What is Fraud Management Training?
Fraud has been increasing in recent years, especially within the business world. If an employee or a business has been found guilty of fraud following investigation, the business will be subject to severe repercussions administered in alignment with the UK Fraud Act 2006. Therefore, if a company wants to achieve an anti-fraudulent culture within their business, it would be wise to conduct fraud management training to ensure the whole organisation is aware of the fraud prevention procedures which need to be installed.
Why should an organisation conduct fraud management training?
Fraud is on the rise, especially within the business sector, where more and more expanding companies are realising that fraudulent activity has been conducted in their business on behalf of some of their employees. If your organisation is not aware of the fraud that is occurring, there is a potential for the organisation to face severe repercussions.
According to research conducted by PwC, by February 2018 half of UK organisations have been a victim of fraud in the last two years. The most severe fraud offences which affected these UK organisations amounted to the loss of over £72,000. However, it is not just the financial aspects of a fraud offence which affects an organisation, but the reputation of the organisation, which can be sufficiently damaged for allowing fraud to occur. Furthermore, employee morale will drop as there is little attraction in working for an organisation whose reputation has been tarnished and is no longer viewed as an attractive business partner to other organisations.
It is important for those who are on the management board of an organisation to commit to an anti-fraud campaign, to ensure that employees are deterred from such activity. To create a culture which deters employees from fraud, fraud management training will be beneficial.
What will fraud management training teach you?
1) This training will offer all individuals a basic understanding of what fraud is, because although we assume we know what fraud is, the many different forms it can assume can be confusing.
2) This training will identify what specific activity an organisation needs to look out for amongst its employees. If you are aware of the red flags which will highlight potentially corrupt activity, then you will have a head start in preventing this activity from occurring.
3) This training will expose and explain why employees commit fraud. If an organisation is aware of the potential reasons an employee would commit fraud, then they can aim to prevent these reasons from existing.
4) If an organisation has demonstrated that they have conducted fraud management training, then the organisation as a whole will be aware that fraud is not tolerated in their environment. Moreover, a system of trust will be established with the collective goal to prevent fraudulent activity.
KPMG, a large professional service company, has a learning academy with courses which focus upon fraud awareness for their employees to ensure they are educated within fraud and what to look out for. To conduct training such as this, the KPMG management would have to be committed to this cause as well, and their own fraud management training would demonstrate this. In May 2014 KPMG published some documentation from their “Fraud Risk Management” which had the objective of “developing a strategy for prevention, detection and response”. This is a clear indication that KPMG have established an anti-fraud culture within the business, and this will certainly deter employees and associated persons from engaging in fraudulent activity.
If you wish for your organisation to have transparent and ethical business conduct, then you should utilise fraud management training in order to establish the desired business culture for your organisation. Employees and associated people will only comply and replicate the behaviour which is around them; therefore, an example needs to be set by the management team through a demonstration of their own training.