North Texas Dentistry Volume 9 Issue 4 2019 ISSUE 4 DE

fraud alert THRIVE SAFELY Watch out for fraud! The cost of fraud is staggering. The median loss from a sin- gle dental practice employee fraud case is $150,000. The largest we discovered in Texas was more than $715,000. The statistics are astounding! The concealment methods we have found most prevalent in a dental practice are: n n n n n n n Altering physical documents: 48% Creating fraudulent transactions in accounting: 42% Altering transactions in the accounting system: 34% Altering electronic documents or files: 31% Destroying physical documents: 30% Creating fraudulent electronic documents or files: 29% Creating fraudulent journal entries: 27% by Richard V. Lyschik, DDS, FAGD, CFE Observing how thousands of practices operate across the country, we have noticed some very clear trends that are becoming more obvious with every month that passes. We have found there to be two distinct groups in dentistry. There are those who are thriving in practice, and there are those who are trying to survive in prac- tice. Thriving practices have written policies and procedures in place; training, testing and per- formance reviews; and a responsible and accountable team spirit. Fraud has no home in a thriving practice! Dentists used to make lots of money just showing up at the office – they did not need to know how to run their business. They let others handle the practice details. Times have changed. Some will also say, “People have changed too!” Dentists are now fully exposed to the exact same challenges that every entrepre- neur has to deal with in a growing business, and the fraud that accompanies every business. A thriving dental practice is 51% business, and 49% technical. 20 NORTH TEXAS DENTISTRY | www.northtexasdentistry.com Fraud is now so common that its occurrence is no longer remarkable, only its scale. A 2017 EY study shows relaxed atti- tudes towards unethical behavior and a tendency to treat fraud- ulent activity as acceptable norms in the workforce – particularly among younger generations. The study further reveals that 73% of respondents from younger generations jus- tify unethical actions! But let’s not pick on a particular genera- tion. We shouldn’t judge individuals based on their generation, but on their merits. But the statistics speak for themselves. The potential for unethical behavior in our dental profession is on the rise. It is time to add anti-fraud training to your practice. The least expensive way to find out your practice’s vulnerability is to have a Fraud Prevention Check-up. Most practices score very poorly because they don’t have the appropriate anti-fraud and HR con- trols in place. It’s like finding out you have seriously high blood pressure. It may be bad news, but not finding out can be a lot worse!

North Texas Dentistry Volume 9 Issue 4 2019 ISSUE 4 DE | Page 20