Protect yourself from fraud

IT NEED not be as much as the $510,000 Renea Hughes fleeced from NSW company RailCorp over several years so she could go gambling.

It may be $50 missing from the cash box. It may be a stolen wallet. It may be false expenses claims for entertaining clients or for taxi rides home after a late night at the office.

But they are all indications that something is amiss, and that a staff member may have a gambling problem that is getting out of hand.

Often it is in the workplace where the money is found to fuel the addiction.

According to the latest KPMG fraud survey, gambling addiction and greed are the most common drivers of fraud in Australian and New Zealand workplaces.

Renea Hughes last month admitted to the NSW Independent Commission Against Corruption (ICAC) that, among other actions, she had embezzled $366,000 from RailCorp in false invoices paid to a contractor and friend, that she faked $100,000 in salary claims and fraudulently used a rental car for two years, costing RailCorp $30,000.

She admitted every cent of the stolen $366,000 went into the pokies at pubs in Penrith in Sydney's west. The mother of two admitted she would lose sums of up to $40,000 a month in binges that went until dawn.

"Fraud in the workplace costs Australian businesses more than $77.5 million each year and often this is due to offenders seeking money for gambling," First Advantage managing director Peter Stackpole said.

"This highlights the importance of not only checking a candidate's criminal record but their employment history. If someone has had four jobs in 12 months, it is worth asking why.

"Missing petty cash or falsifying invoices may have played a role in why the individual left each job, but may not have been reported to police."

Gambling can become an addiction as pernicious as a drug addiction, with all the attendant and consuming emotions of anticipation, excitement, euphoria and despair.

While the pokies loom large in people's minds as the main form of gambling addition, horse and dog racing, scratchies, even the little old ladies game of bingo also play a significant part.

Because there is no obvious deterioration of health, a gambler can hide their addiction.

"To minimise the risk of hiring fraudulent employees, employers should thoroughly check as many components of the candidate's history as possible." Mr Stackpole said.

"The more points of reference an employer gains about a potential employee, the more informed the hiring decision."

Mr Stackpole said many organisations invested time and money in the management of fraud rather than in fraud prevention.

"To minimise the risk of fraud, employers need to take a holistic approach," he said.

"Periodic screening, in addition to pre-employment screening, helps to monitor staff as to whether they have developed any criminal affiliations or are involved in any activity that could put the organisation and their colleagues at risk.

"While a thorough background check is common in the financial services sector, few other Australian industries have adopted this level of screening in their recruitment process with the same rigour unless legally required.

"Employers who combine background screening with internal controls to protect sensitive information, minimise the chances of fraud occurring in their workplace."