A fraud and abuse hotline can save your business money. An Association of Certified Fraud Examiners survey found that 40% of frauds are detected via ethics hotlines, enabling organizations to discover fraud in half the time and reduce losses by 67%.
That’s what prompted Ioana Ben-Ezra, corporate controller for Diversified Restaurant Holdings, Inc., to hire Ethical Advocate (EA). EA established an anonymous, confidential incident reporting hotline serving DRH’s 45 locations.
Team members troubled by an activity or wanting to offer feedback or suggestions create a unique username and password and file an anonymous report via the website, or use the anonymous hotline to call in an incident for investigation. This enables them to provide tips without fear of reprisal. EA also provided all implementation training as part of the service.
“We’ve had reports filed—which is to be expected with an employee base of about 2,200 people—and it’s working,” Ben-Ezra notes. “People are using the system and no one has had any complaints about how it’s working.”
A former auditor with Deloitte & Touche, Ben-Ezra says a confidential incident reporting solution is a must-have for any organization. “I’d recommend it to anyone,” she said. “Ethical Advocate is easy to learn and use, and it’s low maintenance. Every company should have it—for risk mitigation—but also for the health of the company.”
In fact, research shows that companies using hotlines create a more accountable and efficient environment that can actually outperform less ethical companies. The 2011 World’s Most Ethical Companies continue to beat the S&P 500, earning returns above 40% in 2011 versus just under 10% for the S&P.
Contact us to learn how fraud and abuse prevention and detection can help you make and save money.