The trouble starts with the fact that whenever anybody wants to steal money, they will try to do so without getting caught. Obvious this may be, but their ingenuity will lead to some pretty cunning scams that will trick people into losing their money. They will keep going, hidden from view, for a very long time and sometimes never be discovered. Therefore, as a hidden crime nobody knows how much is going on or in what way it is affecting them.
Those that think fraud is a problem for businesses are mistaken. Businesses keep society and the economy running. They provide jobs and wealth for many people. When a business fails the employees lose their jobs and often may have difficulty finding new employment. When a director runs a company fraudulently, burdening its trading activity by diverting profits to his own pocket, so that it eventually fails, it is not just the creditors and suppliers that lose out but many others as well.
It is interesting to note the converse of this where businesses are set up as scams in the first place, and the workers are willing participants. For example, support publishing companies that prey on small businesses and individuals providing worthless advertisements in useless publications rely on the willing participation of their workforce. The workers are paid gross. They are supposed to deal with their own tax obligations but never do. The business is a shell for tax fraud as well as deceiving its customers.
Many such companies approach individuals who find themselves in a position where they are repeatedly asked for payments for products that they do not really want, often believing they are supporting a good cause or charity and are reluctant to back out. The reality is that though they think they are paying for something real, they are being defrauded.
Many frauds exist in everyday life that people are ignorant to, yet they can have a huge impact on them. Some companies make it very hard for people to cancel payments for services they no longer want. By the time an individual has managed to find the correct department and adjust their arrangement, another months payment has been taken. Some companies will take an additional payment after a contract has been terminated and wait for the customer to complain. Apathy often means that customers will not bother trying to get a small payment back, but if thousands suffer the same problem the business might profit substantially.
Sharp business practice is all around us. Companies fail all the time causing hardship for many and then the fraudster will also attempt that direct attack. Nobody wants to be obsessed with protecting their money, but some simple precautions might save you from the impact of the criminals. For example, don't put all your eggs in one basket, check the credentials of those you deal with and be alert to the possibility that the fraudster is the seemingly genuine and generous person that wants to help you!
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Mark Jenner is an expert accountant and fruad specialist. He is a Fellow of the Institute of Chartered Accountants in England and Wales, a Certified Fraud Examiner and has a Masters Degree in Fraud Management. He advises business large and small on how to be secure from the fraudster =>http://www.mark-jenner.com
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