In support of Crime Prevention Month, The Hanover Insurance Group, Inc. has shared insights into four common crime schemes that prey on businesses.
“Business owners spend a significant amount of time and resource protecting their business from a variety of risks, whether it’s liability for their products or services or severe weather,” said Helen R. Savaiano, president of management liability at The Hanover. “But, what can sometimes be overlooked are the risks presented by unscrupulous employees and unfortunately those types of losses happen more often than business owners think.”
Based on a study of claims experience, The Hanover identified the following four common crime schemes in business:
- Billing and Vendor Schemes – Employees set up false vendor accounts and bill a company for non-existent parts or services.
- Check Tampering Schemes – Employees use company checks to pay themselves or reissue the company’s old outstanding checks and alter the payee to themselves.
- Payroll Schemes – Employees manipulate the amount on their check, or create duplicates of their check to cash more than once.
- Expense Reimbursement Schemes – Employees submit additional expenses that never occurred or were not of a business nature and are then reimbursed for those bogus expenses.
Many business owners don’t realize they could have been protected from fraud committed by their own employees until it’s too late, according to Jeffrey Gordon, vice president of fidelity and crime at The Hanover.
Source: The Hanover
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