Detecting Corporate Fraud Through Employee Tips & Referrals

Employees are your best weapon to stop fraud before it occurs

Posted by Joe Gerard in Code of Conduct, Corruption, Ethics, Ethics & Compliance, Fraud, Hotlines, Human Resources, Whistleblower on April 5th, 2010

Everyone wants honest employees who have beliefs and ethics similar to those of the company in order to create an ethical corporate culture. This includes the understanding that fraud and misconduct are not only undesirable, but that employees have a duty to report them to protect the company.

Read about i-Sight’s safe, reliable Ethics Hotline

When companies invest in reporting channels and internal measures to prevent workplace fraud, it becomes harder for employees to commit fraud, as they know that they are being watched and there are fewer chances for fraud to take place and escape notice. The weapon of choice when it comes to reporting issues of internal workplace fraud or misconduct is the anonymous hotline for employees, vendors, customers or anyone who has information.

The ACFE Report to the Nation

The ACFE Report to the Nation on Occupational Fraud and Abuse consistently shows that tips are the most common fraud detection source. The ACFE also finds that of the cases identified through hotline tips in particular, more than half of them are tips provided by employees of the company. The next largest group providing tips are company customers using hotlines.

Gathering Tips

It’s easy to see the importance of the role that employees play in the detection of fraud. Hotlines and other anonymous reporting tools are methods that make it easier for employees to communicate any fraud or misconduct that they encounter. Internal audits and internal controls are other important ways to detect fraud from within, as long as you have tools in place that allow these forms of internal detection to occur.

Case management software allows you to receive notifications of new cases or complaints made through multiple channels including your hotline, internal webform, or directly from employees. An internal or integrated hotline funnels new cases into your case management solution immediately. New cases are placed automatically into the queue where they can be reviewed by a manager and acted upon.

Some case management solutions also allow users to email cases directly into the system. Many teams that work outside of an investigative case management system use e-mail extensively. Those working on an investigation send e-mails into a shared folder. Here, messages are collected and reviewed before being acted upon.

A case management system such as i-Sight allows you to keep that process – you don’t even have to change the e-mail address being used. These e-mails get redirected to i-Sight and a new case is automatically generated.

Since i-Sight is web-based, users can also record new cases in a web form. This can take the form of a referral form that is place on a company’s intranet, website or portal. This simplifies the collection of both internal and external referrals and tips. All of these options are flexible and easy to implement in order to better manage incoming tips and the investigation process. i-Sight then makes it easier for your investigations team to manage cases, prioritize cases based on risk, identify repeat offenders and track trends based on the nature of the allegation.

  • Meet regulatory and legal guidelines
  • Improve communication across the enterprise
  • Centralize case information
  • Effectively manage milestones and key dates
  • Automate reminders and other alerts
  • Identify and understand trends
  • Accelerate the case resolution cycle time
  • Improve the ethics culture in the organization

Joe Gerard
Joe Gerard

CEO, i-Sight

Spend my days showing off the i-Sight investigative case management software and finding ways to help clients improve their investigations. Usually working with corporate security, HR & employee relations, compliance and legal teams.

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