Toby Braun, Founder & Managing Partner, American Special Investigative Group.
Every year, businesses go to great lengths to protect their assets and investments. They implement advanced technology, offer competitive benefits and develop robust protection measures to shield their operations. Yet, despite these efforts, there’s a critical element I’ve found many companies overlook: their employees.
Fraud remains a persistent challenge, and it costs Americans billions annually. Companies invest significant resources into detection technologies and comprehensive compliance frameworks, but they sometimes miss a vital link in the chain: employee training and support. The reality is that underpaid, undervalued or undertrained employees present a significant fraud risk, both as potential perpetrators and as unwitting victims of scams.
The Human Element Of Fraud Prevention
While technology can flag suspicious activities, it cannot replace the human judgment needed to prevent fraud at its source. Employees are often the first line of defense, but if they aren’t equipped with the proper training, they become vulnerable to sophisticated scams or may even be tempted to exploit company vulnerabilities themselves.
Consider the risks of an unsatisfied or disgruntled workforce. When employees are disconnected from their company’s culture and values, they can be more susceptible to engaging in fraudulent behavior. Even more so, employees who lack ongoing education and training could be at greater risk of falling victim to scams that could expose their employers to severe financial losses.
A quick search on Instagram for “#newbadge” brings up more than 11,000 posts, many of which feature individuals proudly sharing photos of their work badges. These images often include sensitive details such as ID information, job titles, designs, photos, names and even barcodes. Are these posts shared with malicious intent? No, and that’s where the issue with fraud lies: It is frequently unintentional. A simple, well-meaning post celebrating a new job or accomplishment can provide enough information for an attacker to identify a potential target and perpetrate fraud against an organization.
This is where training becomes a vital shield against fraud. Comprehensive employee education is one of the most effective yet underused tools in combating risks. Beyond basic onboarding for new employees who celebrate a new job, companies should hold ongoing scenario-based training. This equips employees with the knowledge to recognize evolving threats and understand how their actions, like oversharing on social media, can create vulnerabilities. By empowering staff to identify and mitigate risks, companies can proactively protect themselves from potential losses, saving significant resources in the process.
Empowerment Through Investment
The solution is clear: Prioritize investment in your employees. When employees feel valued, supported and well-informed, they transform into committed stakeholders in their organization’s success. This level of commitment not only elevates morale and productivity but also fosters a workplace culture that is inherently resistant to fraud. People are less inclined to engage in dishonest behavior when they are treated fairly, compensated properly and see themselves as integral to the company’s mission.
Additionally, well-trained employees become vigilant defenders who can identify and report potential fraud before it escalates. Their continuous involvement in daily operations positions them as crucial assets in any comprehensive anti-fraud plan. Investing in employee education is not just a safeguard; it’s a catalyst for building a resilient, fraud-resistant organization across different departments.
Personally, I believe training and supporting employees isn’t just an HR initiative; it’s a financial strategy. By investing in continuous education and employee well-being, companies can prevent fraud at its roots, safeguarding their financial health and reputation. In the fight against corporate fraud, the most overlooked asset could be right under your nose: your people.
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