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Legal Management

Protecting Your Business Against White Collar Crimes

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Although white-collar crimes are apparently all about big enterprises and complex financial schemes, small businesses are equally susceptible. In fact, you may be at a higher risk if you run a regular business because you may not even realize that you are losing money. Things can be worse if a long-time employee you trust is responsible for the fraud. They may have inside access to your finances and records, making it possible to siphon money without raising suspicions. And they may be able to do it for years and accumulate thousands of dollars before you realize that they are missing. So it is best to have a proper strategy for protecting your business against such white-collar crimes.

Here are some measures that you must absolutely have in place.

Fortify Your Business Against Crimes by Employees

The employees of small and mid-sized businesses often get involved in financial fraud. Typically, the ones responsible for handling the financial matters are the culprits. When you give them the responsibility for handling cash, preparing tax returns or even signing paychecks, the dishonest ones may resort to means like theft and embezzlement. The misappropriation of funds may start as a small matter but you may experience hefty losses eventually. It makes sense to keep a close eye on such employees, even if you trust them. It is a good idea to have at least two people for approving deposits and expenditures to keep a check on unauthorized withdrawals. Having a third-party accountant to manage your finances also protects you from fraud and ensures that there is tight control on the finances.

Ensure Safety Against Crimes by Third-Party Vendors

While you cannot trust everyone who is employed with you, the same goes for third-party vendors and contractors. The crimes range from overbilling to delivering sub-standard or counterfeit products. The risk is major because you may lose money or even get implicated because of fraudulent action by a third party or an outside firm. You must collaborate with seasoned criminal defense lawyers to guide you in case you do get into trouble because of third-party fraud. The best approach would be to deal with vendors only after verifying their trustworthiness and reputation. You must also do proper research about any third party vendors you may be considering.

Maintain Honest Financial Records

Another important aspect of steering clear if white-collar crimes is maintaining honest and accurate financial records. You may be tempted to stretch the truth about your finances for getting approval for a loan. But this can put you in a fix because it is regarded as a fraudulent representation, which can land you in deep trouble. Similarly, you must also go the extra mile with awareness related to environmental crimes related to hazardous materials and processes. Not following the regulations can implicate you even without knowledge and intent.

Accusations of a white-collar crime can be harmful for your reputation, so you must take all the requisite steps to avoid them in the first place. At the same time, you need to keep a close eye on your employees and contractors to prevent theft and financial losses. Data loss and theft is a major concern in 2020, so it’s extremely important to take adequate measures to protect sensitive information. In addition, you should have a law firm like CCM lawyers on standby, so that legal representation is just a phone call away, in the event something comes up.

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