When employees steal: Five reasons your business could be vulnerable to fraud

The last thing you want to discover is that one of your employees is stealing from your small business. Not only is it a total violation of your trust, but internal fraud also has the potential to put you out of business. According to the Association of Certified Fraud Examiners, businesses lose an average of 5% of revenues each year to fraud. Could your company survive if an employee stole 5% of your revenues?

My new book, Essentials of Corporate Fraud, details many of the red flags that may point to fraud in your company. There are literally hundreds of warning signs that might indicate an employee is engaged in a fraud scheme. Here I'll just mention a few:

Is an employee struggling with personal problems? Employees with financial troubles, addictions, chronic legal problems, instability in their personal lives, or unusual work habits might be more likely to commit the fraud.

Are accounting errors popping up? A company's accounting process and financial records might also point to an ongoing fraud. Some of the best business software will alert you if bookkeeping entries don't line up the way they should.