Setting Up Your Company’s Fraud Hotline

Study after study proves the effectiveness of a fraud hotline at uncovering and even preventing occupational fraud. Those closest to the employee committing fraud are much more likely to notice the red flags than upper management who have little interaction with them. Yet, those are the very people who may hesitate to turn in a colleague for fear that they may be wrong or for fear of retribution. That’s where confidential fraud hotlines are so useful. Learn how to set one up for your company with the tips below.

Easy steps

The first step is to meet with your legal advisor and members of your human resources and operations teams. Address any concerns they might have and secure their support before proceeding. It’s important to establish which department will fund the hotline and which individuals will investigate leads, work with law enforcement (if necessary) and communicate outcomes to stakeholders.

Next, select a hotline provider. Although some businesses manage their hotline internally, outsourcing the job provides certain advantages. Extracting useful information from reluctant callers generally is best handled by experienced operators. Using a third party can also help reassure tipsters of confidentiality. Most hotline providers offer secure online portals that make it easy for your company to manage and analyze tips submitted via the hotline.

When you’re ready to launch, make sure to strike the right tone. Explain to employees that this tool will help protect your company from financial losses and other negative outcomes such as bad publicity and poor morale that can affect everyone in the organization. Be sure to stress that the hotline isn’t to be used to report noncriminal activity, such as personality conflicts or disagreements. And explain how your company and the hotline provider are committed to protecting anonymity, to the extent it’s possible.

Raise awareness

Sometimes all it takes to stop fraud is a phone call — or even the possibility of one. Simply having a hotline can deter would-be fraudsters because of the increased risk that their actions would be reported. To ensure employees know about your hotline’s existence, post information in common spaces and have managers mention it whenever appropriate.

Contact us

Setting up a confidential fraud hotline is an important step in protecting your company from occupational fraud. For more information or other tips on preventing fraud, call us at 949-860-9902 or click here to contact us.

© 2018