How to Prevent Timecard Fraud

Avoiding timecard fraud at staffing agencies often comes down to understanding the factors that cause it in the first place. There are common factors among staffing firms that fall victim to the practice, so by understanding what those are, and identifying them early, you can minimize the chances of fraud occurring.


In tough economic times, when money is often hard to come by, the temptation for an employee to take a chance and file false information on a timecard can become too much for some to resist.


Here are four ways to help prevent timecard fraud in your staffing firm.


Don’t let a crisis distract you

If you’ve had a number of situations where it was all hands on deck to solve a major problem with a client, you may be putting yourself at risk for being a victim of fraud. When things become chaotic in the workplace, routine matters get less attention than normal because you’re focused on solving the major problem.


The safeguards you put in place to regularly survey clients about employee performance, audit usage of the printer or fax machine or analyzing timesheets to make sure everything is being filled out accurately, often aren’t done because those tasks don’t seem important when your biggest client is upset.


You can’t afford to cast aside these valuable practices when a problem occurs. Stay diligent; otherwise, you may find your next problem is just around the corner.


Avoid complacency

Smaller staffing firms can be especially vulnerable to the practice of timecard fraud because they operate in a culture of trust and close relationships. If people believe they have earned the trust of management and that no one would ever suspect them of committing fraud, it could lead to a problem.


This is not to suggest that you begin a witch hunt, but be careful and avoid getting complacent about how finances are handled in your staffing firm.


Make it clear who is responsible for monitoring items such as timecards. But don’t delegate that responsibility to just one person; instead, alternate between two or three. Create an environment that doesn’t allow people to think they could get away with committing fraud.


Take action when it’s needed

If you come across clear evidence that someone has been submitting a false timesheet, you need to address it. If you determine it wasn’t an innocent mistake but a purposeful effort to commit fraud, punish the person and let others know that such behavior will not be tolerated.


The best deterrent to preventing fraud is to make sure people know that you’re on top of things in your staffing agency and that you’ll respond when needed. It protects you and your corporate culture.


Work with your people

When you or your business is going through a difficult period, you may not be able to offer the raise that your people really need. But if you show that you’re taking steps to get the firm to better times, you lessen the chances that someone will consider stealing from you.


Stealing is never OK, no matter what type of firm you run or what type of culture you maintain. But the more you appear to be understanding and empathetic to what your people are dealing with, the less likely they’ll want to do something to hurt your business.