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Companies should be more wary of fraud

Companies should be more wary of fraud

Internal fraud can be a problem for companies and businesses are being advised to carry out random checks on their employees to find out whether they have financial problems that could lead them into temptation.

Small businesses, such as contractor accountants, could be particularly vulnerable as they don’t have strict vetting procedures in place when hiring staff.

There was a 45% increase in internal fraud in 2009 according to the CIFAS. Theft of cash and fraudulently withdrawing money from customer accounts were amongst the crimes reported.

Neil Munroe, from Equifax, said that businesses should be proactive in terms of tracking where things are going.

Another type of fraud that has recently been uncovered cost a recruitment agency £50,000. Individuals purporting to be from a food processing company contacted the recruiter with details of a contract vacancy in Thailand. A suitable candidate responded and was offered the position.

However, the candidate and the individuals claiming to be from the food processing company were actually in league together. By the time the agency discovered the scam they had already paid the IT contractor.

Fraudsters can carry out this kind of fraud because recruitment agencies check out the company they are doing business with rather than specific individuals. As contractors can be paid up to £1,000 a day, victims of these frauds can suffer a significant loss of money.

To avoid becoming a victim, Marilyn Davidson from APSCo advises recruiters to double check that the person really does work for the company they say they work for. This is not always easy because generally recruiters don’t meet the people they are dealing with. All the arrangements are made remotely.

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Image: Hook, Line, Sinker by ToastyKen

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