Factors Leading to Hotline Distrust

Fraud is detected through tips more than any other method, making hotlines one of the leading anti-fraud controls. More than 39 percent of whistleblowers used telephone hotlines, and more than half used email or a web-based form to report their complaints/tips.

However, a lack of trust can affect an organization’s ability to obtain tips through a hotline. According to the Association of Certified Fraud Examiners, deploying a quality program and establishing a positive tone from leaders are critical for an effective hotline program.

According to a recent article in Fraud Magazine, here are some of the top factors leading to hotline reporting system distrust:

  • Employees don’t understand the system
  • Lack of personalization for an employee’s concern
  • Improper handling and lack of training
  • Hotline management
  • Too many reporting mechanisms
  • Overemphasizing “credible” complaints
  • Obstacles of negative incidents and retaliation
  • Relying on actions speaking louder than words

And here are some tips for building a trusted hotline program:

  • Training and awareness
  • Good communication
  • Access
  • Transparency

By being aware of hotline reporting trepidations and striving to build a trusted program, organizations can help prevent fraud.

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Todd has more than 20 years of experience providing client solutions in consulting, accounting and tax matters. He has performed business valuations for a variety of purposes, including gift and estate tax, business planning, succession planning and for solvency purposes in bankruptcy. Todd is experienced in providing expert testimony, and his assistance with litigation matters includes reconstruction of financial records, tracing of transactions, damages analysis and valuations related to shareholder disputes and solvency analysis in bankruptcy and for marital dissolution.

Todd Burchett – who has written posts on BKD Forensics.


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