Page 8 - Risk Management Bulletin Jan- Mar 2021
P. 8

RMAI BULLETIN JANUARY TO MARCH 2021


                 o   A little over a year after starting at Goldman  Examples of Fraud: Asset Misappropriation
                     Sachs, she began forging her bosses'                               o Theft of cash
                     signatures on personal cheques to make                             o False payment
                     payments into her own accounts. Realizing                            requests
                     she had got away with it, she continued to                         o Cheque fraud
                     steal money by issuing forged cheques and                          o Billing schemes
                     making false money transfers.
                                                                                        o Misuse of accounts
             In any business, the risk of fraud can be reduced.                         o Inventory and fixed
                                                                                          assets
             Internal control measures can particularly reduce the
             "opportunity" angle of the Fraud Triangle.                                 o Procurement
             X   Final Conclusion on the Case Study:                                    o Payroll
                 o   After four years of siphoning off vast amounts                     o Improper revenue
                     of money, she was eventually caught when                             recognition
                     her boss at the time decided to make a six-                        o Misstatement of
                     figure donation to his former college. He took                       assets, liabilities
                     a look at his bank accounts to see if he could                       and/or expenses
                     cover the donation and was astonished to find
                     the balance on the accounts become so little.                      o Other accounting
                                                                                          misstatements
                 o   He investigated further and realized that large
                     sums had been transferred to an unknown                            o Falsified
                                                                                          employment
                     account.
                                                                                          credentials e.g.
                 o   Secretary was the obvious suspect. By this
                                                                                          qualificationsand
                     time, she had actually stolen around £3.3                            references.
                     million
                                                                                        o Other fraudulent
                                                                                          internal or external
             Fraud Classification/Categories:                                             documents
             Fraud is classified under different categories as under:


                                                   Types of Fraud


                                                            Broad
                                                            Categories





                           Asset                            Financial
                           Misapproptiation                 Statement                      Corruption
                                                            Fraud



                                   Non                             Non             Conflict       Bribery &
                    Cash                            Financial                      of
                                   Cash                            Financial                      Extortion
                                                                                   Interest


                                                  Fig. 3 - Types of Frauds





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