As you may well know, this week is National Fraud Awareness Week. Your first reaction as an HR Professional may be, “So what? “
After all, you could argue, fraud is the domain of the finance, risk and compliance people. And you’re quite right, it is. But it’s also the domain of the HR team. Why? Because fraud is committed by people and people are the responsibility and focus of HR Professionals.
Also, fraud involves a breakdown of trust – and trust and ethical behaviour fall under the HR team’s responsibilities. In addition, fraud can badly affect a company’s employer brand, and employer branding is HR’s responsibility. So fraud is therefore also an HR problem!
In light of all of this, I thought I would give you a glimpse into the future of how companies can reduce and possibly eliminate employee and other fraud …
Ask any fraud expert what you should do to control and reduce fraud and they will give you practical advice like familiarising yourself with the appropriate legislation and regulatory frameworks. They will also advise you (quite rightly) that prevention is better than cure so will strongly advise you to be extremely and constantly vigilant.
Such vigilance should be exercised in the form of regular (and surprise) forensic audits and investigations to identify and address any loopholes or vulnerabilities. After all, you wouldn’t dream of going to bed without having checked that all the doors of your house are locked to ensure that nobody can gain unauthorised access to your home.
In the same way, you need to identify the areas of vulnerability in your company and take the necessary steps to ensure that such vulnerabilities are addressed, managed and, where possible, reduced or eliminated.
Fraud experts often bemoan the lack of capacity and resources in companies to take the necessary steps to keep a watchful eye on things and they have a point. Vulnerable areas include the company’s payroll, procurements and payments. When these three functions are left unattended, criminals quickly move in and systematically and secretly strip the company of its assets.
Now, before you start pulling (what’s left of) your hair out in frustration, let me ask you something …
How would you like to have your best finance, fraud, risk and compliance experts watching every transaction in your company on a 24/7/365 basis? How would you like them to be conducting real time audits of every transaction in your company instead of conducting surprise audits only to find that money has already, like Elvis, “left the building”? And, you know how difficult it is to recover money that’s been transferred out of the company’s accounts.
How, too, would you like to protect your employees by not expecting anyone in the company to act as a whistle blower?
“A wonderful idea, but humanly impossible,” you say, with a smirk on your face.
You’re right. All the above is humanly impossible but … with a world-first, one-of-a-kind AI tech, that’s all quite possible. Right now.
It can create and deploy Digital Twins of your best finance, fraud, risk and compliance experts which monitor every transaction, whether of a few hundred dollars for stationery purchases or multibillion dollar tenders.
It can conduct real time audits and provide an audit trail that can be used as evidence in a court of law should that be necessary. It can act as your Whistle-Blower-in-Chief as it watches every transaction and can blow the whistle the moment it detects a fraudulent transaction. And criminals have no human to target for blowing the whistle as it was the tech that did it!
Sound like science fiction? You’re right. It does! But it’s alive and well and available right now, being used by certain banks, insurance companies and major governments around the world.
Why is it a world-first, one-of-a-kind tech? Well, unlike conventional AI which mines and is dependent on data, this AI doesn’t mine data. It mines the expertise of a human expert – their insight, intuition, gut instinct and judgement developed over years of experience.
And because it doesn’t mine data, it is particularly effective in low data environments (areas of high uncertainty).
Is it for everybody? No. It’s relevant for companies which have high volumes of transactions.
“But,” you say, “while we have high volumes of transactions, we don’t have such experts in-house who can be digitised.”
No problem. You can hire in Digital Twins at a fraction of the cost of human experts. And if you DO have such experts, you could hire out their Digital Twins to companies in need of them.
Does this tech replace conventional AI? Not at all. It complements it, sitting on top of all other tech.
It also displays the ethics and empathy of your experts, but that’s a story for another day.
Just thought I would let you know that, if you as an HR Professional are tired of seeing criminals get away with huge amounts of cash and really want to deal them a serious body blow, there’s now a tool that can deliver the knock-out punch! And HR Professionals can play a key role in making their finance, risk, fraud and compliance people aware of the availability of such tech!
Alan Hosking is the Publisher of HR Future magazine, www.hrfuture.net and @HRFuturemag. He is an internationally recognised authority on leadership competencies for the future and teaches experienced and younger business leaders how to lead with empathy, compassion, integrity, purpose and agility. He has been an Age Management Coach for two decades and is the author of parenting best seller What nobody Tells a New Father.