Reported cases of internal fraud are increasing following spending review cuts
20 June 2011 – Document management software company, Version One, is urging public sector organisations to implement electronic document imaging and cheque printing solutions to combat rising levels of fraud.
A recent survey by PriceWaterhouseCoopers (PwC), which polled 110 senior representatives of government and state-owned enterprises, has revealed that the number of public sector organisations impacted by fraud has risen from 52 per cent to 60 per cent in the last twelve months. PwC’s survey also revealed that, for the first time, internal fraud has overtaken external theft as the largest economic crime in the public sector. Internal fraudsters are responsible for 53 per cent of detected economic crime, up from 39 per cent from the previous survey conducted in 2009.
Julian Buck, managing director of Version One says, “PwC’s research suggests a worrying trend in reported cases of fraud which could well increase as more employees seek a quick fix to their financial worries. To prevent this escalating risk from becoming a major issue, it’s essential that organisations have effective document retention policies and document management systems in place to frustrate potential fraudsters.”
Electronic document management (EDM) systems, tightly integrated into organisations’ accounting, ERP and HR systems, minimise the risk of fraud as documents, such as invoices, purchase orders and personnel records are imaged and then securely stored in an electronic archive. These electronic documents are a permanent record that cannot be destroyed or altered in any way, reducing the risk of an employee eliminated or manipulating evidence to cover their tracks.
Document management systems also allow strict levels of document access and make it possible to maintain audit trails so it is clear who approved what and when, further counteracting attempts to hide any fraudulent activity. In fact, every document in the archive has its own distinct electronic ‘fingerprint’, logging any activity relating to that document. It is impossible to delete any of these activity logs, so the attempts of even the most desperate fraudster to cover their trail would be detected.
Buck comments, “It is always going to be a challenge to prevent an unscrupulous employee from committing fraud act if they have their mind set on it. However, organisations can implement measures and systems to help protect themselves from acts of fraud. Installing an EDM system is one such measure and can be vital in the prevention of accounting fraud.”
Whilst a number of organisations use the BACS payment system, there is still a requirement to make payments by cheque, providing another opportunity for fraudsters to strike. EDM systems, with integrated cheque printing functionality, use specially adapted laser printers with additional security features to prevent internal misuse, as well APACS and PIRA-approved toners for protection against cheque alteration fraud.
Buck adds, “Secure cheque printing solutions provide an efficient, cost effective way for organisations to print cheques while greatly restricting the ability to commit fraud. These systems use special fraud-resistant stationary, ensuring no bank or cheque details are pre-printed. The stationery is numbered and easily traceable, but there are no cheque numbers to void and no gaps in numbering to account for. This technology can also be used for numerous other applications including the production of fraud-resistant vouchers and certificates and for adding bank giro credits to invoices and statements, further preventing financial crime.”
Notes to editors
About Version One www.versionone.co.uk
Version One Ltd is the author of electronic document management and imaging solutions. These solutions enable the electronic storage, retrieval, management, enhancement and delivery of business documents such as invoices, purchase orders and statements. This 'paperless office' technology is seamlessly integrated into all major ERP and accounting systems and with a typical ROI of less than six months, Version One's solutions are enabling thousands of organisations to cut paper consumption whilst saving dramatic amounts of time and money.
To increase the awareness of Version One’s Clean and Green Project and for project information and updates as well as green hints and tips, Version One has launched its Eco Gecko website www.ecogecko.org.
Version One is an Advanced Computer Software Group plc company.
Ben Carey and Tim Palmer, Version One
+44 (0)1625 856505
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