{"id":9488,"date":"2022-03-30T10:20:23","date_gmt":"2022-03-30T10:20:23","guid":{"rendered":"https:\/\/crigroup.com\/?p=9488"},"modified":"2024-01-22T10:14:53","modified_gmt":"2024-01-22T10:14:53","slug":"employee-fraud-why-are-human-factors-so-important-in-risk-management","status":"publish","type":"post","link":"https:\/\/crigroup.com\/ar\/employee-fraud-why-are-human-factors-so-important-in-risk-management\/","title":{"rendered":"Employee Fraud: Why are Human Factors so Important in Risk Management?"},"content":{"rendered":"<p><span data-preserver-spaces=\"true\">When any fraud, including employee fraud, is discovered, it&#8217;s usually by surprise. That&#8217;s because most of us aren&#8217;t used to looking for criminal behaviour inside our organisation. We trust our employees and co-workers, and we keep our focus on succeeding as a team and accomplishing our goals for the business. Nobody wants to think that someone might be subverting the rules for their gain.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Unfortunately, though, fraud does happen. The statistics tell us that, on average, organisations lose about 5 per cent of their total revenues to fraud, and the median loss in frauds committed by owners\/executives is $600,000. If that&#8217;s not bad enough, the average fraud lasts 18 months before being discovered \u2013 if it is discovered at all (<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/www.acfe.com\/report-to-the-nations\/2020\/\" target=\"_blank\" rel=\"nofollow noopener noreferrer\"><span data-preserver-spaces=\"true\">ACFE, 2020<\/span><\/a><span data-preserver-spaces=\"true\">).\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Employee fraud is a combination of complex events, and many organisations include &#8220;human factors&#8221; in generic terms in the causation path of failure. Because for many organisations, it is hard to specifically identify human factors and understand how to manage them. At CRI\u00a0Group\u2122, we have 32 years of experience in the causes of potential deviations, the unwanted scenario that organisations may face, and the controls necessary to prevent or mitigate incidents. Our analysts uncover the truth every day; here are the most common human factors that lead to employee fraud:<\/span><\/p>\n<ul>\n<li><span data-preserver-spaces=\"true\">Pressures to Perform<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Staff Reductions<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Departmental Cuts<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Business Survival<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Overworked Audit Staff<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Increased External Vulnerability Due to Weak IT Controls<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Reduced Regulatory Oversight<\/span><\/li>\n<\/ul>\n<h3><span data-preserver-spaces=\"true\">Human factors in risk management<\/span><\/h3>\n<p><span data-preserver-spaces=\"true\">Understanding the impact of human behaviour on your primary process is key. When we address human factors related to health and safety, we aim to optimise human performance and reduce human failures. Organisations need to take a proportionate approach to human factors in risk assessment based on their hazard and risk profile. Several large companies have recognised the value of adopting some kind of a risk model.\u00a0<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Applying human factors tools and techniques in your risk assessment is detrimental to the safety of your workforce too. This human factor risk management process should consider work ethic, culture, and stakeholder expectations as organisational culture is affected by these concepts and links management processes to corporate sustainability.<\/span><\/p>\n<h3><span data-preserver-spaces=\"true\">Benefits of implementing human factors in risk management<\/span><\/h3>\n<ul>\n<li><span data-preserver-spaces=\"true\">Reduce turnover and training costs<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Gain a competitive edge through the hiring of better people<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Increase productivity \u2013 help your employees be more productive knowing that everyone employed by your company has been screened<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Set your company apart and win more business<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Reduce employee-related problems<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Protect company reputation\/brand &amp; customer relations<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">\u00a0Comply with mandates created by state or federal law for certain industries<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Increase retention<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Reduce negligent hiring claims<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Avoid violence in the workplace (threats of violence and actual violence)<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Reduce theft and espionage<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Avoid lawsuits and the costs associated with the defence<\/span><\/li>\n<li><span data-preserver-spaces=\"true\">Avoid loss of goodwill<\/span><\/li>\n<\/ul>\n<h3><span data-preserver-spaces=\"true\">Mitigate employee risk<\/span><\/h3>\n<p><span data-preserver-spaces=\"true\">Organisations spend years and thousands, even millions, to brand their products and services &#8211; it only takes one bad hire to cause a loss of capital and reputation. Employee Background Checks can aid in reducing the risk of hiring an employee who does not live up to their supposed skill set and could cause irrevocable damage. It can cause a business to fail, especially if the employee holds malice toward the organisation.\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/crigroup.com\/ar\/employee-background-checks\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">EmploySmart\u2122<\/span><\/a><span data-preserver-spaces=\"true\"> is CRI Group&#8217;s own solution aiming to expose vulnerabilities and threats within your organisation. Our EmploySmart\u2122 is a risk management measure that can significantly reduce business and financial crime, fraud and malpractice within your workplace.<\/span><\/p>\n<p><span data-preserver-spaces=\"true\">Our EmploySmart\u2122 solutions are also certified by the\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/crigroup.com\/ar\/bs7858-vetting-playbook\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">British Standard Institute BSI for the scope of BS 7858:2019<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0Screening of individuals working in a secure environment, Code of practice (the only BS 7858 certified background screening services provider in the UAE and across the Middle East); and BS 102000:2018 Code of practice for the provision of investigative services.<\/span><\/p>\n<p><a class=\"editor-rtfLink broken_link\" href=\"https:\/\/cta-service-cms2.hubspot.com\/ctas\/v2\/public\/cs\/preview\/click?cta_guid=e91eb237-ff13-49cc-918c-c81a5c713cc1&amp;placement_guid=a7f8c394-f038-468c-910c-190194708355&amp;portal_id=2506761&amp;redirectUrl=https%3A%2F%2Fcrigroup.com%2Fget-a-quote%2F\" target=\"_blank\" rel=\"nofollow noopener noreferrer\"><span data-preserver-spaces=\"true\">Let&#8217;s Talk<\/span><\/a><\/p>\n<h3><span data-preserver-spaces=\"true\">Other Solutions&#8230;<\/span><\/h3>\n<p><span data-preserver-spaces=\"true\">CRI Group\u2122 has experts who have conducted fraud investigations worldwide for organisations of all sizes and industries. Our investigators work on-site at your company bringing a boots-on-the-ground approach to uncovering all the case facts. When you&#8217;ve uncovered fraud, that&#8217;s the time to let the experts take over. You owe it to yourself and the future of your business to make sure every investigation is done professionally and effectively.\u00a0<\/span><\/p>\n<p><a class=\"editor-rtfLink broken_link\" href=\"https:\/\/cta-service-cms2.hubspot.com\/ctas\/v2\/public\/cs\/preview\/click?cta_guid=e91eb237-ff13-49cc-918c-c81a5c713cc1&amp;placement_guid=a7f8c394-f038-468c-910c-190194708355&amp;portal_id=2506761&amp;redirectUrl=https%3A%2F%2Fcrigroup.com%2Fget-a-quote%2F\" target=\"_blank\" rel=\"nofollow noopener noreferrer\"><strong><span data-preserver-spaces=\"true\">Get a FREE QUOTE<\/span><\/strong><\/a><\/p>\n<p><span data-preserver-spaces=\"true\">CRI Group&#8217;s unique identity and vision evolved from our fundamental desire to support our clients and their candidates, thus creating the <\/span><a class=\"editor-rtfLink\" href=\"https:\/\/crigroup.com\/ar\/due-diligence-services\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">DueDiligence360\u2122<\/span><\/a><span data-preserver-spaces=\"true\">. Identifying key risk issues clearly and concisely helps enhance your knowledge and understanding of the customer, supplier, and third-party risk, helping you avoid those involved with financial crime. The DueDiligence360\u2122 reports help organisations comply with\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/crigroup.com\/ar\/compliance-solutions\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">anti-money laundering<\/span><\/a><span data-preserver-spaces=\"true\">,\u00a0<\/span><a class=\"editor-rtfLink\" href=\"https:\/\/crigroup.com\/ar\/anti-bribery-solutions\/\" target=\"_blank\" rel=\"noopener\"><span data-preserver-spaces=\"true\">anti-bribery, and anti-corruption<\/span><\/a><span data-preserver-spaces=\"true\">\u00a0regulations. This service also proves beneficial ahead of a merger, acquisition, or joint venture. It can be used for a third-party risk assessment, onboarding decision-making, and identifying beneficial ownership structures.<\/span><\/p>","protected":false},"excerpt":{"rendered":"<p>When any fraud, including employee fraud, is discovered, it&#8217;s usually by surprise. That&#8217;s because most of us aren&#8217;t used to looking for criminal behaviour inside our organisation. We trust our employees and co-workers, and we keep our focus on succeeding as a team and accomplishing our goals for the business. Nobody wants to think that [&hellip;]<\/p>","protected":false},"author":1,"featured_media":6276,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12,13,146],"tags":[31,32,33,34,35,30],"class_list":["post-9488","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-due-diligence","category-employee-background-check","category-resources","tag-anti-corruption","tag-anti-fraud","tag-bribery","tag-compliance","tag-corruption","tag-risk-management"],"gutentor_comment":0,"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v16.5 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<meta name=\"description\" content=\"Employee fraud is a combination of complex events, and many organisations include &quot;human factors&quot; in generic terms in the causation path of failure.\" \/>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/crigroup.com\/ar\/employee-fraud-why-are-human-factors-so-important-in-risk-management\/\" \/>\n<meta property=\"og:locale\" content=\"ar_AR\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"Why are human factors so important in risk management? 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