‘Screen workers to reduce fraud’

yesterday.
Ms Reid said companies were exposed to fraud risk to the extent that they recruit employees, engage temporary employees, outsourced labour and suppliers.

In the case of employees, she noted that research carried out in South Africa showed that 6 percent of employees had a criminal record, 20 percent had bad credit report, 13 percent had invalid driver’s licences, 14 percent had fraudulent Matric certificates and  22 percent had fraudulent tertiary qualifications.
Poor fraud prevention results in an “insider job” type of vendor fraud where current or former employees with knowledge of the firm’s internal controls use that information to perpetrate fraud without being detected.

This highlights the high levels of security risk that the majority of companies are exposed to, she said.
“To minimise such risk there is need for firms to beef up their systems and procedures, particularly in respect of verification of documents, database interrogation, annual verification, allowing for annual leave of staff and ongoing integrity testing,” she said.
Ms Reid said effective fraud prevention required organisation-wide buy-in especially from company executives, human resources, procurement, and risk/loss control departments.

She added that there was need to improve screening of the company’s other external engagements such as suppliers in order to reduce vendor fraud.
The Securitex conference, which was organised by security firm Reclaim Security (Pvt) Ltd, saw issues ranging from investment banking strategy, enterprise risk, fraud examination, actuarial determinations and environmental impact assessment being discussed.

Securitex chairman Mr Ethan Mathibela said in respect of their outlook they were looking to increase their awareness activity of risk and fraud issues in the country.
“Our work in the year ahead will focus on quality of service enforcement, state of preparedness, corporate governance issues, information technology and cyber crime, public awareness campaigns, enterprise wide risk management issues, securities exchange and regulations in the telecommunications, securities, energy and mining sectors.

“We will intensify our educative efforts on the issues of risk and disaster management through the print, electronic media and social networking sites,” he said.