(South Africa)


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Scam - bookkeeper fraud

If you've been in business for a while, the chances are you've come across persons of debatable moral standing who have tried to steal some of your hard earned money through fraud or con tricks. We will periodically publish examples of these scams on this page in an effort to make you the small business owner aware of them and hopefully prevent you from becoming a victim. The business world is competitive enough for us not wanting our meager profits being stolen by con men. The new scams will be featured in our newsletters so we strongly recommend that you register for the newsletter so that you don't miss any. Information is power.

The "friendly book keeper" fraud.

 How it works: When most of us start out our businesses we are too busy to worry about the mundane stuff like accounts.  We need to sell, service customers, collect payments, improve products, increase productivity, reduce defects.  The day is a whirlwind and there is no time, and even if there was, we don't really have the inclination to get stuck into boring accounts.  

Our solution: we employ someone as our book keeper and they take over the finances. In principle this is good. Our time is freed up and can now be spent on far more productive tasks that result in increased income for our businesses. After a while we rely more and more on our book keepers and they get given more and more responsibility. Sales are booming, but profit is marginal, so we work harder. Then one day a year or two down the track, we either stumble across it by accident or the liquidators inform us of it: The book keeper has been siphoning funds from our accounts.

 There are many many ways. Creating false creditors, duplicating payments , etc. Our employee has slowly but surely  taken money from us. We never checked so they took more. We trusted them, but money can do strange things to people. It was so easy.

 How to prevent it: 1) Always spend some time reviewing your accounts each month. Do random checks to try and pick up irregularities. This means that you need to have a bit of an accounting back ground so take a basic book keeping course. Even if its only an hour a month, do the checks ... it may save your business. 2) Only allow business owners or partners to sign cheques or release electronic payments, never the accountant or book keeper. You still need to run checks though as you need to verify that the accounts and payments are correct.

The subject matter dealt with on this site is of a general nature only. It is always advisable to consult a professional for your specific situation. All information provided on this site has been carefully chosen and is to the best of our knowledge correct and current. If however you find errors, broken links or disagree with facts provided, please contact us at so that we can make the correction and provide South African business owners with relevant and error free factual information. If you believe there is relevant content missing and you wish to add this value to the site, then you can contact us at the same address

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