Trésorier/Treasurer magazine - N°91 - Oct/Nov/Dec 2015 - (Page 29)
FORUM
HOW CAN TREASURY
MANAGEMENT
DEPARTMENTS
EFFECTIVELY
COMBAT
"CEO IMPERSONATION"?
In a way, the company as a whole can by
protected by placing importance on its
corporate governance.
A corporate world can prove hostile
Companies have to face a large number of
threats; besides those of corruption and
cybercrime, cases of fraud involving the
impersonation of the CEO have shown an
upward trend. Since 2006, a few hundred
of French companies have dared confess
to being victims of this kind of scam.
The losses suffered by corporates are
estimated to be over €400 million. The
impact can be substantial and that it is of
paramount importance to protect oneself.
In total, 77% of companies state that they
have suffered at least one attempted fraud
over the last 12 months of business activity; meanwhile, 20% failed to prevent all
such attempts1.
However, there are measures for
thwarting these attempts. A reliable
information system should be implemented alongside steady internal control
mechanisms. For this, the assistance of
the Legal Department is crucial because
the implementation of such mechanisms
requires a structured legal framework
in order to reduce risks and provide the
best solutions to managers without any
expensive slowdown in the company's
activities.
What is "CEO impersonation"? What
methods are used by the con artists?
What should we do when dealing with
potentially fraudulent activity? These
questions must be addressed by the
whole company so as to be fully informed
and aware of such fraud. In fact, human
intervention, often coupled with internal
control mechanisms, is the reason for
over 80% of all fraud prevention1. Therefore, it is essential that secure internal
procedures are adopted and that any
urgent demand not respecting these procedures is carefully examined. The Financial Departments of subsidiaries ought to
be the first to have their attention drawn
to this threat because they are generally
targeted the most, given their direct relationship with the banks and their geographical remoteness from the Executive
management. Moreover, it has proven to
be just as necessary to sort the information according to the business, adopt a
governance of information system identifying the most sensitive data and ensure
limited publication of such information.
- OCT
The control of information as the
first line of defence against fraud
N°91
A reliable information system
should be implemented
alongside steady internal
control mechanisms.
-
In an increasingly complex, digital and
globalised business world, large groups
and SMEs must face new challenges inherent in organisational, legal and financial
constraints, which can curb or hinder
the smooth functioning of their business.
With this in mind, developing Corporate governance best practices becomes
essential to ensure an efficient and sustainable business that creates value and
is adapted to all its stakeholders. At the
same time, it fosters the compliance and
consistency with changes in regulations
and internal statutory as well as ethical
principles.
Urgent wire transfers, changes to the
bank account details of suppliers, fake
payment orders, there are various
methods but the scam usually begins
with identity fraud. Believing that the
instructions are from upper management and pressured to act quickly and
confidentially, the employee carries out
the ordered transaction, oblivious to the
deception, and unwittingly assists in
the theft of thousands or even millions
of euros. Worse still, in the rare cases
where the fraud is foiled, some scammers
impersonate the fraud squad and call the
actual group CEO and request that the
bank transfer be carried out in order to
"help trap the scammers"!
LE MAGAZINE DU TRESORIER / TREASURER MAGAZINE
Corporate governance
providing universal protection
/ NOV / DEC 2015
"CEO impersonation" is a real threat for companies. How can fraud be recognised and thwarted?
How can Treasury management Departments foil these attempts by means of controlled
management of Delegation of Authority?
1 . Source: Euler Hermes
29
Table of Contents for the Digital Edition of Trésorier/Treasurer magazine - N°91 - Oct/Nov/Dec 2015
Cover
Table of contents
EDITORIAL
FINANCIAL HIGHLIGHTS Luxembourg Tax News
INTERVIEW Ben Poole Editorial Services
FOCUS
To What Extent Should Treasurers’ Activities be further centralized?
Capital Markets Union (CMU)
Upsurge in fraud
FORUM
CEO impersonation
Using analytics to cope with uncertainty and volatility for treasury
IFRS 9 : Nécessite d’une reorganisation bancaire majeure
Taux zéro : de nouvelles stratégies pour un nouveau monde
Investing surplus cash in repos
Warranty & indemnity insurance
CORPORATE FINANCE
Making the switch from Excel to a Treasury System
Corporate treasury in the digital age
Fini le casse-tête des paiements internationaux pour les entreprises !
Bank Independent Cash Pooling
Gérer l’offre de retraites : un choix complexe pour l’entreprise
15 MINUTES AVEC CIAM
THE FINANCIAL RISK OBSERVATORY
NEWS
LIFE BEYOND NUMBERS
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