Category: Fraud
Advanced Inventory Concepts
November 11, 2019A company files a claim contending a warehouse manager stole $450,000.00 in inventory. The manager, a long-time employee, was trusted with keys and alarm codes. He was able to enter the warehouse after hours and remove pallets of product. The company contends the theft occurred over a 12-year period. When confronted with an inventory loss claim, what do we do to test the reasonableness of missing inventory? The Rate of Theft A common, core concept involves evaluating an employee’s theft…The Computer Fraud and Abuse Act
March 4, 2019In 1986, U.S. Congress enacted the Computer Fraud and Abuse Act (CFAA), The CFAA was enacted to combat various types of “computer crime.” The Act criminalized, among other things, the act of intentionally accessing a computer without authorization. In 1986, this meant “hacking or trespassing into computer systems or data.” The CFAA has been expanded and amended multiple times, as legislators attempt to keep pace with rapid advancements in technology and ingenuity. Defining the Crime The CFAA criminalizes the following:…Unusual News
February 11, 2019Employee theft and employee dishonesty cases can follow similar patterns. Employees often steal merchandise, cash, or make personal purchases using company credit cards. But some cases stand out either because of the amount of loss or the method of misappropriation. Here are five over-the-top examples of in-house theft and employee fraud: The Jury Duty that Wouldn’t End Joseph Winstead, a Washington, D.C. postal worker, managed to steal $40,000.00 in unearned wages from the USPS over a total of 144 days.…Recent Ruling: Medidata Solutions, Inc. v. Federal Ins. Co.
November 7, 2018The case Medidata Solutions, Inc. v. Federal Ins. Co. involved a fraudulent impersonation scheme and an alleged entry into the insured’s computer system. The case involved a series of events seen all too often. The court’s ruling presents a peek into the intricacies of analyzing coverage in traditional computer fraud claims. It is important to understand the difference between loss resulting from social engineering schemes and computer hacking. Losses involving social engineering do not require a hacker gaining unauthorized access.…Computer Fraud Trends
October 18, 2018Since May 2000, the FBI’s Internet Crime Complaint Center (IC3) has received more than 4 million complaints. Incidences of internet crime are steadily increasing. In 2013, IC3 received 262,813 complaints, with a reported loss amount of $781.8 million. In 2017, IC3 received 301,580 complaints, with a reported losses of $1.4 billion. Tracking the Trends IC3 tracks the latest trending scams each year. In 2017, Business Email Compromise (BEC), Ransomware, Tech Support Fraud, and Extortion topped the list. BEC, Confidence/Romance Fraud,…Would Your Employees Pass This Test?
September 29, 2018No company wants to become the next Sony or Target. Hacks affecting high-profile companies have caused major headlines and businesses have become increasingly wary. Data shows phishing emails are often the entry points for hackers. Employees who click on links in scam emails could potentially unleash malware or provide access to fraudsters. Canada ranks second worldwide for hosted phishing sites, ahead of Egypt and Russia. In past years, companies’ tech gurus handled cyber issues. Now high-level management is involved. While…Scratch & Scam: Lottery Losses
August 13, 2018At today’s convenience stores and gas stops, customers can fuel their cars, pick up a quick snack or cup of coffee, and take a chance at winning millions. Convenience stores and gas stops make a steady income from the sale of lottery tickets and online lottery sales. The lottery sales are also a draw to bring customers to the stores so customers will make other purchases while in the store. Just as customers are drawn to the thrill of the…Scientia Potentia Est (Knowledge is Power)
July 18, 2018The 2018 Global Study on Occupational Fraud and Abuse is hot off the press – and it’s an important resource for anyone interested in occupational fraud. The report includes valuable information on how fraud is committed, how it’s detected, who commits it, and how organizations can protect themselves. Compiled by the Association of Certified Fraud Examiners, this year’s annual report examined 2,690 cases in 125 countries across 23 industries. The results are in and here are a few key takeaways:…Contacting the Police
June 7, 2018A recent study by the University of Cincinnati found 64% of small businesses surveyed to have experienced employee theft. The study surveyed 314 small business owners in Cincinnati in a range of industries: finance and banking, manufacturing, service, and restaurant and retail. Despite the high number of incidences of employee theft, only 16% of those businesses reported the incident to the police. The Reasons Why don’t small businesses report employee theft? The reasons vary, but they’re important to understand in…Non-Profits – Easy Targets for Fraudsters
May 1, 2018Caring Hands was a non-profit organization providing mental health care and substance abuse rehabilitation services in Pennsylvania. Ms. Graham, one of Caring Hands’ social workers, visited clients’ homes to provide social services for families and children. Ms. Graham would compile case notes and information for families and children and submit timesheets to Caring Hands; Caring Hands, in turn, would bill the Pennsylvania Medicaid program. Caring Hands’ IT department was testing employee data and found personnel records for Ms. Graham did…