What does an effective fraud prevention program typically require?

An effective fraud prevention program typically requires ongoing training and active monitoring because these components are essential in creating a vigilant and informed workforce. Ongoing training ensures that employees are aware of the latest fraud schemes, understand their role in prevention, and know how to report suspicious activities. This knowledge is crucial, as fraudsters often adapt their techniques, and a well-informed staff can recognize and surface potential issues before they escalate.

Active monitoring complements training by ensuring that organizational processes and controls are being followed and that irregularities can be detected quickly. This may involve regular audits, transaction monitoring, and assessments of compliance with policies designed to deter fraud. Together, ongoing training and monitoring create a proactive approach to fraud prevention, building a culture of integrity and accountability within the organization.

In contrast, options involving increased funding for marketing, rarely implemented policies, or minimal employee engagement do not contribute effectively to a robust fraud prevention strategy. Marketing expenses do not address internal controls or fraud awareness, while poorly implemented policies undermine the effectiveness of guidelines designed to mitigate fraud. Additionally, minimal employee engagement can lead to a lack of awareness and accountability, making it easier for fraudulent activities to occur without detection.