Corporate crime – the need for prevention and cure
Internal crime in UK businesses is a serious problem which occasionally hits the headlines with considerable impact. For instance, a study carried out by the consumer credit industry’s own fraud prevention service, CIFAS, revealed that of 127 organisations surveyed, all but two had experienced internal fraud of some kind. With the largest actual loss running at over £1 million and the major organisations dismissing over 100 people a year for employee fraud, it represents an issue which presents business continuity and risk management challenges to an enormous variety of organisations. In actual fact, fraud is just one of a variety of criminal activities faced by businesses of all kinds. From theft of funds, equipment and data, business system attacks and interruption through sabotage, to the loss of sensitive business information and serious misrepresentation, organisations have to guard against and investigate a wide variety of risks. They also present a diverse set of problems for internal investigators who must deal with the complexities of uncovering the truth, while working with colleagues to maintain both customer service levels and business continuity whilst minimising damage to the reputation of the business. Techniques aimed at prevention, reinforced by thorough and successful investigation are vital elements in mitigating the overall risk. While an organisation can employ ongoing and effective communication aimed at crime prevention, the strongest deterrent can often be created by significantly enhancing the certainty that offenders will be caught. The continuity challenge also varies in its severity, from the short term impact the theft of a few items of equipment can have, to the huge reputational and financial implications of serious levels of theft, fraud or sabotage. One of the most important and challenging areas for any organisation investigating internal crime is that of evidence gathering. Even when there is complete certainty that a crime has been, or is in the process of being committed, many investigations fail because of the difficulties of gathering evidence. This can mean that businesses are negatively impacted by crimes for lengthy durations if they are not solved quickly. Traditional investigation methods are usually instigated in circumstances such as a ‘hole’ being discovered in the company accounts, from where events and information are tracked back with the aim of resolving the problem and identifying the offender. In the case of sophisticated crimes such as fraud, clever individuals are adept at covering their tracks, leaving little that easily points to the hard evidence of their activities. On the face of it, low level fraud may not present an obvious continuity challenge, but losses have to be replaced and organisations must allocate resources to investigation and prevention. Where this affects customers, it can present very considerable issues relating to service levels and overall customer satisfaction. As organisations become more sophisticated and internationally diverse, they are faced with additional points of risk, coupled with more elaborate, well planned and executed efforts on the part of perpetrators. Increasingly, companies are looking to fight back with improved techniques focused on solving crimes and establishing a reputation internally for stringent investigation. In the evidence gathering and analysis area of an investigation, many are turning to advanced techniques aimed at improving interview techniques and the validation of conversations between investigators and suspects. By using advanced interviewing skills, validation techniques and ‘narrative integrity analysis’, backed up by powerful technology, investigators can focus on any responses that indicate relevant risk to provide a rounded, advanced method of validation. This combined approach aims to assess all of the important signposts revealed in the emotional, cognitive and linguistic factors present in a conversation. The correlation between these various characteristics enables the investigator to assess levels of risk, associated with a particular response and take the appropriate action. These advanced validation techniques can be deployed over the telephone, offering a number of key benefits: larger groups can be interviewed over a relatively short space of time and with fewer confrontational issues often found in a more formal, face-to-face interview, especially during the early stages of an investigation. Such conversations can also be recorded and later analysed in further detail offline, hence providing an additional level of scrutiny. Correctly structuring these conversations is critical in identifying the most important and revealing responses. This ‘correct structure’ focuses on asking questions that guide professionally trained investigators to assess the responses they are given and flag any relevant issues that indicate risk. These can then be investigated further, even to the extent that a seemingly minor part of the conversation may be identified as requiring further discussion, often with technicians deploying the same techniques in follow-up conversations.
Human Resources departments quite rightly look for a high burden of proof, especially if employees can ultimately face dismissal or prosecution. Rapid completion of investigations can help prevent repeat offences and reduce the overall impact of a crime, and ongoing, in-depth investigations can also have a serious impact on staff morale, especially if people remain under suspicion unnecessarily or for an unreasonable amount of time. In the case of serious crimes, a service may have to be curtailed or suspended completely while the investigation takes place. So, while the continuity issues are generally not as dramatic as those associated with natural disasters, acts of God or contemporary problems such as terrorism, they are, in general terms, a more likely continuity problem for most companies. In many cases, an effective evidence gathering and interview process can actually bring the investigation to a head more rapidly, precisely because it is taking place within the work environment. It is not uncommon for an investigation which is narrowing down a field of suspects to be faced with sudden resignations, confessions, or an end to what had been an ongoing crime or series of crimes. Despite the perennial nature of the continuity challenge of criminal activity from within, businesses can look to highly effective, contemporary solutions to approach investigation with powerful new levels of sophistication. Dynamic managers seeking to fight back and minimise the exposures, can now go much further in gathering compelling evidence, whilst sending a strong deterrent message to anyone tempted to commit potentially damaging crimes against their organisations. Kerry Furber, MSc, is managing director of Advanced Validation Solutions provider, DigiLog UK Ltd. www.digiloguk.com
•Date: 6th October 2006 • Region: UK/World • Type: Article •Topic: BC general |
