If you have opted for a blue-collar business and sticking high on the moral compass when it comes to the corporate venture least you can expect is fraud. However, rightly said, “you can’t expect everyone to be fair because you abide by fairness”, hence employee frauds are quite common and practise in employment verification,

verify professional references, employment screening, employee education verification, verifying criminal history, and verify employee court records among all. Yes, be sure about the character of the person who is being appointed along with the skill set.

What is worker verification?

Job verification is a request to a third party to establish your current or previous employment status. For instance, a govt agency may request an employee survey to validate a variety of facts such as your pay, current work status, job description, training or accomplishments, and working dates.

These inquiries for job information are sometimes part of a bigger background check to ensure that you are who you say you are and that the third party can keep carrying out a service or demand. Before opening a specific type of account or signing for a loan, a banker, for example, may need job verification. A recruiting business may also question your previous job performances, present job duties, wage records and reappoint eligibility.

Purpose of a worker verification

When it comes to recruiting and selecting the proper personnel to help your company thrive, employment verification may assist you in a number of ways. For starters, it allows you to employ competent applicants more rapidly – it expedites the whole process of bringing the right personnel on board. It also aids in ensuring that your candidate’s career history is correct, which may foster more confidence between the two sides. Employment verification helps you ensure that the candidate has the required skills and experience for the post and reduces the danger of hiring somebody with forged certificates.

So the major goal of employment verification is to ensure that there are no discrepancies between the information provided by a job application and their real employment record. It is a form of background check that allows you to be more comfortable in your recruiting decisions and create trust with a possible team member of your organisation.

What is employee fraud/ Blue-collar fraud?

Employee Fraud refers to any case in which an employee of the Company, its Subsidiaries, or License holders has committed fraud, as indicated by a joint finding of such fraud by the Managers or both the Industry’s and the Bank’s theft prevention teams concurring that the employee committed such fraud. Payroll fraud, one of the most prevalent kinds of employee fraud, occurs in 27% of organizations and leverages the company’s payroll system. According to 2018 research published by the Association of Certified Fraud Examiners, illicit behavior frequently stays undetected for an average of 30 months.

How common is employee fraud

According to corporate security experts, 25% to 40% of all workers steal from their companies. Employee theft costs businesses 5% of their annual income, according to the Association of Certified Fraud Examiners (ACFE). According to the ACFE’s 2014 Global Fraud Study, the average damage incurred by a single occurrence of fraud cases is almost $145,000. According to the survey, organisations with fewer than 100 employees experienced 28% greater fraud cases than bigger ones.

Best solutions to control employee fraud

• Get to know your employee

To avoid fraud, every firm seeks to hire honest and trustworthy staff. Conduct background checks on all personnel who handle payments or money. As their connection with the finance department becomes more intense, the emphasis should shift to the past and current financial position. Check references to check that potential workers’ qualifications are accurate. This provides you with a good opportunity to demonstrate integrity. Interact with new staff to get to know them better.

• Have different bookkeeping and accounting department

Many small businesses have a single accounting employee that handles all bookkeeping duties, such as processing client repayments, collections, invoice payments, pocket money administration, and putting them into the accounting system. As a result, fraud situations might easily go undiscovered.

Two or more accounting and bookkeeping personnel managing corporate financial activities and responsibilities alternately, on the other hand, might lessen the likelihood of fraud. Accounting and cash handling tasks can also be separated or outsourced.

• Get through an intense verification

There must be a clearly established process for investigating suspicious behaviour and/or financial data. The method may be defined ahead of time, allowing for a more fast and more efficient inquiry.

• Keep a hold on employee control

Even small organisations must establish and maintain internal controls to prevent and identify fraud. Restriction of access to the financial account data, stock access, establishing cross sign-off on expense reimbursements, overtime, all check writing functions, and other accounting or payroll functional areas, and going to perform an audit log review to ensure the integrity of the books are all part of this.

• Include your employees in controlling the fraud by training them

Employees in fraud-prone sectors of the organisation should be aware of the warning signs of fraud, as well as how to avoid fraud and report suspicious behaviour or activities by coworkers. Creating an anonymous reporting method or process might help put their minds at ease about informing their employers about a coworker. Management, particularly entrepreneurs, should develop an ethics code that clearly states that unethical behaviour will not be accepted.

• Take assistance from computer security measures

Learn about your computer systems and software, as well as how they might be exploited to redirect money or goods. Restriction of computer terminal and record access Change entrance codes on a regular basis and verify to ensure that security protocols are followed.

• Enhance the security of credit card

Credit card fraud has been in the news so frequently that some consumers may have gotten numb to it. However, enterprises of all kinds, including the tiniest home-based venture, should begin by clearly segregating company and personal accounts. The mixing of company and personal assets is not only susceptible to costly blunders, but it may also expose the individual to lost monies on both sides if credit card data is compromised. Separating accounts also makes it much easier to track corporate spending. Companies should be cautious about who they provide their credit card information to, and they should use safe, bill payment systems wherever feasible to reduce the risk of check theft or fraud.

Conclusion

Keeping the rising fraud into consideration along with the kind of negative impact it can have on the organization, it is necessary to go for employee verification. This process will not only make you assured of your decision but will also assist in managing human resources, finances, and legal burdens. Thus, it is vital to hire a renowned and skilled employee verification company. Get a full hold on your manpower and employee strength with this simple step, and let your business have a strong foundation.
Ratifys is mainly used for professional services to empower the employer ecosystem and network, and it allows companies to verify and rate their employees. Ratifys allows employers to create profiles and “connect” to each other (employers) on a global platform that may represent real-world professional relationships.