Business Fraud Stats...Scary!

Business Fraud Stats from the National Federation of Independent Business and the FBI:

• In 2011 the FBI secured $2.4 billion in restitution for corporate fraud

• The same year, the FBI ordered $16.1 million in fines from corporate criminals
• The median loss in a fraudulent scheme for businesses of 100 employees or less is $190,000

Corporate fraud, or "white collar crime," is one type of business risk that almost every commercial organization can encounter, whether it is a large corporation, a farm, a school, a restaurant, a non-profit charity, a medical practice or a machine shop. This is because any business operation, large or small, involves the exchange of money for goods and services.

According to the Association of Certified Fraud Examiners (ACFE), small business owners tend to believe their company is not prone to business fraud. However, in a study the ACFE found that small businesses are actually at a greater risk of employee embezzlement simply because they have a higher level of trust in their staff. The result of that trust can unfortunately result in more opportunity and more temptation for those who have access to the financials.

There are a few key lessons we can learn from the ACFE business fraud study:

1. The first step in mitigating risk is to gain a full understanding of what can happen in the course of doing business.

2. The worst time to find out that you need coverage for a problem is after the incident has occurred.

A Bramlett Business Risk Specialist can work with you to help you evaluate your business risk and help reduce your exposure. For more information, call (580) 223-7300.

(from trustedchoice.com, business insurance)

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