Fraud Hotlines: Don't Miss That Call

Tip lines are one of the most effective tools organizations possess for detecting and preventing fraud. Fifty-nine percent of forensic and valuation CPAs participating in the AICPA's 2011 Forensic and Valuation Services Trend Survey said internal whistleblower hotlines would lead to improvements in preventing fraud in the next two to five years. Internal tips were cited by business and industry CPAS participating in the same survey as the most common detection method for frauds that occurred at their organizations. This article lays out a path for maintaining a tip line, including key features and best practices teamed by public companies. It concludes with a description of different levels of service provided by web-based tip line providers, including features and estimated costs. The overwhelming evidence in support of tip lines has spawned the development of several third-party tip line options.