Compliance and Fraud Hotline
Boost Your Risk Management Efforts and Internal Control Control Effectiveness with the REDW Compliance & Fraud Hotline
How does a fraud hotline complement my Risk Management program?
Every step you take toward creating a stronger deterrence environment saves your organization money and avoids damage to your reputation. According to the Association of Certified Fraud Examiners (ACFE) in its 2014 Report to the Nations, the number one way most on-the-job fraud is discovered is through a tip by another employee.
This is why we developed the REDW Compliance & Fraud Hotline. In partnership with The Network, Inc., the leading national provider of hotlines, REDW offers the Hotline as a 24/7/365 service, available through a toll-free number, that provides a place for employees and others to report financial fraud, waste and abuse, or noncompliance with state, federal, and tribal regulations.
Consider the following business issues in determining how the Hotline can help your organization.
We’ve heard a lot of fraud goes undetected.
Unfortunately, this is true. Many of the management strategies businesses rely on fall short when it comes to fraud. According to the ACFE, most people who commit fraud are first-time offenders, so background checks won’t identify them. Strong internal controls and other measures that create a deterrence environment all help, and the REDW Compliance & Fraud Hotline adds another layer of protection.
Issue: Getting the tip is just the tip of the iceberg.
Solution: Once you suspect a problem, REDW has many resources available to help clients with investigations, including skilled internal auditors and forensic examiners who can help evaluate fraud and compliance issues, and experts who can provide written reports, litigation support and expert witness testimony to help you recover your losses and take appropriate actions regarding those responsible.
Issue: We’re concerned that no one will use the service.
Solution: Many criteria factor into the successful adoption of the REDW Compliance and Fraud Hotline. One factor is anonymity. Callers to the hotline are not required to provide their names, although some may choose to do so. Having an anonymous system considerably reduces the chance that a single caller will be identified—limiting the risk of retaliation. In order to create awareness, REDW also provides a complete set of communications materials, including posters, brochures, and wallet cards, to publicize the service organization-wide.
Issue: We’re concerned that employees will abuse the hotline.
Solution: Professionally trained interviewers who respond to calls to the REDW Compliance & Fraud Hotline follow a prepared script that assists them in collecting detailed information. This method helps separate the serious reports from the personally or politically motivated ones. The posters and other materials REDW provides as part of your service identify the types of calls employees should be directing to the Hotline and suggest that human resources issues are best resolved internally.
Issue: Can my organization afford the service?
Solution: Absolutely. If you consider that the ACFE estimates that the average organization loses five percent of its revenues to fraud every year and that the median loss reported was $145,000, the nominal cost of investing in the Hotline makes sense. Each organization is charged on a sliding scale according to the number of employees – making the annual fee very affordable even for small businesses and nonprofit organizations.
Typical Fraud Hotline Tips
- Fraud, waste and abuse
- Regulatory compliance violations
- Theft of cash, inventory, services or time
- Accounting and audit irregularities
- Falsification of records
- Conflicts of interest
- Unauthorized discounts
- Fraudulant insurance claims
- Disclosure or theft of proprietary information