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“Just Call Me Sherlock”: Because a Good Loss Prevention Framework Is “Elementary, My Dear Watson”

Internal fraud is rampant. Video surveillance offers a good loss prevention strategy to help fix revenue leaks and increase the bottom line.

Fraud is common in almost every business nowadays. Companies that don’t have a loss prevention strategy in place are especially vulnerable. A 2020 global study on occupational fraud estimates that businesses lose 5% of their revenue to fraud. That amounts to annual losses of $4.5 trillion worldwide!

The sad reality is that majority of fraud is committed internally. We’re not talking about missing stationery or office supplies. Many employees find ways to skim money or abuse loyalty programs. The reality is that there’s huge pressure on employees to perform and bring in more revenue. At the same time, there are lucrative incentives and tantalizing opportunities to commit fraud.

There are several ways to pull off workplace fraud. However, due to often limited or nonexistent loss prevention frameworks, preempting acts of fraud can be difficult. That said, fraud and theft are nearly impossible to accomplish without raising a few red flags along the way. Although there’s no need to be paranoid, staying alert to unusual behavior and other indicators and tightening up a few systems can go a long way toward loss prevention.

Let’s put on Sherlock’s hat and examine some simple measures you could implement to save your company millions in potential asset theft.

Loss Prevention: There Are Clues Everywhere!

loss prevention
Source: Shutterstock

Even seasoned criminals leave behind clues. These could be scattered anywhere—from financial statements and documentation to purchasing orders and employee data. Moreover, you can detect and analyze records from different types of media.

The case of Mo Bettahs, a Hawaiian-style food chain with multiple franchises, is a good illustration of fraud detection. Mo Bettahs found that keeping track of all their outlets was tiresome and challenging. In addition, they needed a way to deal with the constant threat of theft and fraud. This prompted them to enlist the help of a leading data analytics firm, Savi. Thankfully, Savi’s video management solution helped Mo Bettahs keep a handle on their operations while cutting down on revenue loss and fraud cases.

With a single click, anyone can access live video footage and recordings inside their business premises, making loss prevention simple and intuitive.

What About Instant Fraud?

Businesses can implement a variety of tactics to control instant fraud. Here are some of the more effective methods:

  • Manage financial transactions. One of the smartest things you can do is deploy a system to manage all financial transactions. It also makes sense to put a designated person in charge of handling finances. Furthermore, keep the systems you use for purchases separate from the ones responsible for salaries.
  • Protect your checks. Checks have a high potential for misuse. You'll minimize risk dramatically by requiring two authorized signatories on every check.
  • Protect your cash. Protecting cash is a priority. Here, the most basic form of loss prevention requires you to issue receipts from a pre-numbered receipt book. Other tips include tallying cash reports, receipt books, and cash counts to make sure that internal theft isn’t taking place. This is also an important part of the audit checklist.

Most Successful Loss Prevention Methods

There are many methods for realizing loss prevention. Here are some of the most common and workable approaches to curbing theft:

  • Conduct surprise internal audits
  • Work on a loss prevention checklist regularly
  • Top-level management must be strong, professional, and ethical
  • Educate your employees and get to know them personally
  • Implement internal controls and create fraud reporting systems
  • Invest in smart surveillance and tracking systems

Empower Managers Through Smart Surveillance and Tracking Systems

loss prevention
Source: Savi

Did you know that around 75% of employees have admitted to stealing from their employer at least once in their lifetime? Internal theft is a big issue for almost any business. And there’s no better way of monitoring staff activity and behavior than with a video surveillance system.

Keeping a constant, watchful eye on employees may initially be awkward for you—and uncomfortable for them. Nonetheless, supervision can be extremely effective in preventing revenue losses for your business.

Video surveillance helped Negril, too. As a popular eatery with branches in multiple locations, Negril struggled with the demands of managing all its outlets. By instituting Savi’s smart surveillance tools, which simplify monitoring activities while saving time, Negril was able to decrease losses substantially. Video monitoring not only helped fix revenue leaks but also uncovered some negative employee practices that needed attention. As a result, Negril now has a solution for avoiding theft and making employee training much smarter.

It’s worth noting that smart surveillance and tracking systems aren’t only about loss prevention. They’re also great tools for tracking employees’ workflow metrics, behavior, and daily performance—all of which can significantly boost your company’s bottom line.

A Checklist Can Go a Long Way

checklist
Source: Shutterstock

While employee fraud is often exposed by tip-offs from other employees, internal audits, and management reviews are responsible for uncovering a significant percentage of fraud cases.

Here’s how you can optimize process management and preempt loss prevention through checklists and audit cards.

Conduct Background Checks

Verify details like job history, credit history, family, interpersonal relationships, and education. An informal discussion can also alert you to possible fraud risks—for instance, an employee whose spouse recently lost their job or someone who took out a large loan. Unfortunately, fraud is often committed by those employees you would least expect. For this reason, it’s important to be mindful of changes in attitude, behavior, or work output—even among your most loyal workers.

Monitor Your Employees

A video surveillance system allows you to closely monitor employees and find out what they’re up to at any time. Putting such a system in place enforces accountability for their actions.

Monitor Cash Registers

Validate how much money is in your cash registers. Employees managing the register could potentially pocket the cash without saving the receipts. Invest in a cash-counting machine to keep an eye on how much cash is in your registers.

Perform an Internal Audit

An internal audit can reveal weak links and leaky buckets in your system. Validate accounting records regularly, and segregate employees handling cash duties. For example, one person handles the cash register, another tallies the receipts, and someone else takes the cash to the bank.

Upgrade Your Loss Prevention Framework With Savi Solutions

Dealing with internal fraud can be a big challenge. However, some tools and frameworks can help you stay on top of these issues. Savi’s video surveillance solution allows you to monitor your employees at all times, eliminating opportunities for internal theft. Moreover, with a loss prevention checklist, you’ll be able to identify any instances of fraud and minimize the damage caused.

Chat with Savi today if you’re ready to fix your revenue losses and improve your bottom line. Alternatively, you can get a demo of our services.

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