Previously on Game of Fraud we introduced the role of the CFO in adapting their defenses to face new and more aggressive forms of fraud and fraudsters who are better organized and more technically proficient than ever. And we answered the first of three questions that CFOs should be asking themselves about what exactly are the threats and what risks they represent, and what are the best human, organizational, and technological practices implement to mitigate, even prevent, fraud?
In Episode 3 we answer the next two questions CFOs should ask themselves:
Why invest in fraud prevention?
Beyond the understandable peace of mind that security brings and assurance that the company will not (or will no longer) become the victim of attempted or successful fraud, security for processes represents a competitive advantage due to its reinforcement of the company’s reputation for reliability, reassurance for commercial partners, and more.
What are the most effective tools to mitigate, even prevent, fraud?
The most advanced technologies in this battle are big data, machine learning and digitization. Big data enables handling vast volumes of information, often in real-time. Machine learning is a component of artificial intelligence in its broader meaning, seeking to create and use algorithms to obtain predictive analysis based on data. Together, they make it possible for the company to go even further, such as risk scoring its clients and suppliers.
Digitization, or automation, technologies that leverage A.I. are the other essential tool and an important part of any effort to mitigate risks. By creating and organizing a rigorous process that includes complete traceability and security found in Cloud technology, these solutions become extremely effective in fighting fraud.
But even by leveraging advanced technologies, raising employee awareness is one of the most important aspects of fraud prevention. Providing training to all departments and every hierarchical level within the company, including top management, is important so everyone knows the role they play in identifying warning signs and exposing potential fraud.
It is also important to implement communications that are adapted to each different stakeholder group within the company that reflect the company’s commitment to fraud prevention and identifies the consequences of not taking fraud prevention seriously as well as the benefits of executing well-defined fraud prevention plans and practices.
Preview of Episode 4 , the season finale: The CFO takes on seven key responsibilities and leads the fight against fraud.
*This four-part blog series is based on the Yooz research-based white paper of the same title. Available for download .