The vast majority of organisations had to rapidly react to the lock down measures in March and adjust their processes to enable business to continue. For many processes this would have needed a change to the way internal controls are performed, and certainly a change to the way internal controls are tested, increasing the operational risk to the organisation.

Added to this, focus would also have shifted to strategy and how to keep the business financially afloat. Perhaps your organisation had to furlough staff members, or sadly had employees off sick for extended periods, increasing your operational risk further?

But what about the risk of fraud?

The lockdown sadly has given fraudsters a golden opportunity to take full advantage of the scenarios described above. The banks and action fraud are experiencing an unprecedented level of fraud reports. There are a number of contributing factors to the increase:

– Inability to meet with the ‘customer’ in person or at their offices due to lockdowns travel restrictions, self-isolations etc

– Our willingness to be flexible in a pandemic- who wants to be the firm to turn down a key worker? Who wants to be responsible for a business going under in these times?

– Remote working- there is no doubt that we have proved we can work well together remote working, however, there are so many little side conversations, comments, overheard telephone calls etc in an office environment that we lose by remote working.

– Remote working fatigue- some people do not like working from home and struggle to separate work/home, work rate starts to fall, fatigue sets in……

– Furlough- it is true that being able to furlough staff has saved some organisations from financial ruin, however, all employees should add value to the process and taking these employees out would have weakened the armour.

Risk and Compliance training, particularly fraud training needs to be frequently updated and we would recommend that NOW is the time to hold these training sessions with your staff. Remind them of the controls, and the flags to raise! 1RS provides fraud risk training sessions tailored to your business.

We also review your internal controls environment, perform independent testing and can advise you of how to strengthen your processes so you are not the next organisation to fall victim to the fraudsters.

Talk to 1RS for more information

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