More than half of the businesses in Canada that took part in a recent survey indicated that they had been the victim of fraud in the past year.
A whopping 56 per cent of businesses admitted to being victimized, according to the Pricewaterhouse Coopers survey.
And, of that 56 per cent, a quarter of the businesses said their losses exceeded $500,000 and a significant portion of those crimes were committed by someone working for the company.
RCMP Inspector Kerry Petryshyn is trying to help prevent businesses fall victim. He was in Charlottetown Thursday to speak to a group of people comprised of small business and not-for-profit business owners.
ProfitLearn P.E.I., in association with the RCMP, hosted a forum called Fraud Prevention: Tips, Trends and Tactics.
Petryshyn said educating businesses is a big factor.
"If we can make people aware and give them the tools to prevent them from being victimized we're ahead of the game,'' the RCMP inspector said in an interview following his address.
Petryshyn compared fraud to domestic violence in that few cases are ever reported. Police are forced to rely on surveys and research to gauge how big an issue it is.
He said there are various reasons why so many companies never report fraud.
"There is that stigma that if you're a victim of fraud you must have been stupid or you're somehow uneducated, and that may be the case in a minor way, but these days the organized crime groups that are committing fraud are skilled at what they do.''
He said they are targeting their victims with well thought out business plans.
"Any one of us could potentially fall victim. Once we start getting victims to realize that and that they shouldn't be ashamed of being a victim of fraud (we'll be better off).''
Mary Best, a partner in the accounting firm Arsenault Best Cameron Ellis, spoke at Thursday's forum about controls small businesses and not-for-profit can put in place to minimize the risk.
Best said the message certainly is not ‘don't trust anybody'.
"No, it's really just the opposite,'' Best said. "You should put some controls in place that allows people to know where their limits are and then you can have trust in them, that they're not going to exceed those limits.''
She recommends small business owners take a more active interest in duties. Segregate duties. Have different people open the mail, take care of receipts, handle deposits at the bank. If the business isn't large enough to allow for that, share the necessary duties.
"Make sure the owner, from time to time, looks into these areas, that they're not an absentee owner.''
RCMP Corporal Troy MacLean said over the past five years there have been a number of suspected fraud cases investigated on P.E.I. by police.
"And these are only the cases that are brought to the attention of police,'' MacLean said. In reality, many cases of fraud go unreported. The best way to address fraud is to set up controls that will prevent attempts in the first place.''
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Prevent fraud
Tools for small business and not-for-profit business owners:
* Never sign blank cheques, something police say many small business owners do. It is an invitation for somebody to do something with them.
* Always keep track of your bank statements. Pick it up directly at the bank or view it online.
* Make sure one person isn't in charge of everything, from opening the mail to handling deposits and invoices.
* Don't be an absentee owner. From time to time, look into things to make sure there are no surprises.
* Document any problems or errors.
* Have outside forensic audits done periodically.
* Don't be afraid to call police if you suspect someone is committing fraud.
Don't
That might work for accountants, but many professions don't have any regulatory power (some beig the only place in Canada where they dont) so there is nothing a professional body can do except tell the business to call the mounties.