Use these six tips to minimise ghost employee fraud

Simangele Mzizi, Fsp Business, 23 Oct. 2014

Tags: ghost employee fraud, payroll fraud, tips to minimise ghost employee fraud

Payroll fraud is rife in South Africa.

Last week, we reported that research done by Alexander Forbes indicates that payroll fraud costs South African businesses more than cash-in-transit heists.

That’s a scary statistic.

One method of payroll fraud that’s popular is ghost employee fraud.

This is when an employee adds a fake employee to your payroll. As a result, you end up paying a salary to an employee who doesn’t exit. Over the long run, it could bring your company to its knees.

To ensure your employees don’t rob you blind, use these five tips to minimise ghost employee fraud in your workplace.

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Reduce ghost employee fraud with these six tips

According to an article on, as the global financial turmoil intensifies organisations are striving to eliminate all unnecessary expenses. Yet, without knowing it, many are falling prey to ghost employee fraud. It eats into their payrolls and negatively affects the bottom line.
While the nature of this deception and the numbers involved vary depending on the size and nature of the company, the important point is you must take steps to reduce this type of fraud in your workplace. And you can do just that by using these tips:
Tip 1: Implement a customised payroll system that’s been designed by professionals who are skilled, focused and equipped to handle the complexities of remuneration, taxation and administration.
Tip 2: Segregate the duties of payroll preparation, authorisation and distribution.
Tip 3: Use electronic payslips that are linked to an in-house email address.
Tip 4: Use electronic transfers rather than cash or cheque payments.
Tip 5: Check for anomalies such as invalid ID numbers.
Tip 6: Always get skilled professionals to review your payroll system.
Using these six tips will help you minimise ghost employee fraud in your workplace.
PS: We strongly recommend you check out The Essential Fraud-Proof Business Guide. It will help you deal with all aspects of fraud from online payment fraud, financial statement fraud to other fraud schemes that pose a risk to your business.

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