This Is Bad: What To Do If Your Business Is The Victim Of Investment Fraud

Law Blog

If you run a business, fraud is the last thing you want to find in your ranks. Fraud means that someone you once trusted has sought to do you financial damage. Fraud can destroy your businesses financial status, and your reputation. If you suspect fraud, it's crucial that you act fast. Dragging your feet, or postponing positive action can further destroy your business, and make it nearly impossible to recover from the devastation. Here are four of the most important steps you can take when you suspect fraudulent behavior within your business ranks.

Seek Immediate Legal Representation

If you suspect fraud, the most important step you can take is to seek immediate legal representation. If you suspect that the scheme involves stocks, and other investment securities, you'll need to hire an attorney who's experienced in securities law. Investment fraud is much too serious to trust to someone who doesn't have the necessary experience to find the discrepancies, and protect your business accounts.

Begin a Thorough Investigation

Once you've secured legal counsel, you'll need to begin a thorough investigation. The longer you take to begin your investigation, the more serious the situation becomes. First, each day the fraudulent actions continue, the more money you're losing. Second, the longer you take to begin the investigation, the more comfortable the guilty parties become, which could create a situation where they increase their fraudulent activities. Protect your business by conducting a thorough investigation immediately.

Don't Share Too Many Details

Once you begin your investigation, you'll want to maintain a level of discretion. While it's okay for your employees to know that you're in the middle of an on-going investigation, you don't want them to know in which direction the investigation is taking you. In fact, letting your employees know details about the investigation could cause the guilty party to cut their losses and run. If that happens, you might lose your opportunity to catch them in the act of fraud.

Tighten Access to Important Information

As soon as you know that your business has become the victim of fraud, you'll need to lock down all your vital information. Reduce the number of people who have access to certain information. If you pinpoint the person, or persons, responsible for the fraud, begin gathering information as quickly as possible. This should include making copies of all your employee hard drives. This will ensure that you have the necessary information before they decide to wipe the information off their own computers.

If you've been the victim of investment fraud within your own company, don't wait to act. Use the information provided here to stop the fraudulent activities before they can destroy your company. Contact a legal firm, like Carter West Law, for more help.


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