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What is 'buddy fraud' and how can you avoid it?

Supplier: Mitrefinch Australia
15 February, 2017

Buddy fraud is the act of colleagues inputting pin codes or swiping cards to ‘clock in’ (or out) on behalf of their friends and thus avoid managers noticing lateness,early leaving or flat out absences.

Buddy fraud (or buddy clocking or buddy punching as it sometimes also called) is the act of colleagues inputting pin codes or swiping cards to 'clock in' (or out) on behalf of their friends and thus avoid managers noticing lateness, early leaving or flat out absences.

The costs of repeated lateness and absenteeism can add up quickly. For example, suppose a company has 400 staff and 5% of them (20 staff) are always 10 minutes late for work. If their average hourly pay is $25.00, then the 10 minutes of missed work is worth $4.16. That still might not sound like much money, the situation starts to look much worse when you consider that with 232 working days in the year, the total cost to the company for ten minutes lateness for 20 employees adds up to a staggering $19,302.40.

Despite this, many Australian firms are still not addressing the buddy fraud issue adequately. It could be due to a lack of awareness of the costs and dangers (consider an emergency where staff need to be accounted for quickly) or sometimes a simple unwillingness to confront offenders and call them out on their behaviour.

The good news is that there are a number of ways decision makers can act to prevent buddy fraud.

Installing a Mitrefinch biometric time and attendance system is by far the best, simplest and most economical way to stop fraud. The clocking device works by taking a scan of an employee's fingerprint, and converting it into data which means it is not only impossible for others to clock in for you, but employees' privacy is maintained.

In addition, businesses can also consider the following:

  • Carry out regular, random checks of departments within your firm to discourage buddy fraud
  • Conduct internal time and attendance audits where you scrutinise data carefully for any errors or inconsistencies
  • Create and publish an employee code of conduct which specifies your company's stance on buddy fraud