Fraud and Your Business: Protect Yourself

After benefiting from the help of a forensic accountant, and some very credible financial blogs, Ted Hansen now shares his thoughts and experiences about managing finances. He hopes to enrich the lives of his readers with ideas on how to secure their businesses and families through his passion for writing. He has an MBA in Marketing from Leeds Trinity University.

Can you afford to lose $155,000 this year? According to the Association of Certified Fraud Examiners, companies who have less than 100 employees average that loss every year. If small businesses are losing this kind of money, then larger companies, and individuals are at risk for more than previously thought. Protect yourself by following a few basic methods of security.

Accounts, Cyber-Security, And People

Mind the source. Your credit cards and bank accounts are at the most risk. Separate your personal accounts (credit cards and bank accounts) from your business accounts. If a fraudster gets ahold of your information, then he cannot take all your money. Better organization gives you more power, not just over your own affairs, but over possibility of theft. Being more organized will let you become aware of more tax deductions, thus even saving you money.

Keep close tabs on your transactions. You can do this by practicing a little forensic accounting. For instance, Forths Forensic Accountants dig out the records of your transactions, bank and credit card. Go through each transaction, and see if you can account for every purchase or payment. You may be surprised by what you find. This little exercise will motivate you to keep stricter tabs on where every dollar goes. You may carry out the activity yourself or go for help to a consultant.

Use One Computer to Bank

Dedicate one computer to all online transactions; making sure it is not used for any other kind of web surfing. Because it will not be used for email, or social media it’s harder for fraudsters to get sensitive information. “The 2011 Business Banking Trust Study showed that 56% of businesses experienced payment fraud, or an attempt at fraud, in the 12 months preceding April 2011; 75% experienced account takeover and fraud online” (Devaney, Stein, 2012). The experts also tell us that for now, mobile banking should be avoided.

Secure The Computers

Firewall, anti-virus, malware protections, frequent password changes, back up everything; you’ve heard all this before. Good. Do it. provides some valuable information for protecting your IT infrastructure. Automate your back ups, and consider using a third party or off site service are just a few of the options available. Cloud back ups are growing in popularity and function, as well.

Train Your People

Let your employees know that the threats are real, online and off. If they know what to look out for, they are bound to see it when it comes. They handle sensitive information frequently throughout a given workday. They need to know how to handle it, dispose of it, and what the consequences are should they handle it carelessly.

Background Checks

To put it simply – use them. The first step to preventing fraud by an employee is to make the right hiring decision. The hiring decision can be an overly tough one to make. Sometimes it feels like you’re just throwing the dice. Whichever number comes up gets hired. Gain more control by conducting a background check. This will help you feel more confident in your hiring decision, and give you power over the toss up.


Deloitte (2013) has a three step approach to investigate fraud, should you find yourself in that situation. Step one is to secure and collect all tangible and oral evidence consistent with the rules of evidence (i.e. don’t tamper, or plant) to ensure admissibility. Second, analyze the evidence. Get yourself a clear picture based on the facts. Finally, present the evidence in an understandable manner in a venue of the client’s choosing.

Legal matters are more delicate than virtually anything you’ve handled before. Make sure to do it right, and stay on the preventative maintenance.                  


Beesley, C. (2013, May 8). 7 Ways to Protect Your Small Business from Fraud and Cybercrime | Retrieved November 1, 2013, from

Deloitte | Fraud, investigating fraud, corporate fraud, forensic accounting, computer forensics, Deloitte, Canada, dispute. (2013). Retrieved November 1, 2013, from

Devaney, T., & Stein, T. (2012, December 17). CapitalOneSparkVoice: 5 Ways Small Businesses Can Protect Against Cybercrime – Forbes. Retrieved November 1, 2013, from

3 thoughts on “Fraud and Your Business: Protect Yourself

  1. A few essential internal controls can easily prevent fraud in a small company. These tips are all useful for online fraud and there’s another I’d like to suggest called the Four Eyes Principle. As per this rule, each sizeable financial transaction should have to go through two senior position holders who do not report to one another. This greatly lessens the risk of internal fraud.
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  2. Thanks for the tips! Today everything is possible with the hackers. So as much as possible just do business with realiable sites only. I was a victim of credit card fraud last year. Good thing we found it out early.

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