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BUSINESS: Business Hijackings

 





Recent Gauteng Business News

According to Moneyweb the Minister of Trade and Industry, Rob Davies, indicated that 10 companies have been ‘hijacked’ at the Companies and Intellectual Property Commission (CIPC) since August. Davies highlighted that business hijackings occur when the list of directors for a company is fraudulently changed. The new “directors” can use their false titles to steal money from the company, from SARS or from financial institutions. It is only possible to hijack a company with the help of a member of the CIPC staff, or when the CIPC fails to do its due diligence to authenticate changes in directorships.


Dave Loxton, head of the forensics practice at Werksmans Attorneys, gives the following advice to companies wishing to strengthen their business defences against white collar crime, including business hijacking:


How To Prevent Business Hijackings


Do proper screening of all new hires: Never employ a person just because someone you know recommends him or her. Word-of-mouth referrals are not good enough. Only a proper forensic check will reveal hidden secrets such as insolvency or falsified qualifications.

Go the extra mile to follow up CV claims: Prospective employers definitely need to follow up with previous employers and to make direct contact with people listed as references on CVs. Even this may not be enough, however. Some white collar criminals will go to extraordinary lengths to give credence to their claims. An example is the legal advisor at a South African corporate who claims to have graduated from the law school of an Ivy League university. He conspired with a genuine graduate to borrow the latterÂ’s identity. The deception is only apparent on close inspection of the class photograph.

DonÂ’t be dazzled by fame and fortune: DonÂ’t automatically believe someone just because they are well known and well-connected in business and politics. Check them out too.

Stay in touch with lower-level employees: Employees at the lower levels of an organisation tend to be extremely well-informed about the goings-on within the business. They can be especially attuned to any hint of irregularities in the higher ranks.

Knowing Your Way Around You Own Business Can Stop Business Hijackings


According to Loxton, one of the most effective ways to fortify a business against white collar criminals is to stay close to employees and customers. “Being visible and creating a good sense of your identity are important because people will then intuitively question anomalies that, left unattended, could create loopholes for white collar crime and specifically business hijackings.”


 
 
 
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