Fraud prevention, fraud detection, and investigation are approaches used by organizations to mitigate losses from fraud.

Why fraud prevention is more cost-effective than fraud detection or investigation?

Reason - Fraud prevention is more cost-effective than fraud detection or investigation:

"Prevention is better than cure" - Prevention of fraud reduces the cost that the investigation or detection of fraud incurs losses.

The fraud preventive measures that can be taken by the company are as follows,

Identifying the sources Measuring risks Implementing detective controls Employing external and internal auditors (to issue independent checks based on the performance)

The managers and the employees of the business entity are the persons who likely detect the fraud. So, it is important that they are been educated regarding the prevention and monitoring of the fraud prevalence and fraud handling measures.