Hotel Fraud: Opportunities Galore
One of the leading reasons that hospitality companies experience high levels of fraud is that the industry's culture tends to focus much more on providing better customer service than on the internal financial controls that go into running a hotel. Superior customer service equals higher profits! The hotel general manager spends more of his or her time meeting and greeting guests than monitoring the operational details of the hotel. Technology is wonderful, but provides the appearance that the system takes care of everything, when if fact most details are hidden from view and often never reviewed leaving the door open for fraud.
Top hotel fraud threats: - Bogus travel agencies - Phantom employee - "Comp" fraud - A/R misappropriation of payments - Guest refund & adjustments fraud - Inventory theft - Credit card fraud by employees
The important lesson here is that properly designed internal controls can never be tight enough in a hotel. Dishonest employees and guests seem to always find new ways to steal. Often going on for months or years undetected.
While customer service is truly the ultimate priority, neglecting anti-fraud controls is bound to shrink the bottom line and keep hard-earned revenues from flowing to the bottom line. A simple solution is to bring in a third party professional once or twice a year to keep your hotel on track!