Spotting The Red Flags: How To Identify & Prevent Fraudulent Activities

Spotting The Red Flags: How To Identify & Prevent Fraudulent Activities

Do you know how to spot the warning signs that someone might be committing fraud? Identifying fraud and preventing those activities in the first place is extremely difficult. Having your finger on the pulse of your financial statements is key to combatting these scenarios whenever possible. Financial institutions will only do so much when it comes to fraud prevention. 

Here are the red flags you should look out for if you’re worried about identity fraud: 

Missing Documents

Do you find that some of your key financial documents are missing when they matter most? If they had sensitive financial information on them, it should send up a red flag that you are at a greater fraud risk. Someone could have made off with those papers and accessed that sensitive data. One missing piece of paper may not be a huge deal, but a pattern of missing documents is cause for concern. 

Multiple Payments

Do your accounts look incorrect? Maybe you noticed that you have issued the same payments several times to multiple accounts. This is one of the clearest indicators of possible fraudulent activity. The multiple payments just might have been an accounting mistake but you should definitely look into the person responsible for it. 

Invoice Volume Increases

Have you noticed that your accounts receivable seem to be growing even as your business level stays the same? When your payments to vendors don’t line up with an increase on your income statements, then it might be time to consider that these payments aren’t genuine. Data security will only get you so far. 

Perform a risk analysis to see where your money is going and stop identity theft in its tracks by putting a pause on the organization’s assets until you can do a full review. 

Common Complaints From Employees and Customers

One common red flag is consistent complaints about a person, department, or even the quality of your product. For example, an employee might have reason to believe that another employee’s lifestyle isn’t congruent with their salary. Take note, and consider whether this could be the result of fraudulent behaviour. 

Likewise, a decrease in product quality and constant complaints from your customers could be a sign of an employee cutting corners and pocketing the extra money instead. When costs stay the same but quality does not, it’s time to start asking hard questions to prevent fraud. 

Prevent Fraud With Brodsky Amy & Gould

You can prevent fraud and handle identity theft swiftly at the first sign of fraudulent activities. The above red flags should help you maintain more control over your company. 

If something slips past you, you may need a fraud lawyer in Winnipeg. Brodsky Amy & Gould can help you put a stop to fraudulent activity starting right now.