SIR - Corporate fraud continues to spiral out of control and yet simple, low cost steps that can significantly reduce the problem are still to be adopted by far too many UK businesses.

This is due in no small part to the Government's persistent refusal to clarify the confusion created by a raft of legislation, from the Data Protection Act and the Human Rights Act through to Employment Laws, Anti-Money Laundering legislation and the Proceeds of Crime Acts.

Given that the majority of fraud is employee-led - and senior employee-led, at that - the ability to track trends in payment becomes critical. Using low cost data mining tools, it is then a straightforward process to compare supplier and employee addresses, in turn picking up those fraudulent supplier companies set up by employees.

It is also straightforward to compare supplier/customer organisations with the list of senior employee interests - such as shareholdings or non-executive directorships - again identifying inappropriate connections. However, the majority of UK organisations are simply not taking this simple action because they believe, incorrectly, that they are prohibited from using employee data in this way by the Data Protection Act.

Current attitudes towards information management are confusing and conflicting. It is now high time for the Government to clarify the obvious misunderstanding associated with Data Protection and introduce an era of controlled openness regarding the right to use or share information on employees. This will give companies the opportunity to introduce some straightforward measures that will significantly reduce many of the forms of fraud now endemic in our society.


Richard Kusnierz, Director IDS

Source

SMT