This is the fourth part in my series discussing corporate fraud. For more on this topic please read
Government Response to Corporate Fraud
Ultimately, all institutions should have a comprehensive fraud prevention program tailored to meet the needs of the organization. Fraud prevention programs should also include three prongs to make them healthy enough to deter fraud. These prongs are detection, investigation, and prevention. New advances in software programs can also assist in seeking out fraudulent practices and destroying them.
Whistleblower protections and training programs are another way to accomplish this task. Setting up a successful hotline and encouraging employees to speak out when they see or think they have discovered tool can serve as a valuable deterrent. Making everyone in the company well aware that this hotline exists will generally promote transparency. Training likewise assists by strengthening the corporate ethical culture and making managers more self-aware of fraudulent practices that could occur. Instilling fraud training into employees demonstrates a strong commitment to proper conduct and emphasizes the employee’s own role in the fraud prevention of the company. This training should not just be reserved for high level executives, but should also be made available to mid-level managers and even lower level employees. Great training programs for employees add layers of protection for protecting and preventing fraud and gives managers incentive to make sure fraud controls are being properly followed. Just as one bad apple can ruin a whole barrel, one bad manager can destroy an organization. Constant exposure to an embracing corporate environment with a central code of conduct can go a long way to weeding out the bad apples though.
In conclusion, fraud will continue to plague our society in the near and future. There are always those unscrupulous people who will strive to push the limits of the system in an attempt to steal as much as possible. However, a strong understanding of the issues will allow more companies to better safeguard themselves, which is ultimately better for consumers. Maybe someday we will solve the fraud problem, but substantial internal controls can go a long way to putting a company on the path to success.
"Sam is a wonderful, results-oriented and extremely knowledgeable and talented attorney, who really has 'heart' in working on behalf of his clients, and explains options in a straightforward, respectful manner. He has assisted us with great outcomes which have added to our quality of life. I would not hesitate to recommend Sam for his services as he is an ethical, personable and expert attorney in his field. You will likely not be disappointed with Sam's work ethic, approach and his efforts."
-Aileen Dwight, Licensed Clinical Social Worker & Psychotherapist
Last updated: June 3, 2023
Our best stuff: secrets, tax saving tools, and tax defense strategies from the braintrust at Brotman Law.
These ten big ideas will change the way you think about your taxes and your business.
Find the articles and videos you need to make the right tax decisions in the learning center.
It is not just about what we do, but who we are, why we do it, and how that benefits you.
Meet with us to outline your strategy. No further obligation, 100% money-back guarantee.
In “The Car Dealer's Guide To CA Sales & Use Tax Audits - Part 3,” we discussed what happens after...
18 min read
In The Car Dealer's Guide to CA Sales & Use Tax Audits - Part 2, you learned what to expect if you...
20 min read
In “The Car Dealer's Guide To CA Sales & Use Tax Audits - Part 1,“ we discussed the CDTFA's history...
12 min read
We'll answer your most pressing tax law questions in 15 minutes. Please choose a time below that works best for you.
IRS Circular 230 Disclosure: To ensure compliance with requirements imposed by the IRS, I must inform you that any U.S. federal tax advice contained in this website is not intended or written to be used, and cannot be used, for the purpose of (i) avoiding penalties under the Internal Revenue Code or (ii) promoting, marketing or recommending to another party any transaction or matter contained in this website.