Tips to Avoid Phishing Scams

 

Due to the growth in the number of “Phishing” incidents reported in recent months, the forensic accounting experts from SDC CPA bring you the following recommendations to facilitate their detection and mitigate their effects.

Should Accounting Firms Embrace Shared Office Spaces?

 

Shared office spaces, or coworking spaces, are an increasingly popular option for freelancers, small businesses, and remote workers who do not have access to a centralized office space. These rented workspaces can give individuals and small businesses access to a high-end, high-function office space without a major investment.

For CPAs, accounting firms, and other businesses these shared spaces may offer a host of solutions and conveniences to cut costs and boost productivity. During the COVID-19 pandemic, coworking spaces may be a gamechanger for many firms.

Benefits of Coworking Spaces

Coworking spaces are becoming increasingly popular. Some companies see coworking solutions as offering a full spectrum of benefits offered by coworking solutions.

·       Going Green – Shared workspaces often consume fewer resources, minimize building sprawl, and reduce companies’ carbon footprints. Operating in a coworking space can be an effective, socially responsible solution for small businesses looking to expand sustainably.

·         Recouping Pandemic Losses – As businesses return to onsite work, leadership may expect to make changes and reforms in an effort to recover from pandemic-related losses. Rethinking the company’s workspace may be a solution.

·         Better Locations – Moving some personnel to a coworking space closer to essential services may cut delivery and receiving costs, improve access to clients, and reduce travel needs.

·         Maintenance-free – Opting to rent shared office spaces can eliminate additional costs such as utilities, internet, building maintenance, and support staff. In a coworking space, your business may only need to pay for a desk, room, and chair—some of which can be shared between multiple employees.

·        Opportunities for Collaboration – With multiple businesses and freelancers sharing the same space, partnerships and collaboration can grow naturally. For example, a CPA might build an otherwise unexpected business relationship with a freelance advertising consultant down the hall.

While the traditional route of renting a building or office space may suit some businesses, a coworking space may help others boost efficiency and cut costs. For fledgling women and minority-owned businesses, a coworking space may help such businesses to grow.

Five Ways Small Business Can Prevent Employee Fraud

 

Fraud can take many forms, from scammers who defraud small businesses, to employees who steal from their employers. Since the 2007 recession, fraudulent activity against small businesses has increased, as has the amount of money lost to fraud.

Between fraud losses and lost profits due to the downturn in the economy, small business owners face increased pressure to make a profit margin, and stay in business. Here are five tips offered by SDC CPAs forensic accountants on how to keep your small business safe from fraud.

Five Tips to Protect Your Business Against Fraud

 

1. Stay alert

Although it sounds obvious, many small business owners are not alert for possible fraud. Some spend a lot of time away from the office, while others simply trust too much those around them. However, the truth is that preventing fraud requires both monitoring the work area and your team, carrying out constant inventory controls and updating registration systems.

2. Install security cameras

This is especially recommended if you have a warehouse or there are areas in your business that remain unattended most of the time. It is also a good idea to place a camera on top of the cash registers to discourage theft. Some security cameras include systems that can transmit images directly to your phone, wherever you are. Moreover, some of these cameras don't even require professional installation.

3. Have a clearly written regulation

Every small business owner should have a clearly written definition of workplace fraud, and should outline what fair and reasonable actions managers should take if fraud is suspected. All employees must receive a personal copy of the regulations, both as a separate document and as part of a reference manual on labor procedures. The employer must keep copies of the regulations signed by all employees, and management must insist on carrying out all consequences of violations of the regulations.

4. Conducts a detailed background check on each prospective employee

Although a detailed background check on each new employee will incur additional expenses, the cost of this review is economic insurance against a potential criminal that could end up costing your company thousands of dollars in losses. Online public records searches alongside standard credit records can better acquaint a potential employee.

5. Always check references

Before hiring a new employee, always ask for both personal and professional references. As reported by SDC CPA, nearly three in ten employers have encountered a false job reference and 62 % of previous employers did not say favorable things when contacted to discuss a candidate. However, most employers don't bother to double-check employee references before hiring them. Do not be one of them.

The Continuing Challenges of Forensic Accounting during COVID-19

 

Economic hardship such as layoffs, market losses, and economic uncertainty often correlate to increased occurrences of employee theft, in turn increasing business for forensic accounting firms.

This trend has partially held true for the economic challenges caused by COVID-19. While fraud cases have spiked, a number of obstacles threaten to change the landscape of forensic accounting.

 

Investigating Fraud from a Distance

Conditions of social distancing, quarantines, and closures has impacted opportunities for forensic accountants in several ways. Traveling to meet with insureds to analyze pertinent documentation has been curtailed. Opportunities to meet with, collaborate, and engage with other professionals have also been affected. Limited court operations have made this aspect of forensic accounting more challenging and less available.

Like many business, forensic accountants have adapted to using Zoom and other means of communication due to COVID-19. However, these virtual meeting platforms are not without their challenges. The lack of social cues and body language takes away important tools.

Forensic accountants are continuing to evaluate their options and alternative solutions for mitigating the difficulties of remote work.

 

An Influx of Fraud and Delays

Forensic accountants have described seeing a significant increase in fraud. Loss of Income claims have spiked. Forensic accountants are also facing new threats, such as criminals selling phony relief checks on the dark web. Investigating new and developing schemes can be especially demanding for forensic accountants. Despite the influx of fraud to investigate, many forensic accounting firms face delays due to the inevitabilities of remote work, such as slower collaboration and communications.

Even with obstacles such as major delays and the challenges of social distancing, many forensic accounting firms are working hard to adapt and thrive in these unstable conditions. Throughout the COVID-19 pandemic, SDC CPAs has been dedicated to both serving clients’ best interests while maintaining high safety standards for employees and firm pandemic mitigation efforts.

How Romance Scammers Steal Hearts and Money

 

Online dating has become enormously popular, with couples meeting on social media and dedicated dating sites and apps. According to a 2019 Stanford study, 39% of heterosexual couples met online rather than though a personal connection. As more people look to the internet to find love, scammers are waiting to fake their way into individuals’ hearts and bank accounts.

Romance scams are forms of online impersonation scams and confidence scams—both of which present a risk not only to those looking for love, but to businesses making connections digitally.

 

About the Scams

Online romance fraud typically takes the form of scammers running fake accounts designed to earn people’s trust and maintain phony relationships with the goal of stealing money from the victim. Often, these accounts use pictures found on the internet to create an attractive, convincing persona.

These phony personas use a number of social engineering techniques to overcome individuals’ reservations and reason. Scammers may play to the victim’s desires or create a narrative of urgency as a way to orchestrate a whirlwind romance, ensuring that when they finally ask for money, passion and emotion cloud the victim’s judgment.

Other scammers may opt for a more long-term approach, mimicking a real relationship to overcome suspicion and create a disarming sense of dependence. In these cases, it is common for the scammer to string the victim along, requesting travel expenses to meet in person before cancelling at the last minute.

Typically the fraudulent requests begin with gifts (often requested in Amazon wishlists) before the steeper, more dramatic requests begin. These more significant sums are often the endgame for scammers, sometimes in the form of a phony medical emergencies or travel expense.

 

Spotting an Online Impersonation Scam

Businesses operating in digital spaces face similar risks with impersonation scams. Often online impersonation scams use similar tactics to romance scams, relying on emotional factors – such as hesitancy to ask questions, deference to authority, and desire to please – to trick employees into making unauthorized transfers.

To prevent losses (or heartbreak) to these scams, SDC CPA advises individuals and businesses making connections online take the following steps:

·         Look for red flags, including an insignificant digital footprint, untimely requests for money, and excuses for avoiding simultaneous/non text-based communication.

·         Watch for inconsistencies in answers or a relationship (business or personal) progressing too quickly.

·         Do not let urgency overrule caution.

·         Reverse-image search all pictures received to see if they are stolen.

·         Share details with trusted individuals, they may be able to provide perspective and notice additional red flags.

With the FTC reporting $143 million in online romance fraud losses in 2018, singles risk more than just a broken heart when looking for love. Losses to online romance scams may be claimed as theft in the tax year it is discovered if certain conditions are met. Victims of these scams should check their state’s laws to determine whether the scam would be considered theft and keep documentation to demonstrate the scammer’s intent.

Tips for Eliminating Bias in the Workplace

 

Bias in the workplace can be deeply harmful for any organization. Between turning away talented employees, hurting diversity, and lowering morale, bias can prevent organizations from achieving their goals and reaching their full potential.

Unconscious bias is one of the most damaging forms of bias, yet can be the hardest to address. Based on diversity and inclusion initiatives from Studler Doyle's founder, Dee Studler, SDC CPAs has compiled the following suggestions for recognizing and eliminating unconscious bias in the workplace.

 

Carefully Plan Diversity Programs

While mandatory diversity training may be used effectively, it is a well-documented phenomenon that mandatory diversity programming can create resentment and fuel bias, rather than eliminating it. Other options, such as incentivized or voluntary diversity programming, tend to inspire and encourage employees to recognize and address bias themselves.

 Another key piece of diversity programming is knowing when to rely on experts. When in-house leadership does not have sufficient knowledge or perspective to authentically and effectively discuss an issue, it may be critical to rely on a guest speaker’s perspective and expertise to communicate the message.

 

Create a Culture of Inclusion

Ultimately, the goal of any diversity programming is to help employees recognize bias and become advocates for inclusion. One tool that can help employees and leadership realize and confront their own biases is Harvard’s Project Implicit, a collection of quick tests that assess individuals’ unconscious bias or automatic preference. Seeing these results can spur action and inspire change.

 Leadership’s commitment to diversity is essential for any workplace to improve its handling of bias. Listening to and addressing employees’ ideas and concerns is a major part of demonstrating the organization’s commitment to inclusion. Affecting company culture may start with surveying employee attitudes toward diversity and methods for reporting instances of bias. Having proper channels to ensure employees are comfortable with reporting and discussing bias can be crucial for advocacy and empowerment.

 

Reduce Individual Input

Companies can work to mitigate the effects of individual unconscious bias by making structural changes. In hiring, for example, technology can be used to find and hire the best candidates without an individual’s bias working against them. Additionally, personnel decisions come with supporting data and explanations. These decisions being made without sufficient justification can be a sign of bias and should be evaluated.

Assessing the diversity of programs and initiatives can be another crucial step for uncovering bias. For example, mentoring programs that rely upon an individual approaching a mentor tend to favor white employees and male employees. Creating a more formal structure could mitigate bias in these circumstances.

Recognizing and addressing workplace bias takes sustained effort and commitment—there is no one-size-fits-all solution. With time and attention, however, organizations can achieve a more equitable, inclusive future.