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You need luck to uncover fraud, but a bit of skill helps, too

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in Human Resources

While most workplace financial fraud is discovered by chance, it still pays to institute controls that can identify such scams.

A new PricewaterhouseCoopers study of 3,600 employers found that 45 percent of respondents had detected incidents of fraud. While internal auditing identified 26 percent of the scams, more than 33 percent were discovered simply by chance, such as when a co-worker pointed the finger.

Advice: Establish systems that make it easy for employees to anonymously report in-house fraud, such as confidential hotlines. Three other tips:

1. Offer rewards for tips that result in uncovered fraud.

2. Require anyone who handles finances to cross-train someone else in his or her duties. That way, no single employee is the only one who "understands" how the books are kept.

3. Insist that all employees who have access to cash and assets take at least some time off every year. Many embezzlers are reliable employees who never miss a day because they fear accidental discovery of their misdeeds.

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