Small Businesses In Greater Danger Of Fraud

Tough economic times mean an increase in fraud against small businesses, which frequently lack rigid accounting controls. Earlier this month, a former financial manager of the Ann Arbor Amateur Hockey Association was charged with embezzling more than $937,000 from the organization, which had been stockpiling money to build a new ice arena.

The theft was discovered by bank officials, who informed the association of the suspected fraud. Kimberly Knight is accused of transferring the money from the association’s account to one of several personal accounts she had opened in her maiden name. The money was spent on lavish gifts, vacations, a luxury SUV and to help support a failing family construction business.

The organization’s experience is typical of small businesses that have been the victim of internal fraud. Often, the business is unaware of the theft and may even close in a downturn, never realizing that fraud, and not the economy, is responsible for their failure.

In the case of the AAAHA, the money that was stolen was intended to build a new facility, not to fund the club’s operations. No employees have been laid off as the result of the theft and the organization’s overall finances are still sound.

Many small businesses find out too late, however, that their operating cash has been taken, and must make the difficult decision to close. Even when no fraud is involved, sometimes cash flow is a problem, especially in a recession. Recovering from such an event or making up cash shortages can be very difficult, but temporary cash flow problems can often be addressed with a merchant cash advance. A merchant cash advance is the ideal solution for businesses that need cash fast, for whatever reason.

With a merchant cash advance, you can use your future credit card sales to put cash in your bank account right now. If your US-based business accepts Visa or MasterCard, and has at least $2,500 in credit card transactions each month, your business will likely qualify for a merchant cash advance. There are no questions to answer about how you plan to spend the money, and applying for a cash advance is simple. Even businesses with less than perfect credit can get cash fast, often within 72 hours.

Don’t wait! Address your cash needs now with a merchant cash advance from Rapid Capital Funding!

Photo Credit: Cameron H.

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