Construction fraud costs companies thousands of dollars each year and can be a challenge to discover. As a contractor, you are constantly dealing with a variety of people and a long list of important deadlines. These circumstances can lead you to miss signs that fraud may be taking place. As mentioned in our series on the types of construction fraud, there are a number of subtle ways that fraudsters can take money from your company. If you discover fraud in your business, a Miami contractor attorney can inform you of your legal options. However, your best defense against fraud is to put measures in place to discourage it.
Below, our team of Miami contractor attorneys provide tips for preventing fraud in your workplace. For more tips for avoiding construction fraud, visit part one of this series. To learn about the types of construction fraud, visit our article on the topic.
Create an Employee Fraud Awareness Program
The best way to prevent fraud is to make sure that your employees understand your policies on fraud and know how to detect it. A fraud awareness program helps workers see the signs of fraud ahead of time. Employees should also understand the company’s stance on fraud and the measures the company will take if fraud is discovered. Additionally, employees should have the ability to anonymously report fraud.
Use Alternative Methods of Payment
Cash is difficult to track and can easily become the subject of fraud. Consider using prepaid cards for transactions. When prepaid cards are used the transaction is recorded immediately by the bank attached to the card. Also, you can limit the amount of money placed on prepaid cards to what is needed for purchases.
Conduct Random Audits
Periodically and without an announcement, you should review all internal systems to ensure that there aren’t any issues. All financial statements should be reviewed along with your inventory and other assets. Check to make sure you are in compliance with all workforce rules such as rules involving worker’s compensation insurance and certifications for subcontractors as well.
Disclaimer: The information contained in this article is for general educational information only. This information does not constitute legal advice, is not intended to constitute legal advice, nor should it be relied upon as legal advice for your specific factual pattern or situation.