An extract from the book 'Kicking Fraud to Death' by Michael Moore. Gold
Century Press ISBN 0-9750499-1-7
********
Chapter 2 - Risk Management
'... Criminals, it would seem, have been with us since time began. Where
there is an opportunity to get something for nothing or to acquire
something without a proper exchange the morally short sighted will always
be with us. And if we have a poor protection system and ventilated
armour an army could drive a truck through, we will become the targets of
such morally deficient people. As a business our target is not to
rehabilitate these individuals. Our aim is to shore up our armour to the
degree that such individuals knock, find that the expense and time to
gain entry is prohibitive - and then go looking for easier pickings
elsewhere.
Therefore as fraud is never going to go away our goal is to put into
place a system that:
· Clearly outlines possible fraudulent activities that may impact on the
company business.
· Has in place initiatives to reduce possible fraudulent activity at the
order placing stage.
· Incorporates a filtering process which can isolate those orders which
are found to be or are liable to be fraudulent and partnering this with a
verification process to establish the veracity of incoming genuine
orders.
· Recovers money lost in the event that fraudulent activity successfully
eludes the first two criteria.
· Puts in place policies and procedures designed to record and analyse
past fraudulent activities with a view to enhancing the initiatives in
place to prevent further fraudulent impact.
Parts 2 and 3 of this book are devoted to outlining the points I have
outlined above in greater detail.
How we achieve this, however, is through the use of Risk Management.
What is Risk Management?
A good definition of risk is:
'The possibility of loss, injury, disadvantage or destruction.'
Manage, according to the New World Dictionary, is defined:
'v.t. to guide or handle with skill or authority; control; direct.'
Management is the noun. So Risk Management could be defined as:
The practice with processes, procedures, methods and tools of
handling, of controlling risks in a
project or activity, function or business with a view to the
reduction of those risks to an economically
acceptable level.
Risk Management provides a disciplined environment for proactive
decision making to:
· Assess continuously what could go wrong (risks).
· Determine which risks are important to deal with.
· Formulating strategies for reducing those risks.
· Implementing the strategies to deal with those risks.
· Recording and maintaining information for management analysis.
This includes identifying a concern that could translate into a
potential risk. What activities could constitute a risk in your
business? Could it be the fact that you accept credit cards on line?
Could it be the level of service you are offering your clients? Is
there a potential problem with the products you are offering? What
level of Quality Management do you employ? How responsible are your
staff in dealing with clients and/or products?
· Determine which risks are important to deal with.
Identifying concerns are an important factor and precede identifying
risks as to potential and consequences. The options for assessing the
risks need to be employed and priorities should be set. Some risks may
be relatively low priority. Such as the risk of a client complaining
about waiting 5 minutes on the phone to speak to someone. But the risk
of a fraudulent credit card being used to purchase a 500-dollar item may
be quite high. This is something you will need to make a serious
assessment on.
· Formulating strategies for reducing those risks.
From this risk management plans and procedures may be developed and, if
needs be, presented to senior management for authorisation. What
policies and procedures do you need to put into place to reduce the risk
of say … the 500-dollar credit card fraud?
· Implementing the strategies to deal with those risks
Having a process or procedure in place which the company and it's
employees follows. This might be a verification process for credit
cards for example. Or it could be an investigative procedure for a
complaint about the company products or service.
· Recording and maintaining information for management analysis
A record of activities and results of the risk management undertaken for
effective analysis and control and future accuracy of risk management is
vitally important. Is there some policy you need to formulate as a
result of a particular complaint or fraud that took place and which
illustrates a deficiency in the quality of product or service or the
security arrangements?
Risk Management therefore is the route by which you discipline yourself
when it comes to dealing with complaints and fraudulent activity. The
guidelines outlined here give you a framework you may use to formulate
effective strategies...'
For more information visit www.goldcenturypress.com
kind regards,
Michael
@fastmail.fm
http://gold-today.com
http://goldcenturypress.com
http://www.ksw-club.com
http://mikemoore1.plugusin4cash.com/
---
You are currently subscribed to e-gold-list as: [EMAIL PROTECTED]
To unsubscribe send a blank email to [EMAIL PROTECTED]
Use e-gold's Secure Randomized Keyboard (SRK) when accessing your e-gold account(s)
via the web and shopping cart interfaces to help thwart keystroke loggers and common
viruses.
