Prevent Fraud by Enforcing Strict Anti-fraud Policies

By Peter Goldmann President, FraudAware Hospitality | March 31, 2010

And-now is a good time to start getting serious about fighting fraud, because, according to the Association of Certified Fraud Examiners (ACFE), internal fraud alone (not counting such crimes as credit card fraud by guests and vendor scams that don't involve a hotel employee) robs up to 6% of gross revenue every year.

A special challenge for hotel industry security managers is the fact that hospitality properties generate enormous amounts of cash. Whether it's guests paying cash for rooms or restaurant and bar patrons paying for meals with cash, without strict controls on how that cash is handled...and by whom...there's no question that a significant chunk of it is going to end up in employees' pockets.

First Things First

Whether it's cash embezzlement... theft of inventory... an employee accepting vendor kickbacks or some other profit-draining fraud, there is no getting around the fact that formulating and enforcing an employee anti-fraud policy is step one in the challenge of preventing fraud.

After all, you can't expect dishonest employees to be deterred from stealing if the company doesn't take a "zero-tolerance" position toward employee theft.

According to accountant, Andrew Durant of BDO Stoy Hayward in London, "The aim of a corporate [anti-fraud] policy is to demonstrate to both employees and the outside world that the company is taking the threat of dishonesty, fraud, and theft seriously.

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