If you are hiring, especially for a position where the employee is going to have access to your accounts, you need to follow good pre-employment guidelines to avoid the risk of being open to fraud.
Here are a few questions to ask yourself…
Does your organisation:
• hold face to face interviews with all shortlisted potential employees?
• do reference checks by phone to referees?
• carry out police checks on potential employees before you make an offer?
• have a policy/procedure manual for all staff?
• require two or more signatories for all payments?
• have policies for checking accounts receivable and payable?
• have cash-handling policies in place?
• have a policy on reporting fraud to the police?
Here are some good pre-employment checks that will help you:
• get a written CV and check it for gaps and inconsistencies
• get an application form completed in advance of the interview and do background checks on the information provided
• interview in person and use at least two people, one to make good notes and the other to watch for body language and reactions
• have a list of questions, so you cover all points and ask consistent questions of the applicants
• drill down on answers to see if the applicant really is telling the truth e.g. ask how they would handle a certain situation - then ask for more detail
• talk to all referees and don’t call mobile phones, find the company landline, call and ask for the referee. It’s too easy to have anyone answer a mobile phone. Have a list of questions. Ask if they would re-employ the applicant and be wary of even the slightest hesitation. Be suspicious of applicants who do not want you to talk to their last employer. Have they been pushed out?
• consider getting a police vet done - you will need to get written permission, so you might want to include that on your job advert
• have written employment contracts… and you must keep a signed copy, plus a copy of any draft given to the employee to consider
Ensure you have policies in place to deter fraud – take away the opportunities to deter anyone that has the inclination to commit fraud.
Be aware that, in some cases, fraudsters could be highly trusted, long-term employees, who no-one would suspect, so make sure policies are followed by everyone, all the time. The policies are there for a reason, so make sure that they are adhered to.
Cash handling, creditor payments etc. should be prepared and approved by at least two people and both people should see the original material. Check bank account numbers as invoices can be doctored to insert a different bank number. Extra invoices can be created so the creditor gets paid, but so does the fraudster.
Carry out random checks - you could call the creditor to check on the invoice to ensure it's genuine.
If you suspect Fraud…
If you are suspicious, then do background checks to see what you can discover. Act quickly but stealthily, so evidence does not disappear.
If you think fraud has occurred, you must follow a full and fair investigation process. You do not want to be paying the fraudster damages for their hurt feelings because of a poor process.
EasyHR can help you prepare for interviewing and put employment policies into place to protect you. Call Tarryn on 027 530 1255 for a chat.
Tarryn has worked in HR for over 14 years and loves to solve problems. She is a self professed employment relations junkie! She lives in Auckland with her dedicated husband, tireless toddler and three special needs cats.