Arizona Attorney - February 2015

You work hard to build your assets.

It’s important to be aware of the common types of personal and business fraud, and the best ways to protect your assets.

JOE EPPS, CPA/CFF/ABV, CFE, CVA, PRESIDENT

EPPS FORENSIC CONSULTING PLLC

Please call or email me directly with your questions regarding this article or to discuss your financial expert witness needs.

480.595.0943, jepps@eppsforensics.com

How to Protect Your Personal and Business Assets

www.eppsforensics.com One very secure way to protect assets is to pay off debt; particularly credit card debt.

Secure Way to Protect Assets

If we use our savings to pay off debt, we receive an immediate return on that investment with no risk.

An article in Yahoo Finance indicated that the average credit card interest rate is almost 15%. This means that paying down credit card debt could provide an effective return of 15%. There is likely no investment we could make that would provide us a guaranteed 15% return with no risk.

Higher Returns Bring Higher Risk

While paying down debt is an effective and totally secure way of invest-ing our money, many would like to earn a greater return. However, higher returns bring higher risk. In the quest for higher returns on investments, we may turn to opportunities presented outside publicly-traded stock or bonds. When we do so, we are at risk of falling prey to fraud.

Tips to Avoid Fraud:
n Often the investments that
promise;the;most;pay-off are
also the most attractive for
fraudsters.
n Get the details in writing.
Legitimate companies will be
happy to provide all the infor-
mation you request.
n Don’t agree to anything on the
spot. Pressure to act immediately
is a danger sign of fraud.
n Do your homework. If you don’t
understand how the investment
will make money, as well as the
risk to what you expect to earn
and the risk of losing part or all
of your investment, don’t make
the investment.
n Testimonials from strangers
about a great investment
opportunity may actually be
con artists trying to lure you
into an investment scam.
n Be especially wary of invest-
ments in commodities. Crooks
often promise that the value of
investments in coins, precious
metals, artwork, oil leases, gem-
stones, and other commodities
will rise. The truth is that the
value of these types of invest-
ments can go up or down
significantly.
n Be especially cautious about
emails for investments. Many
unsolicited emails are fraudulent.

Small Businesses Victimized the Most

Fraud impacts individuals of all economic levels and businesses of all size. The tips provided above are focused primarily on individuals. However, owners of small businesses must be particularly careful.

According to the ACFE 2014 Global
Fraud Study, small businesses (fewer
than 100 employees) were victimized
in the greatest percentage of report-
ed fraud cases. The average overall
impact was in excess of $150,000.

How to Minimize Fraud Risk

The best strategy for a small business to minimize fraud risk is to speak with their CPA or another professional who understands internal accounting controls and fraud risk. Even the smallest business can take steps to minimize the potential to be defrauded.

Avoiding Payment Fraud

Small businesses are particularly susceptible to payment fraud, which can take many forms. It commonly involves one of these three tactics: an employee forging a signature on a check; an employee issuing improper checks for their own benefit; or the establishment of a fake vendor.

Lessening payment fraud risk can be achieved by the owner simply looking at canceled checks, especially checks that appear unusual and checks for new vendors. The fraud deterrence is achieved in part by making sure employees with access to checks and the books know that the owner is looking at the checks. Make it a point to ask some questions. The specific questions do not need to be about suspicious payments; the point is to keep the employee aware that the owner is reviewing the checks.