Deloitte and Touche fights fraud with free tip off service
According to Jens Kock, Partner Risk Advisory Services, at Deloitte and Touche, early detection of fraudulent activities can protect companies from huge financial losses.
Kock said, occupational fraud is more likely to be detected through a tip-off and therefore it is important that company management and staff be able to identify various types of fraud and to have a means to report this so as to minimize the effect of fraud on the business bottom line.
He further said that occupational fraud falls mainly into three primary categories, the most common of which are asset misappropriation schemes whereby an employee steals or misuses an organisation’s resources such as theft of cash and false billing schemes.
“The second type of occupational fraud is corruption which can best be described as “an employee misusing his/her influence in a business transaction in a way that violates his/her duty to the employer in order to gain a direct or indirect benefit,” he added.
He also stated financial statement fraud schemes which are also part of occupational fraud and are schemes through which employees may intentionally cause misstatements or omissions of material information in the organisation’s financial reports, such as recording fictitious revenues, understating reported expenses or artificially inflating reported assets.
“As a vital component of broader ethics and fraud risk management programmes, Tip-offs creates a mechanism for early detection and serves as a deterrent measure, as it fosters an ethical culture within an organisation, provides a means for employees to raise ethics and compliance issues and can put a stop to unnecessary financial loss.”