Billboard Insider wrote a post last week discussing how to protect your out of home company from employee fraud.  Readers of that post called our attention to some new employee frauds.

• An employee, who paid an out of home company’s power bills, slipped her personal power bills into the bundle along with the power bills for all the company’s signs.  The scheme worked because the same power company served her home and the company’s signs.
• A sales rep for a North Dakota out of home advertising company traded ad space for personal products and services totaling $63,000.  The scam wasn’t uncovered until the out of home company was sold.

Here are the ways to protect your out of home company from employee frauds.

• Have your financial statements reviewed each year by a quality CPA.  To have an outside set of eyes looking at your results can be very helpful. A good CPA can ask the right questions that may help to uncover potential problems..
• Write checks yourself and originate wires and eft’s yourself.  This works for a small company but may not be feasible for a larger company.
• Review accounts receivable credits, refunds and adjustments for suspicious activity.
• Approve all trades for advertising yourself.  If your company is too big, require your controller and sales manager to approve all trades of services or goods for advertising and review that list monthly.
• Require each employee to take at least two consecutive weeks off each year.  Frauds fall apart when someone isn’t in the office to keep the fraud covered up.
• Have one employee make deposits and another employee handle the accounting.  Also require two signatures or two approvals for a transaction over a certain amount.  It’s hard to hide a fraud when multiple people are involved.
• Periodically ask to see all of the checks and eft’s which your company writes or originates each month.  An unscrupulous employee will be less likely to try something if they know you occasionally check.
• Know who you hire.  Call references.  Check pictures against ID’s and search online databases to avoid hiring someone with a stolen identity.

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