On the Frontlines: Remote Worker Fraud

However, among the pro and cons of remote versus in-office employment, we also have to consider the risk of fraud.

If you hire someone for a hybrid position and they come into the office regularly, you can probably be fairly sure that the job is being performed by that employee, despite some days working at home. However, when you hire someone that you (almost) never see at the office, how can you verify who is doing the job?

Most articles that cover remote work and risk are looking at the risk that a remote employee has an unsecure work environment and could become the victim of a cybersecurity incident. But what about an employee committing a type of fraud by not actually doing the work?

Consider this scenario: A company employee, let’s call him Enzo, works remotely. Suddenly, his boss is fired, and Enzo’s workload is double what it was before. After a time, Enzo contacts his ex-boss and offers him the opportunity to complete part of his tasks under-the-table or for a sub-contracting fee, without the company’s knowledge. Then the ex-boss finds a new permanent job and Enzo again has a mountain of work. So, Enzo searches for another support person and finds a young, brilliant student to help. Then the young student finishes her university program and is hired, so Enzo turns to artificial intelligence (AI) to provide him with the support he thinks he needs so as not to drown in the workload.

What is the risk from the company point of view? How would you feel if you didn’t actually know the person (or AI) with whom you are working and sharing business information?

Another risk is a phenomenon called “overemployment,” a scenario in which one person holds two or more full-time, remote jobs simultaneously. And it's a growing trend: There are sites and platforms offering tips and support for employees dabbling in the art of overemployment. You can probably already imagine how to manage online calls simultaneously — such as using an avatar or keeping one’s video off during a Teams meeting. Other tactics suggest ways to delay one project while focusing on another.

One website, Overemployed.com, has 300,000 members on Discord and Reddit, according to Business Insider. Members swap success stories and advice. Perpetrators of this type of fraud include employees who are disillusioned with their corporate lives, ones with very lucrative job offers they find hard to reject, or others with a concrete financial goal in mind — be it early retirement or buying a house.

As internal auditors, we have to make our companies aware of the risk and highlight employee red flags, such as:

• LinkedIn profiles that are not properly updated, for example, displaying the message, “Open to work,” rather than reflecting the name of the company where they work.
• Consistently keeping one’s camera off in meetings (although this alone is not a reason to suspect someone is not doing their job).
• Consistently slow response times on tasks and via email.
• Conversely, having an unrealistic workload, yet completing work very quickly (which could mean the employee is using another source).
• Being frequently late to or absent for meetings with no explanation.
• Having previously worked for very large companies where it may be easier to hide inactivity.

While the presence of one or even several of these red flags may amount to nothing, it may be worth further investigating the situation when two or more are present and something seems off.

Keep in mind that an employee who is overemployed is different from a contractor, who might be expected to cobble together more than one job — or even a full-time employee moonlighting or freelancing for extra money — unless that is explicitly prohibited by the employer.

The quite different scenario of someone who is sharing work with a subcontractor or even working for a competitor means there is a conflict of interest in terms of time and resources and possibly issues involving intellectual property, privacy, or company secrets. Ultimately, an employee who “cheats” on their employer by stealing time away and focusing on another job — or shifting work to a subcontractor — may not be trustworthy as an employee.