Prioritizing fraud program documentation

In my consulting career, I often supported banks in the review or creation of fraud program documentation. Oftentimes, I found that enterprise fraud policy documentation lacked sufficient detail, with common gaps related to fraud definitions and examples, roles and responsibilities across the organization, and program governance. These common gaps can lead to program pitfalls, spanning day-to-day misses all the way to regulatory trouble. For example, a lack of sufficient detail related to roles and responsibilities across the organization can lead to several problems, such as:

Documentation isn’t a novel or hard-hitting topic. For this reason, among others, I’ve seen fraud program documentation fall to the wayside as shiny, new fraud tools and constant fraud attacks steal the focus. However, documenting your fraud risk management program is essential and requires a strong foundation that includes policies, standards and a program framework to be successful. Fraud program documentation gaps can cause problems that might not surface until later, and at that point the damage may be done.

Why documentation falls to the wayside

In my experience, organizations disregard fraud program documentation for two main reasons:

Creating an enterprise-level fraud policy