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Effective Fraud Detection Tips According to

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Effective Fraud Detection Tips According to

August 15
08:18 2020
Effective Fraud Detection Tips According to

Fraud, no matter if it occurs because of Ponzi scams, lying on financial reports, or employee theft, is growing significantly. It is reaching alarming proportions and not without its costs. Government agencies and businesses around the world are suffering from misused or lost funds, irreversible damage, and diminished value of a company’s reputation, along with reduced customer trust.

When this happens, it is important to take the right steps to minimize the possibility of fraud. A good first step is to visit this website. Some tips to help with this can be found here.

Create a Profile of Possible Frauds

It is a good idea to use a top-down approach to risk assessment. List the areas where fraud is probably going to occur in a business and then determine the types of fraud that may occur. The next step is to qualify the risk based on the organization’s overall exposure. Try to stay focused on risks with the greatest chance of reducing shareholder value. That would be the ones that affect the extended supply chain, according to

Create fraud risk profiles as a part of the overall risk assessment, and make sure to include the needed decision makers and stakeholders. While this may not result in making friends in the organization by doing this alone, it is an important step to take.

Test All Transactional Data for Potential Fraud Indicators

With recent news, like fraud detection startup Ravelin secures $20M Series C, it is clear that fraud protection is a hot topic. It also means that it is necessary to test 100% of the data, rather than just random samples. Even though sampling can be effective for finding issues that are consistent through the data populations, this is not the case for all types of fraud. By nature, fraudulent transactions don’t occur randomly.

Some transactions may fall within the boundaries of specific standard testing and won’t be flagged. Also, if the sampling method is used, it may not be possible to quantify the impact of control failures, and it may not be possible to estimate for some populations. It may also be possible to miss smaller anomalies and, in some cases, it is these small anomalies that will add up as time passes and result in larger fraud instances, according to Sift.

Engage in Ongoing Monitoring and Auditing

Strengthen the controls over various transaction authorizations and be sure to use ongoing monitoring and auditing to effectively test and validate the controls you have in place. Continuous or repetitive analysis for fraud detection requires creating scripts that run against these larger volumes of data for identifying anomalies that occur over time.

When it comes to fraud, a business cannot rest on their laurels. Now is the time to take action, prevent fraud, and ensure that an ongoing plan is in place to help ensure the situation doesn’t get out of hand. Being informed and knowing what to do are the best ways to ensure that the desired results are achieved.

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