Occupational fraud risk isn’t necessarily shared evenly by all business sectors. Certain industries — for example, construction, real estate, manufacturing and transportation — are usually more vulnerable to employee theft, according to the Association of Certified Fraud Examiners (ACFE). Other industries may not have greater fraud exposure but face specific threats. Here are some industry-related risks and how businesses in these sectors can prevent fraud with strong internal controls. Construction Some types of fraud are more prevalent in the construction industry, particularly payroll and billing fraud. Segregation of accounting duties — having them performed by more than one employee — is critical to reducing both types. To prevent payroll fraud, have someone independent of your accounting department verify the names and pay rates on your payroll. If you...

When Anna, the CEO of a small manufacturing company, received an anonymous report about fraud in the accounting department, she wasn’t sure how to act. After all, the complaint could be accurate, but there was also a chance that it wasn’t. She called her company’s attorney, who recommended a forensic accountant to investigate. He also suggested that she perform some preliminary interviews to gather facts — but to be careful not to interrogate employees. If you’re in a position similar to Anna’s, here’s how to conduct interviews before a fraud expert comes on the case.  Investigation prep In advance of requesting any interviews, decide what information you’re looking for. Knowing what you want helps you get to the truth of the matter quickly and avoid getting sidetracked by...