NTCA members have risen to the myriad challenges of serving their communities in this COVID-19 business environment; however, it remains important to keep a close eye on vulnerabilities, not the least of which is the increased potential for fraud.
On a recent episode of Critical Connections, NTCA’s members-only webinar series, Jessica Kaczor, Senior Auditor and Certified Fraud Examiner with Bauknight Pietras & Stormer discussed how COVID-19 has impacted anti-fraud efforts, including a look at the Association of Certified Fraud Examiners’ (ACFE) recent report “Fraud in the Wake of COVID-19.”
Many NTCA members are operating within a new reality of remote work, travel bans, furloughs, increased focus on technology and economic uncertainty. Considering the many operational and logistical challenges surrounding these new practices, Kaczor noted how they potentially open the door to fraudulent activity through the “Fraud Triangle.”
68% of respondents have observed a significant increase in fraud.
The “Fraud Triangle” is comprised of increased incentive or pressure, opportunity and rationalization. Increased pressure may come from a variety of personal and professional sources, including situations where employees may feel responsibility to protect their coworkers from furloughs. Opportunity may increase during the rapid transition to remote work and quickly ramping up new procedures without appropriate controls. Rationalization may factor in when workers feel they are taking on a heavier workload to ensure that the organization is able to carry out essential functions.
Kaczor highlighted a few statistics from The ACFE COVID-19 Benchmarking Report of particular interest to NTCA members:
- 68% of respondents have observed a significant increase in fraud.
- 81% of respondents saw an increase in cybercrimes, including email compromise, hacking, ransomware, and malware
- Significant increase in fraud schemes from vendors/sellers (price gauging or overbilling), payment fraud (expense reimbursement schemes or credit card fraud), healthcare fraud, identity theft and insurance fraud.
What can you do? Kaczor recommend companies reassess their fraud risk and/or comprehensive anti-fraud program. If you don’t have an established program, now is an ideal time to implement a company-wide fraud risk assessment to identify areas in need of attention. Even asking the simple question of where your company is most susceptible in new working arrangements that may have circumvented existing controls or changed segregation of duties. On the personnel side, be sure to check-in with employees to gain a better sense of perceived pressures, necessary areas for training, and how the company culture is being maintained during uncertain times.
Are you an NTCA Member?
|
CRITICAL CONNECTIONS WEBINAR SERIES
The Critical Connections Webinar Series is a live, weekly update on the most pressing issues for rural broadband providers, plus a deeper dive on essential information to help you stay prepared for whatever the future may bring. For more webinars like this one, click here.
