- Dean Smith
Business Insurance Clients Should Heed Warning: 20% Uptick in Fraud During the Holiday Season
According to an article on hometownquotes.com, the holidays can get REAL expensive for businesses and their insurers. Why? ACFE’S 2014 Report to the Nations on Occupational Fraud and Abuse highlights some statistics to include an approximated 5% loss in total revenue to fraud. Furthermore, the ACFE Vice Presidence and Program Director Bruce Dorris and Eric Feldman say, “Even worse, additional ACFE research indicates that fraud takes an estimate 20% uptick during the holiday season.”
Feel free to share these tips with your business clients:
1. Uphold hiring standards.
“Many small business owners have a detailed vetting process in place whenever they think about hiring a regular staffer. Adding temp employees around the holidays tends to get thought of as an afterthought. There’s this attitude that ‘we just need a warm body to keep us from falling behind.’ Unfortunately, as the statistics show, that warm body can be what causes a business to fall behind rather than increased demand. Advise your clients to stick with their established hiring procedures before bringing in additional help for the holidays, and if they don’t have a standard hiring procedure, advise them to get one. It may mean having to work harder with fewer people, but it can definitely be the difference between making and losing money.”
2. Utilize your existing staff
“If your small business clients have a reliable staff in place, then a better course of action for the holidays might be to put a premium on their time and shift more major responsibilities to the established team. For ‘heavy lifting’ work that just requires that aforementioned warm body, bring in temp help but make sure they don’t have position or responsibilities that might enable them to take advantage and commit fraud on the business. Ultimately, each business owner will have to know their business well enough to know how they can implement this, but it’s definitely worth consideration.”
3. Reevaluate insurance policies against fraud
“Before the busy shopping season, encourage small business clients to come in and sit down to reevaluate insurance needs. After all, they can’t be everywhere at once, and if they do by chance take a loss due to employee fraud, there could be some fallback lurking within their existing policy.”
Staying proactive is one of the best ways to combat fraud!