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DETECTION
Detection is an important concept in fraud Initial Detection of
investigation because the speed with which Occupational Fraud
fraud is detected—as well as the way it is The foundation to effective detection
detected—can have a significant impact on of occupational fraud is knowing the
the size of the fraud. It is also key to fraud most common methods by which fraud
prevention because organizations can take is discovered. Despite the increasingly
sophisticated fraud detection techniques
steps to improve how they detect fraud, which available to organizations, tips were the
in turn increases the staff’s perception that most common way occupational frauds
fraud will be detected and might help deter were discovered in our study by a wide
margin, as they have been in every one of
future misconduct. Our data revealed several our previous reports. As shown in Figure 9,
notable trends relating to how fraud is initially more than 40% of cases in our study were
detected, when it is detected, and who de- uncovered by tips, which is almost three
tects it, all of which can help fraud examiners times as many cases as the next-most-
common detection method. Therefore,
improve the effectiveness of fraud detection processes to cultivate and thoroughly
and prevention at their organizations. evaluate tips should be a priority for fraud
examiners.
18 Detection Report to the Nations
