FRAUD PREVENTION FROM EMPLOYEES

Fraud Prevention From Employees

Abstract

Many companies and organizations have faced an unnecessary high cost of operation because people have misappropriated the use of company's resources while most companies have considered their employees to be the assets necessary for profit. Larger organizations typically can afford the internal control checks and balances needed to deter many of the more significant fraud and embezzlement schemes. Small companies often have trusted key individuals but unfortunately, those organizations that can at least afford internal controls, have also, least afforded a major fraud. Companies have primarily devoted to survive insuring that the profit from the engaged activities.

Fraud Prevention from Employees

The problem

Organizations and companies are operating at higher-cost due to the abuse of resources by their employees. Many company are loosing money due to low productivity when employees falsify documents or abuse time. Some hourly employees have falsely claimed overtime earnings on their time sheets to gain extra income. This type of behavior is very wrong and unethical. In such cases, the employees gain a few extra dollars and increase the employer's liability in terms of taxes and other fees mandated by the government.

Hourly employees are often tempted to be unethical in this manner when there is minimal supervision of their activities. In these cases the employee or employees receive income without fair production in the interest of the company. This is a selfish practice on the part of the employee. Most companies consider their employees to be assets necessary for profit. Claiming time worked or income increases the overall liability, thus reducing profit. Companies are primarily devoted to survive insuring that the profit from the engaged activities.

Money and time is also lost when people abuse their benefits to take time off with pay. Many employees have taken time off from work for personal holidays. Most companies offer employees one to three paid personal holidays a year for individual paid time off. Personal holidays are treated as regular paid vacations and observed company paid holidays. Some employees have also abused personal holidays by taking more days of than required or not properly recording personal holiday hours on payroll records. Comp time is another type of paid time off offered by companies to their employees.

Rules governing comp time are not the same for all companies. It has also been acknowledged that comp time is improperly recorded on employee's time or payroll records. Another traditional benefit offered by companies is sick time. This can be time off with or without pay. Sick time guidelines are established by respective organizations with regards to the individual employee status. Government programs and Laws protecting employees such as FMLA (Family Medical Leave Act) and ADA (American Disability Act) have also been abused by people for time off work. Time off work means no individual production for the organization.

Companies must guarantee employees employment for a limited time when FMLA or ADA is used. Companies again suffer losses when these privileges are abuse ...