top of page
  • Writer's pictureSteve Dawson

Anti-Fraud Program and Trust: The Organization's Responsibility

Updated: Feb 15

Many leaders never approach an anti-fraud program (or have no anti-fraud measures at all), because they do not know how to address the issue of trust.

Do you trust your employees? Your co-workers? Your professional community? Doesn’t implementing an anti-fraud program imply you DON’T? Increasing internal controls feels like you are questioning everyone’s every move. Requiring employees to sign a fraud policy feels like you suspect them of dishonesty as a default. Performing routine anti-fraud training feels like you are paranoid and waiting for an inevitable attack.

But let’s flip the perspective. Instead of worrying about how your employees’ feel about your trust in them, consider their confidence in trusting you. How much trust do they have in your organization? Where does that trust originate? Blind belief that you, everyone, and everything in your organization is ultimately good? Or can they trust in the ethical example you set and the protective parameters you provide?

They need to be able to trust you. They need to be able to trust your organization. They need to be able to trust in each other and the business you are all building together. Providing trust to your employees enables them to rely on the character, ability, strength, and truth of your organization.

Instead of an anti-fraud program suggesting you don't trust employees, provide a program that empowers them to trust you. An anti-fraud program is a valuable contract that invites everyone to participate in the trust, success, and vision of your organization.

Tone at the Top

Self-explanatory, but “tone at the top” is a popular term that refers to the atmosphere set by the leadership. Interestingly, this now-general concept in ethics originated in the field of accounting.

Again, this tone is not set by everyone simply believing the leaders are good people. Leaders demonstrate their own commitment to integrity by modeling it and asking it of their people. This is how having employees sign a Fraud Policy and a Fraud Reporting Policy becomes much less an accusation and much more a partnership. Everyone is agreeing to support the vision and mission, and protect the interests of the organization together.

Ironically, the popularization of Tone at the Top has come mostly through failed examples. Scandals like the ones discovered in Enron, Xerox, and Fannie Mae are sobering demonstrations of the expression, “The fish rots from the head”.

Internal Controls: 10-80-10

We talk about it often. The 10-80-10 rule of ethics. 10% of people will steal at EVERY opportunity. 10% will NEVER steal no matter what. The remaining 80% are influenced based on a multitude of factors. How much are they stealing? Is anyone directly hurt by their theft? What personal financial stressors are they currently experiencing? Will they get caught? How satisfied are they in their job to begin with?

Teaching this rule to employees is a great piece of anti-fraud education. You can explain that you wholeheartedly believe that no one in your organization belongs in the 10% who always steals (And truly, I hope you never knowingly hire someone in this category). Then explain that the purpose of your internal controls, the procedures, the checks and balances, all help to prevent everyone from ever having to make a tough decision. Instead of daily temptations waiting for someone’s moment of weakness, provide a structure that can be trusted. Build morale and build protections that allow everyone to trust. Trust you. Trust the organization. Trust each other.

When introducing an anti-fraud program and new internal controls, you will probably get some push-back. What, you don’t trust us? Share everything in this post. It is not about trusting individuals. It is about providing a work environment that can be confidently trusted.

Empowering small businesses to develop strong Anti-Fraud Programs is our mission. We provide consultations to design, evaluate, and improve your anti-fraud program. You can also get a step-by-step guide to design a program that can be tailored for your specific needs by purchasing Steve Dawson’s book, Internal Control/Anti-Fraud Program Design for the Small Business.

If you think there may already be fraudulent activity in your company, contact us today through our website.


Recent Posts

See All


bottom of page