Fraud Prevention on a Budget: Expert Tips for Smaller Organisations

During International Fraud Awareness Week 2024, we asked our expert speakers a series of questions to get their insights Counter Fraud. This blog looks at what they think small organisations with limited budgest can do to effectively manage fraud prevention. Find out what the experts in the sector are thinking! 

Ruth Ray, Director of Data at CIFAS

Joining a data-sharing consortium means smaller firms can leverage insights from a much larger pool of risk data.

Philip Juhasz, Senior Counter Fraud Officer at Shared Anti-Fraud Service, Hertfordshire County Council

 

For smaller organisations with limited budgets or counter-fraud teams, understanding their fraud risks is crucial. This knowledge allows resources to be directed to the areas of the business with the highest fraud risks.
Fraud risk assessments facilitate this process, from an organisational level down to a detailed evaluation of specific functions or operations. These assessments not only identify fraud risks but also review existing controls and mitigation measures. This critical analysis highlights any limitations and weaknesses, enabling the effective use of limited budgets to strengthen controls where they are most needed.
 
Another effective strategy for smaller organisations to manage fraud prevention is consider sharing resources with other organisations. This collaboration can provide a more resilient and comprehensive counter fraud response.

 Joshua Reddaway, Director at National Audit Office

Counter-fraud strategies need to be proportionate to the risks. This is not really about the size or budget of the overall organisation. Small organisations with large risks should invest more in counter fraud to save themselves money, whereas it will not be worthwhile for large organisations with small risks to do so. But the key to this is understanding the risk and that will take some investment by all organisations. The Public Sector Fraud Authority is charged with supporting them to do so. 

 Lavinia Ferguson Dean, Membership Manager at NAFN

Organisations must seek wherever possible to collaborate. Sharing resources (staff/funds) will support effective management of fraud prevention and ensure that limited budgets are used effectively. Risk Assessment in addition to understanding the value of intelligence, will also support prevention. Effectively sharing intelligence, good practice and implementing the learning from larger organisations can be helpful. I should note that many small organisations can be the most innovative; therefore understanding the approach of similar sized organisations may also support effective fraud prevention. 

 Mark Button, Director, Centre for Counter Fraud Studies University of Portsmouth

 

By focusing upon the most effective fraud prevention tools to tackle fraud. 

 Neil Charnock, Deputy Director: FIS Professionalism at HMRC

- Know your employees well (including suitable screening at point of recruitment)
- Introduce controls: Ensure there is no single point of failure with regards to financial authorisations/transactions- build-in a ‘multi-layer’ approval system to ensure more than one person has oversight of what’s being approved or spent. Use a suitable system to track all financial transactions.
- Regularly review business account activity and question ay potential irregularity.
- Audit high-risk areas often (such as cash, returns, inventory management).
- Improve awareness of and prevention against fraud across your workforce via effective learning provision. Ensure your teams are equipped with the knowledge to identify and prevent fraud, and are actively encouraged to report suspicious behaviours of co-workers and/or customers.
- Don’t be complacent- if something appears not to add up, probe it until you have the answers and reassurance needed, or to confirm the concerns which can then be acted upon swiftly.

 Jeremy Asher, Director at Financial Fraud Awareness Campaign

Educating staff about fraud risk is vital. The government and banks do provide some training and free resources. Organisations need to learn about best practice, because even though the Fail to Prevent Fraud offence only makes large organisations liable for prosecution, all organisations should implement measures in order to help protect themselves from internal fraud. And all staff should be made aware of the 159 service whereby they can verify if it is their bank calling them.

Want to hear more insights from our expert speakers? Join us for the Counter Fraud Conference on 12th March, 2025 at the QEII Centre, London. Complimentary tickets are available for the public sector. View the latest agenda and register below.