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For the majority of employees, it would be unthinkable to take more than a pen from a workplace; yet for others they see the opportunity to defraud their employer as too big a prospect to miss.
In this article we take a look at some of the bold employee frauds that have occurred recently in New Zealand, and we consider how organisations could have prevented them.
Recent examples of employee fraud
We begin our journey in Wellington where there was a case of an ex-Chief Information Officer at the Parliamentary Counsel Offices who redirected $55,000 of taxpayer money to his own bank account using a fraudulent invoice after he was laid off. The fraud was only discovered when the finance team noticed that the bank account and GST number differed from prior invoices.
Moving now to Palmerston, a man was jailed for accessing Waka Kotahi NZ Transport Agency systems and changing customer records when he worked there in 2018. Using information from the Transport Agency’s databases, the man created fake IDs in order to obtain $53,000 credit and attempted to gain another $98,000. One of the victims was piled with $26,000 of debt and suffered other flow-on effects such as a drop in his credit rating, cancellation of his pre-approval for a home loan, and difficulty finding employment.
And finally, over to Invercargill where a former Powernet employee was charged with fraudulently stealing $440,000 from the company. Powernet allege that the former project manager was using his personal business to invoice for work and then signing off on the invoices using his financial authority at Powernet.
All these examples combine to show how important it is for organisations to implement safeguards that protect their business from unsuitable employees and mitigate the risk of employee or internal fraud. After all, prevention is the best cure.
What can organisations do to protect themselves?
Some precautions that organisations can take include:
- Implementing robust workplace policies and procedures, e.g. requiring expenses over a certain amount to get sign-off by another employee, regular audits by third parties, and provision of an anonymous channel for whistleblowing.
- Regular training for employees about what internal fraud looks like, such as the red flags to look out for in their colleagues’ behaviour and to advise the channels open to them to report suspicious behaviour.
- Conducting thorough background screening on prospective new employees and ensuring there is continuous monitoring of staff throughout their tenure. Background screening helps organisations understand the integrity of the candidates they hire, along with identifying any past criminal or financial issues that may be a red flag for potential misdeeds if hired. Continuous monitoring on the other hand helps to ensure that employees continue to be suitable for the workplace and unlikely to commence fraudulent behaviour during their time at the organisation.
These precautions can all help organisations to protect their business from unsuitable employees and to mitigate the risk of employee fraud. Implementing such safeguards can save organisations significant money, time, and reputational damage in the long-term.
How can National Crime Check help?
National Crime Check is a leading provider of background checks in Australia and New Zealand. We offer market-leading technology to conduct thorough background checks on candidates prior to making an offer of employment and on a continuous basis.
After decades in the industry, National Crime Check has integrations with the most authoritative Australian and New Zealand government data sources to ensure screening results are accurate and timely. Contact us today to discuss your background screening needs and protect your organisation from potential employee or internal fraud.