By Glen Moulton, Sole Proprietor of The Fraud Triangle Forensic Services
The essence of successful planning is not detail but flexibility. This is as true of fraud prevention plans as it is of complicated battle plans. The simple reason is that the enemy, the fraudster, is human too and we cannot predict with any confidence what his precise actions will be. But we can, if we understand his motives and environment, predict a possible range of actions and identify the tools and techniques we may need in order to respond to each of these actions.
This understanding is achieved by training staff to recognise the fraudster’s motives and environment. Yet, a lack of training with regard to fraud is one of the biggest deficiencies in most South African organisations. And, this problem is not unique to South African organisations and this is demonstrated by the following extract from the 2001 annual report of the ‘Fraud Advisory Panel’ of the Institute of Chartered Accountants in England & Wales.
“The development of a corporate anti-fraud culture requires serious and sustained training. Yet little progress in the marketplace can be reported since the Panel’s 1999 survey which revealed serious deficiencies in the programmes run by business, educational institutions and the professions.”
The simple fact is that people cannot recognise and react to what they do not understand and if they do not recognise the signs of fraud they will not be able to do their part in protecting the organisation against it. This is the true value of fraud training.
The good news is that, in the most recent Ernst & Young fraud survey, 60% of respondents indicated that they had provided their staff with fraud awareness training and over 50% had done so within the last year. This is a significant improvement from the 30% reported in the previous survey. The message is getting through but there is a long way to go because 40 % of respondents are still not providing training.
Finally, the emphasis is on “regular” fraud training. We all know how quickly we forget what we heard at the last conference. Reinforcement is the key to retention and is necessary if the training is to have the desired effect.