By Laura Haight
If you are in business, there's a extraordinarily good chance that you have been hacked, cracked or defrauded.
Fraud is a fairly broad term that can include technology breaches and data theft as well as embezzlement and theft by an employee or contractor. According to the Association of Certified Fraud Examiners, the typical organization loses 5 percent of its revenue to fraud each year.
For most businesses, the fraud goes undetected for an average of 18 months. Wonder why you don't hear more about this? Because a large number of private businesses don't report their losses publicly. This is especially true of startups and nonprofits that survive on the trust and confidence of donors and investors.
You aren't helpless against these attacks. But protecting yourself requires preparedness and vigilance. First, conduct a full and honest evaluation of the security of your technology systems and the status of your internal financial controls. Based on what you find, fix the holes you have and establish new procedures for the areas you didn't have covered at all. Make training your employees a critical part of this step so they understand how important new rules and processes are; and they can be key members in making them effective.
Part two is the hard part: Monitoring, remaining vigilant, performing periodic reviews. This part never ends, it's ongoing and, yes, can be time consuming.
Portfolio has joined forces with Greenville (SC) fraud accounting firm Wessel Accounting to offer a service called BizSafe. This service is a multi-tiered, scalable approach to protecting your business from internal and external threats. We start with the basic level of evaluating your current operation and outline areas requiring attention: from serious red flags to operational improvements.
if you are a small business, startups or nonprofit, you may be thinking you're immune to these problems. Why target me when they can get, well, Target? In fact, small businesses and nonprofits are the most vulnerable because they often run on tight budgets, lack the staff to divide responsibilities and often don't have dedicated or onsite IT staff. Not only are you most vulnerable, but also least able to survive a fraud incident where the average cost to a small business of under 100 employees in 2014 was $154,000, according to ACFE.
Learn more about your risks and how the BizSafe service can help. And, if you're near Greenville, SC, join us for a small group lunch and presentation on Jan. 15.