The Fraud Examiner

7 Steps for Designing an Anti-Fraud Training Program

By Mark Scott, J.D., CFE

April 2015

Employees are a valuable source of information for discovering potential fraud. According to the 2014 Report to the Nations on Occupational Fraud and Abuse, which analyzed nearly 1,500 cases of occupational fraud worldwide, more than 40 percent of the cases studied were discovered through tips, and employees were the source of almost half of all tips.

It is therefore important to provide anti-fraud training to all employees, especially those in high-risk areas.

Effective anti-fraud training offers several benefits. Well-trained employees can identify suspicious activity, and, through the training, management can communicate its commitment to high ethical standards and fraud prevention. Effective anti-fraud training can also improve employee morale and lead to increased compliance with legal and regulatory obligations and standards.

But how does one create an anti-fraud training program? It can be daunting to start from scratch, so this article explains a seven-step approach for designing an effective anti-fraud training program. This approach, although not exhaustive, should serve as an effective guide to creating employee-training programs that actually work.

Step 1: Define the Training Needs

Define your organization’s training needs by identifying weak areas where training is required most. Generally, the training needs are those areas in which employees lack the skills or knowledge to combat fraud.

Defining the organization’s training needs will provide some benchmarks against which to evaluate the effectiveness of the resulting training program.

There are many ways to determine an organization’s training needs, including:

Interviewing managers, supervisors, and employees about areas in which they think they need fraud-awareness training

Evaluating internal audit reports to understand the concerns associated with the organization’s risk-management, governance, and internal-control processes

Reviewing the organization’s fraud risk assessment, if available, to identify the nature and extent of the fraud risks to which it is exposed

Analyzing common risks in the organization’s industry

Assessing the organization’s security policies and procedures to protect sensitive information and mitigate risks associated with information security breaches

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