Embezzlement is an all too common problem for companies, big or small. But what can those smaller companies, with less resources, do to protect themselves? Several WNYers say they have come up with a solution.
It's called "FiduciaSoltuions" and it is an automated fraud-defense system.
"You can pick up the paper almost on a daily basis and find instances of people embezzling money," Dan Barry, the managing director of FiduciaSolutions, said. "And it occurs more often than not in the non-profit sector [like] social organizations, youth baseball, youth sports teams."
Barry, along with his two business partners Jim Healy and Dan Verrico, said larger companies have resources to perform checks and balances that can prevent embezzlement and fraud.
But small companies are not able to adopt the same anti-fraud controls. That was the case, they said, until now.
"We are the first line of defense," Jim Healy, Vice President of New York and Canada, said. "We're the ones who come in there, go through your system, we show you this is where you're going to be stolen from and we tell you this is how you're going to fix it."
Healy says audits are not enough. According to the Association of Certified Fraud Examiners, the typical organization loses five percent of revenues to all types of fraud each year.
"Audits don't stop money from being stolen," Healy explained. "It accounts for the money as soon as it gets in to the bank account and when it gets out."
FiduciaSolutions goes beyond that. Through their website, a company registers, each employee takes a survey, FiduciaSolutions compiles the responses and compares them to a best practice model.
Then, they pinpoint any variances and deliver a report.
FiduciaSolutions said their system analyzes the day-in-the-life of every dollar in the company. And they do all of this at an affordable cost.
"Our pricing structure is a sliding scale," Dan Verrico, VP of Sales and Marketing, said. "We run from as little as $2,500 up to $50,000 depending on the size and scope of the surveys that we do and the size and scope of the organization."
They check in annually, too. Plus, they provide an ongoing, anonymous tip-line to report fraud. They said a big aspect of fraud prevention is perception of detection.
An accounting firm might do all this but at a higher price.
FiduciaSolutions is automated and therefore a cost savings to the organizations.
"What we do is really a win for everybody because we're preventing bad things from happening and at the same time, we're making sure that more money gets from the donor to the mission," Verrico said.