We now live in a society where acts of fraud are common-place and the effects of fraud can be felt by many people in many different situations. Where fraud is concerned, businesses and the work-place can be a very vulnerable place and therefore measures to protect a business or corporation against fraud has never been so important.
When fraud counter-measures fall short; in order to limit loss, or recover assets, the investigative process must then take over.
Investigation Methods
There are two different ways that a fraud investigation can start. The first type of investigation commences when an actual fraud has been uncovered, and maybe one or more offenders are identified. The second type of investigation starts with a strong suspicion of fraud, but no substantial proof that a fraud has taken place.
Both types of investigations are important to anyone that takes the prevention of fraud seriously. Companies with good anti fraud protocols actively keep an eye on their systems and investigate questionable financial activity. It is definitely worth bearing in mind that the first investigation method should never be seen as any less important than the second method.
Red Flags
There are many red flags or signs that can indicate the possibility of fraud having been perpetrated. Hundreds of different fraud schemes exist, so the number of possible warning signs of fraud is immense. It would be a mammoth task to cover them all in this blog, but some general indications of fraud can be applicable across all types of business and fraud schemes.
Employee Education
It is important to educate management and employees on these warning signs of fraud. Historical studies indicate that reports from employees are one of the most frequent methods by which corporate fraud is uncovered. Therefore, it makes perfect sense that corporate entities and businesses need to fully educate employees about the indications and warning signs of fraud so they can then form an important part of a corporate intelligence cycle in order to combat this insidious and economically damaging activity.
Related articles
- BMJ declares MMR study ‘an elaborate fraud’ — autism claims likened to ‘Piltdown man’ hoax (eurekalert.org)
- Financial fraud hits 23-year high (go.theregister.com)
- Nearly two dozen arrested in insurance fraud scheme (latimesblogs.latimes.com)
- A true story of fraud and corporate culture that has implications for us all (normanmarks.wordpress.com)
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