Each year the Association of Certified Fraud Examiners (ACFE) issues their “Report to the Nations”. If you’ve never read it before you definitely need to take a look. There is no more timely or insightful guide to the current state of fraud and white collar crime than this.
And don’t think that white collar crime is only a “big business problem.” For small businesses the risk of fraud remains high. Limited staff and fewer internal controls make it easier for simple schemes to go unnoticed. (I’ve seen this firsthand where even fairly brazen thefts go on for years simply because no one was looking.) The report consistently shows that even smaller organizations suffer significantly when fraud occurs.
Law firms can also benefit from the report. Whether advising clients, conducting due diligence, or handling disputes, understanding common fraud schemes and red flags can strengthen both prevention and case strategy. An don’t forget that law firms themselves are also small businesses . . . and face similar risks.
The bottom line: Even basic controls like segregation of duties, rudimentary IT security, bank activity reviews, and approval of time sheets can significantly reduce fraud risk.
Take a look at the report today. If you work in the business or legal world you’ll be glad you did.