Op-Ed: Join the team to fight fraud in 2020
We’re all constantly complaining about the problem of corruption in Puerto Rico. This epidemic affects us all. A dollar that is stolen or wasted in government, is money that does not reach schools, hospitals, police or roads.
We all pay that one. We can’t stand it anymore.
But corruption is a disease that not only affects the public sphere but is easily spread in private enterprise. Unfortunately, fraud and corruption permeate everywhere.
In these times of economic difficulties, we see that there are a series of pressures on business and people to survive this situation. In many cases, unscrupulous individuals want to obtain wealth or advantages by violating the laws and taking gain based on the abuse of the trust of their victims. I invite you to meditate on this. This journey is crucial.
I invite you to place yourself in the world of corruption. Are you a perpetrator or a victim? Few or none will admit to being corrupt. Those will use euphemisms to justify their actions (“That is the way business is done.”)
Most will say they are victims of public corruption. However, they are excluding themselves from being victims with private corruption. The loss in government affects us all as we said before, but when the loss of fraud is private it affects us too.
The reason is very simple, we consume goods or services all the time. The cost of fraud is passed on in the prices of goods and services. This comes at the cost that companies must bear for losses and for the acquisition of control measures.
On one side, the cost of doing business is expensive and on the other it raises the prices of things. Fraud makes our lives more expensive. Again, we all lose.
If you are an employee of a company that suffers fraud, you will see its growth limited by these events and possibly its survival. If you are the owner, your costs increase, your profit is reduced and reinvestment, expansions or any development goes away from your economic reality. If the business closes, we all lose, there are no jobs, the government does not collect, and the competition and variety of goods and services is reduced.
With this assessment on hand, we know where we stand. My invitation is not to sit idly by. We must win this war. We cannot be spectators and complain. We must be proactive in the fight against fraud wherever it is.
The culture of “the wise guy” must be eliminated in Puerto Rico. That’s the reason for my invitation. We want to clean the government, but in the elections, we vote for those who have shut up or looked aside when corruption is in their party. In the same way, we want to win in any way, when that gain represents a loss for someone.
My invitation to join this team comes in several levels. At the islandwide level in 2020 we must look at how we clean the house and how we get out of stagnation and bankruptcy. We must vote intelligently. That is the first obligation.
The second is to look at how we deal with fraud and corruption at our companies and jobs. Fraud should not be swept under the carpet. It must be studied, researched and made public. This publicity is not for a warning, but a way to examine methods, controls and what is effective in discovering and preventing them.
In addition, it is to carry the message that: “IN THIS COMPANY THERE IS ZERO TOLERANCE FOR FRAUD.” Loud and clear. Those who are morally weak in the face of temptation should know that they will be discovered, held accountable and prosecuted. Impunity must end at all levels.
The corrupt politician, the dishonest employee and the “wise guy” have to be convinced that the situation changed for them and that we are vigilant. We will not tolerate one more “deal.”
Companies must step up sophistication in hiring
On a private level, companies must become more sophisticated on their hiring, processes and controls. The latest Fraud study of the Puerto Rico College of CPAs showed that the vast majority of those who perpetrate fraud on the island do so because they have the opportunity to do so.
This means that they steal because the good, service or advantage is within their reach and the company has not been effective in creating controls. The best comparison is that you leave the door of your house open every night. It is a matter of time before a thief opens it for the opportunity.
Entrepreneurs and their employees are required to improve controls. If you have no idea, there are professionals who can analyze these situations. Prevention is better than working in the sad situation of having a fraud event without knowing who committed the fraud or how we can prevent it from happening again.
That’s why I invite you to examine that it is vulnerable, establish controls, report what is wrong. The invitation has been extended. Action on your part is the only thing missing.
