Ten Ways to Prevent Fraudfor small businesses

1. Mail bank

statement to

owner

Someone other than

the bookkeeper

should open the

bank statements

2. Review vendor list

Someone other than

the payables

bookkeeper should

review the

vendor list

3. Control credit memos

Receivables personnel can

steal payments and reduce

customer account balances

4. Control the

opening of mail

Don’t allow

bookkeeper to

open mail

5. Don’t put the

bookkeeper on

the bank

signature card

The business owner

should sign checks;

don’t use signature

stamps

6. Have the owner

sign off on journal

entries

The bookkeeper

should not be the

only person seeing

the journal entries

7. Perform

background

checks for new

employees

Call the prior

employer; perform

criminal and credit

checks

8. Provide an anonymous

means to communicate fraud

Advise your employees that they

can provide information about

fraud in a suggestion box

9. Require

vacations

Have someone

perform the

vacationing person’s

duties

10. Get Fidelity Bond

If all else fails, have

sufficient insurance to

cover employee theft