Joseph R. Dervaes, CFE, CIA
All Wired Up: Electronic Funds Transfers are Prime Fraud Targets
Theodore Swaggen was above reproach. This eight-year employee of a major Midwest bank, had won the trust of his coworkers and supervisors. But as the supervisor of the bank's wire transfer room, Swaggen handled ridiculous sums of money. He decided it was time to get his hands on some of it; $68.7 million to be exact.
Written By: Joseph R. Dervaes, CFE, CIA
Examining fraud and abuse in trade-skill education programs
This column discusses some of the special situations of examining trade-skill education programs.
Written By: Joseph R. Dervaes, CFE, CIA
Raising frauds, not funds
This column is the first in a three-part series presenting many scenarios of fraud and abuse in student fundraising activities.
Written By: Joseph R. Dervaes, CFE, CIA
Raising funds, not frauds
Article giving recommendations to avoid fraud and abuse in all types of student fundraising activities,along with several cases
Written By: Joseph R. Dervaes, CFE, CIA
Missing Disbursement Documents (Part 2)
Part two of a two part series on missing disbursement documents is concluded by discussing alternative procedures you can use to determine if the transactions were made to valid vendors for authorized business purposes.
Written By: Joseph R. Dervaes, CFE, CIA
Checking Account Fraud: When Employees Steal (Part 6)
Employee fraud often involves checking accounts and businesses need to take steps to prevent disbursement fraud.
Written By: Joseph R. Dervaes, CFE, CIA
False or Altered Disbursement Documents (Part 1)
This column, the first in a series of three, begins a discussion about some of the most common issues fraud examiners face when they detect false or altered documents in the organization’s disbursement records.
Written By: Joseph R. Dervaes, CFE, CIA
Bank Reconciliation Process
Proper reviews of bank reconciliations can prevent or detect check fraud by employees.
Written By: Joseph R. Dervaes, CFE, CIA
Checking Account Fraud: When Employees Steal (Part 7)
This column underscores the importance of reviewing the volume of activity in small checking accounts, and it also offers lessons from the past – what fraud examiners can learn from actual case histories.
Written By: Joseph R. Dervaes, CFE, CIA
Using an Organization's Credit to Commit Fraud, Part 1
We begin this three-part series with employee abuses of general organization credit cards.
Written By: Joseph R. Dervaes, CFE, CIA
Phoning it in: Employee phone fraud and abuse
Overview and case histories outlining phone fraud and abuse
Written By: Joseph R. Dervaes, CFE, CIA
St. Valentine's Day massacre (revisited)
Part 2 of an article about a false billing scheme case study
Written By: Joseph R. Dervaes, CFE, CIA
St. Valentine's Day Massacre (revisited)
Case study of a false billing scheme.
Written By: Joseph R. Dervaes, CFE, CIA
Bank Reconciliation Process
One of the oldest home-improvement companies in Washington had bad news for its 210 employees: they wouldn't be receiving holiday bonuses. The owner discovered that an accountant had embezzled $1.2 million in five years.
Written By: Joseph R. Dervaes, CFE, CIA
Small Organizations Need Internal Controls for Cash Disbursements: Part 3
This column, part 3 of 4, proposes steps that an independent volunteer should take to monitor the cash disbursement function of small organizations. Fraud examiners can also use the columns in this series as a checklist for all types of organizations, regardless of size.
Written By: Joseph R. Dervaes, CFE, CIA
Bank Reconciliation Process
Part three in a three part series. A case study involving dealing with outsider threats in the bank reconciliation process
Written By: Joseph R. Dervaes, CFE, CIA
Bank Reconciliation Process: Dealing With Outsiders' Threats (Part 2)
Check fraud will occur in your organization - it's not a matter of if but when. So make sure your organization not only has excellent internal controls but a companion program to monitor those controls to deter and detect fraud.
Written By: Joseph R. Dervaes, CFE, CIA
Cash larceny, part six: Alteration of accounting documents in imprest fund accounts
This column continues our discussion about cash larceny frauds. Here we'll discuss fraud in advance travel funds.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny, Part Five: Alteration of accounting documents
Unscrupulous cashiers often prepare false accounting records or alter these documents in cash receipting operations to conceal a misappropriation of funds from their employers. The next three columns present fraud cases that illustrate some of the common alterations of accounting records I've encountered in my practice.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny, Part Eight: Cashier manipulations of manual and computer cash register systems
As we continue our discussion of cash larceny frauds, we begin to look at manual and computer cash register manipulations that cashiers use to misappropriate funds from the organization.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny, Part Seven: Alteration of accounting documents in imprest fund accounts (continued)
Almost all organizations use a petty cash fund to disburse funds to employees who make miscellaneous purchases on their behalf. This column demonstrates some of the ways that employees commit petty cash fund fraud.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny, Part Four: Alteration of manual cash receipt forms
Unscrupulous cashiers often alter manual cash receipt forms for customer payments to misappropriate funds from the entity. These manual cash receipt forms usually come in a book with three or more receipts to a page.
Written By: Joseph R. Dervaes, CFE, CIA
Living the Good Life: Case Study of Another Authorized Maker Scheme, Part 1
This article discusses the finer points of fraud deterrence and detection for authorized maker schemes.
Written By: Joseph R. Dervaes, CFE, CIA
Traveling in High Style on the Organization's Dime, Part 2
Every employee has the opportunity to commit travel fraud.
Written By: Joseph R. Dervaes, CFE, CIA
Traveling in High Style on the Organization's Dime, Part 3
Part 3 of a series outlining travel fraud
Written By: Joseph R. Dervaes, CFE, CIA
Traveling in High Style on the Organization’s Dime, Part 1
There are many travel fraud schemes, and we’ll try to cover a variety of them in this and the next two columns.
Written By: Joseph R. Dervaes, CFE, CIA
Living the Good Life! Case Study of Another Authorized Maker Scheme, Part 2
This column discussing an actual authorized maker scheme investigation, including elements of the fraud, the red flags, some additional detection techniques and information about the interview.
Written By: Joseph R. Dervaes, CFE, CIA
Fraud and abuse in school cafeterias
The policies and procedures for managing food service operations vary from state to state. Thus, fraud examiners in other U.S. states and in other countries should research the rules and regulations that apply to these activities for the guidance needed to investigate them.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny (Part 11): Fictitious Void Transactions on Type 2 Cash Registers
Processing fictitious void transactions is a common type of cash register manipulation that cashiers use to misappropriate funds from their organizations. This article describes frauds committed on type 2 cash registers - registers that do permit voids to be recorded during normal transaction processing.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny (Part 9)
One of the most basic cash register frauds involves losses of revenue associated with missing Z tape numbers. This article instructs fraud examiners on how to calculate the amount of loss from missing cash register Z tapes and provides lessons from cash register manipulation schemes that cashiers use to misappropriate funds.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny, Part 12
This column summarizes key points about cash larceny frauds and provides fraud examiners with a checklist to use during cash receipt testing.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny, Part Ten: Fictitious Void Transactions on Type 1 Cash Registers
Processing fictitious voided transactions is a type of cash register manipulation that cashiers use to misappropriate funds from their organizations. This column provides tips for preventing and detecting fictitious void transactions on type 1 cash registers.
Written By: Joseph R. Dervaes, CFE, CIA
Small Organizations Need Internal Controls, Part One
This column stresses the importance of monitoring the internal control structure in small organizations and recommends the use of volunteers to do the monitoring.
Written By: Joseph R. Dervaes, CFE, CIA
Weights That Don’t Measure Up (Part 1)
This column outlines a false billing scheme case study involving the Washington state Liquor Control Board.
Written By: Joseph R. Dervaes, CFE, CIA
Weights That Don’t Measure Up: False Billing Scheme Case Study (Part 2)
This column discusses the investigation, lessons learned, and recommendations to prevent future occurrences of false billing schemes.
Written By: Joseph R. Dervaes, CFE, CIA
Stop, Look, and Listen
Skilled fraud examiners should make it a habit to stop, look, and listen for red flags when communicating with staff.
Written By: Joseph R. Dervaes, CFE, CIA
Laundering stolen checks: Skimming revenue, part two
In the January/February 2005 issue, we began a discussion about the primary method I've seen where the highest-risk employee skims revenue from the organization using a check-for-cash substitution scheme. This column continues the discussion on employees stealing checks from the organization.
Written By: Joseph R. Dervaes, CFE, CIA
Skimming revenue, part four: Stealing cash payments from customers
In the past three columns, we've discussed many ways fraud perpetrators steal currency and checks from organizations before accountability for the transactions has been recorded in the accounting system. This column concludes this brief coverage of skimming cash payments from customers.
Written By: Joseph R. Dervaes, CFE, CIA
The highest-risk employee: Skimming revenue, part one
With this column, we begin a journey through the many facets of cash receipting and types of fraud that occur in every organization. Our first step involves skimming: removing funds prior to recording accountable transactions in the accounting system.
Written By: Joseph R. Dervaes, CFE, CIA
Cash Larceny, Part One: No fixed responsibility losses
With this column, we begin a new series about cash larceny - on-book frauds in which employees steal the organization's revenue after accountability for the funds has been recorded in the accounting records.
Written By: Joseph R. Dervaes, CFE, CIA
Stealing cash payments from customers: Skimming revenue, part three
Here we'll discuss some of the methods employees use to skim funds by stealing customer payments made in cash.
Written By: Joseph R. Dervaes, CFE, CIA
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