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Business Insurance

Safeguarding Your Business: Essential Tips to Prevent Theft and Preserve Profits

By May 17, 2023June 20th, 2023No Comments

As a leader within your organization, establishing trust among your employees and business partners is crucial. However, it’s important to acknowledge that no organization is impervious to the threat of crime and fraud. The Association of Certified Fraud Examiners estimates that organizations worldwide lose approximately 5 percent of their annual revenue due to illegal activities. On average, it takes organizations 18 months to detect fraud, by which time substantial damage has often already occurred.

Regrettably, many organizations overlook the need for crime insurance, erroneously assuming they face little to no risk. While implementing robust internal controls should be a priority, crime insurance acts as a vital safeguard against the actions of dishonest individuals.

Several areas of a business’s operations can create opportunities for fraud or theft. Consider implementing the following measures:

Hiring and Employment Procedures: Ensure thorough background checks, including reference verification, are conducted for all prospective employees. Additionally, consider periodic background checks for employees being promoted or transferred to sensitive positions.

Internal Controls: Establish strong financial controls, such as maintaining a clear separation of duties. Regularly reconcile accounts by individuals not authorized to deposit, withdraw, or write checks.

Computer Systems Controls: Implement robust security measures for your computer systems. Enforce regular password changes and immediately revoke system access for inactive or terminated employees.

If you wish to conduct a comprehensive assessment of your organization’s risk of crime, we have a scorecard available to assist you.

By implementing these preventive measures, businesses can significantly reduce the risk of theft, fraud, and financial loss. Prioritizing security not only protects your organization’s assets but also safeguards your hard-earned profits.