Strategies to protect your business from internal fraud and embezzlement

Fraud and embezzlement can devastate a business financially and damage its reputation. Being proactive by implementing internal controls and regularly monitoring financial activities can save significant time, money, and headaches in the future.

As business owner, your primary focus is growing the company, managing teams, and serving customers. However, a hidden threat exists that can significantly impact your hard-earned success: employee fraud and embezzlement.

According to the Association of Certified Fraud Examiners’ (ACFE) 2024 Report to the Nations, the typical business loses approximately 5% of its annual revenues to fraud. For many small to medium-sized businesses, these losses can be catastrophic.

Protect your company's bottom line, avoid falling victim to employee fraud, and build your customers’ — and stakeholders’ — trust with the following strategies.

Understand the risks

The 2024 ACFE report highlights several surprising and alarming facts:

• Median loss per incident. Businesses experience a median loss of $120,000 per fraud incident, and many suffer multiple incidents before detection.
• Duration of fraud schemes. On average, fraudulent activities go undetected for about 16 months, demonstrating significant gaps in internal controls.