how a particular fraud had been committed and by who.

2. Provide Employees Separate Logins for employees on the pos

Our fraud risk assessment of different organization using pos shows that some of this firms allows free login and access into the system. If there are no separate logins for your point-of-sale system (POS), it could be difficult to identify the origin of fraud when a problem arises. To prevent that, allocate all employees their particular split up login recommendations and don’t let them to talk about these logins with each other. In this way, every deal is likely to be connected to a specific individual, restraining confusion.

As an included precaution, create the POS to automatically sign down when maybe not in use for a prolonged period of time. Doing this can force your employees to confirm themselves frequently and make your POS less at risk of unauthorized use.

3. Use an EMV-Compliant POS

To discourage pos fraud perpetration only use EMV-Compliant POS. To help mitigate charge card scam, the United Claims has adopted a fresh chip-based authentication technology called EMV, which means Europay, Mastercard and Charge — the developers of the global standard. While EMV presents more security to the client, the release of the device in the U.S. also represents a change in fraud liability. Instead of banks being responsible for fraudulent credit card transactions, vendors who decided not to enable EMV are now liable

4. Perform Regular Inventory Checks

Be watchful for red flags like disappearing product, voided transactions or misplaced items. Hold an accurate tally of what’s in your stock by performing standard and unscheduled product count and audits. By establishing these typical product checks, you can greater get a handle on irregularities and identify performance issues.

Precisely controlling your stock will certainly reduce waste and enhance employee Frauds Prevention.

5. Balance the Cash transactions daily.

Employee Frauds Prevention is possible if you enforce a plan that the cash transaction should be counted and balanced on a daily basis. The easiest way to achieve this is to put an activity in place that needs multiple employees to check each other’s work. This will lower human problem, as well as establish a process of accountability.

6. Anti shoplifting system and security tag label product

Employee Frauds Prevention can also be implemented developing and integrating magnetic detachers anti shop lifting system and security tag label on each individual products to prevent shop lifting by workers or customers.  It is comprehensive security solution for library, bookstore, Supermarket and pharmaceutical stores.

Iyou need help installing EMV-Compliant POS and integrating magnetic detachers anti shop lifting system call +2348140970926 or

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