Chuck Whitlock

You might be surprised to hear that, on average, seven percent of annual revenues are lost to employee theft or fraud today. In a 2012 report by the Association of Certified Fraud Examiners, they revealed that US employees steal about $50 million per year from their employers, with nearly one-third of all company bankruptcies caused by dishonest employees. Chuck Whitlock, a noted fraud expert and author of Scam School and Easy Money, encourages employers in every field and industry to look closely at the areas of their business that are at risk for fraud and then employ strategies to prevent fraud as quickly as they can.

  Common Risk Factors

You might think you’re immune to this problem because your business isn’t in the financial sector, or because you don’t deal with sensitive client information. Sadly, that’s not a safe assumption. Chuck Whitlock notes that any business is susceptible to fraud, and that there are three main risk factors that make you more likely to be a victim of employee fraud in particular. The first is motivation on the part of the scammer, such as an employee with financial troubles, substance abuse problems, or a reason to dislike you. The second risk factor is opportunity. An employee has to have access to company money, products, sensitive information, or something else that has value. The third risk factor is related to psychology. Employees that rationalize their actions a lot are more likely to try to justify their actions, like trying to convince themselves the money is just a loan, or that the company has enough money that it won’t miss what they steal.

  Effective Prevention Strategies

If you want to put your company in the best position to counter employee fraud, you have to implement policies that both discourage people from attempting fraud and successfully prevent fraud when someone does try it. How do you do that? To start with, you need to inform every employee and any new hires that your business will not tolerate any kind of theft or fraud, and be specific about what that means. It’s also important to describe what the company will do if any such incidents take place. Even with that, someone might get it in their head to try, which is why you should have very detailed and up-to-date recordkeeping for both incoming and outgoing funds. In addition, set up a notification system whenever there’s a high-dollar purchase made, inventory is short, or a purchase order hasn’t been filled out. Chuck Whitlock advises employers to establish a system of checks and balances that includes cross-training employees. Engage in surprise audits so that employees know their work might be checked at any time. Other possibilities include always-on security cameras, arranging shifts so that no single employee is ever alone, and building a positive relationship with your staff.

  About Chuck Whitlock

Chuck Whitlock has written a number of books on white-collar crime: Scam School, Easy Money, and MediScams. He developed his expertise on the subject of fraud and the psychology of those who perpetrate it while he was working as an investigative reporter for television. Through keynote speeches, workshops, and other speaking engagements, he continues to inform the public and organizations such as the American Bankers Association, the Better Business Bureau, and the FBI.

  Sources:

http://www.businessnewsdaily.com/3959-protect-against-employee-theft-fraud.html

http://naforensics.com/wp-content/uploads/2010/10/Are-You-A-Target-For-Employee-Fraud.pdf

http://www.facilitiesnet.com/facilitiesmanagement/article/Three-Risk-Factors-That-Increase-Employee-Fraud--10923#

Social media has become a wonderful place to share and interact with friends and others who share your interests, but according to noted Internet fraud expert Chuck Whitlock, social media remains a priority target for scammers searching for people to victimize. With the rise in popularity of the Internet, and social media in particular, you’re likely to find scammers through email, Facebook, Twitter, Google Plus, and more. A good rule of thumb is not to post anything on one of these social media sites that you wouldn’t be comfortable telling a complete stranger, because that’s what these scammers are. If they come upon your private information, they can use it for money scams, identity theft, and hacking attacks.

Facebook Friend Fraud

Believe it or not, Chuck Whitlock has pointed out that identity theft and identity fraud are still prevalent on social media sites today. One common example on Facebook is the scheme known as friend fraud, which occurs when a stranger illegally gains access to your social media account and sends messages to the friends in your contact list. By pretending to be you, this imposter can request money from your friends as a result of a fake emergency that left you without any money for transportation, for example. Because of people’s generosity and warm feelings toward you, they might send the money to a con artist. Be careful about telling others your login information, check your social media frequently, and be sure that if this happens to one of your friends, you call them first to make sure it’s really them.

  Twitter Hijack

If you’ve ever had an awkward night out or been part of a group that gossips, you know that having these private moments made public is incredibly embarrassing. Apparently, scammers recognize this too. By Tweeting or messaging you that an embarrassing picture or rumor has been made about you, from someone you know, scammers are hoping you’ll click the link to find out what’s going on. When you do it, scammers can hijack your account and send the same link to everyone in your contact list. This link often contains malware or malicious code that will harm the computer with viruses, which is why you should check with the person who supposedly sent the link. If it’s from someone you don’t even know, advises Chuck Whitlock, you should simply ignore it.

  Google Gift Phishing

Who wants a free gift? The answer is, everybody does. How cool would it be to receive free clothes or beverages or electronics for absolutely no reason? Chuck Whitlock says that the promise of a gift is one of the best methods for phishing scams, which are where scammers get contact information out of victims through manipulative and deceitful strategies. He adds, “Just remember that anytime someone offers you free gifts in exchange for your personal information, it’s exactly how it seems: too good to be true.” Phishing scammers can offer free brand name products and logos to obtain your data, which is often sold to identity thieves, hackers, or advertisers. It’s always wise to ignore anything that seems too good to be true. If you’re committed to the offer, check the brand’s official site to confirm the authenticity of any tempting offers.

  About Chuck Whitlock