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Recently, there has been some rustling from lawmakers and others that indicates a serious money laundering threat might be upon us: decentralized digital currencies.
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Data analytics -- the practice of assessing bodies of business data to identify potential indicators of fraud -- is slowly, but surely, becoming a mainstay of the fraud fighter’s professional repertoire.
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Greg Smith, the former Goldman Sachs (GS) executive who hammered his former employer in The New York Times in mid-March, inadvertently did a great service to senior management everywhere.
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Immigrant communities have proven to be particularly vulnerable to fraud due to the cultural and language barriers faced by their populations. Within the past few years, the U.S. government has recognized a surge in immigration services scams.
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This ACFE exclusive video features an interview with Vincent Walden, CFE, CPA, as he explains text mining and other concepts in data analytics.
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The ACFE Advisory Council is a council of fraud-fighting experts dedicated to the improvement and growth of the ACFE.
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The circumstances surrounding the dramatic downfall of Peregrine Financial Group (Peregrine)—one of the largest independent U.S. futures brokerage firms—and its sole owner and chief executive, Russell Wasendorf, illustrates the important role of asset tracing and recovery in fraud cases.
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Denise McClure, CFE, CPA, is president of Averti Fraud Solutions, a forensic accounting firm that "follows the money” in criminal and civil matters, while also helping organizations improve internal controls. McClure remembers when her father, "an honorable, trusting small business owner, was victimized by morally flexible employees.
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Health privacy violations are lethal. They can create reputation management nightmares and generate stiff fines. Even a single HIPAA violation has serious financial consequences.
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Unfortunately, customer reviews might not be as reliable as once thought. There is mounting evidence that a substantial portion of customer reviews are not real, and instead are created by someone with an undisclosed relationship to the seller or the product.
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The Security and Exchange Commission’s (SEC) Dec. 3, 2012 lawsuit against the Big Four accounting firms and BDO (a “second-tier” firm) got a few brief headlines, but not the kind of attention that should have been attracted by a move that could result in serious penalties for the defendant firms.
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Peter Davis serves as managing director at Simon Consulting, where his projects include receiverships over Ponzi schemes, alter ego analyses, fraud investigations, lost profit and earnings calculations, lost asset searches and other matters.
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“Mining social media for clues is one of the fastest-growing areas of insurance-fraud investigation. (For example), workers compensation investigators might find that a supposedly injured employee is bragging about hang gliding and is posting action photos on Facebook.” -- James Quiggle, Coalition Against Insurance Fraud.
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As of June 2011, the Social Security Administration now administers Social Security numbers randomly. Prior to this change, Social Security numbers were based, at least partially, on the geographical location of the recipient.
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The Supplemental Nutrition Assistance Program, or SNAP, began as the Food Stamp Program (FSP) in 1939, and was set up to aid hungry low-income Americans during the Great Depression. In 1964, FSP got a makeover and adopted a way to get much-needed food to these Americans, a mechanism that became more commonly known as “food stamps.”
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In the last month or so, several reports and surveys have been released with predictions about the “fraud outlook” for 2012.
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As more and more fraud migrates from traditional techniques to those exploiting the Internet, institutions and individuals are increasingly at risk of victimization.
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As the world gears up for another exciting celebration of athletic prowess, the criminal underworld is preparing to take advantage of our collective jubilation and the anticipation of the Games.
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According to a recent study on Insider Threat conducted by the Ponemon Institute, organizations suffer an average of more than 52 incidents of insider fraud annually. Traditional security controls, such as application logging, are often powerless in these situations.
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Was fraud somehow involved in the massive headline-making trading loss at JP Morgan Chase?
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Telecommuting programs present obvious questions for both salaried and hourly workers: are the employees actually working when they claim they are, and are they as productive as they would be in the office environment?
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According to Connecticut-based forensic accountant and investigator Stephen Pedneault, CPA, CFE, many internal control designers and fraud experts over-think potential fraud scenarios during their risk assessments.
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Sarah Vandersnick, CIA is an internal auditor for Think Mutual Bank in Rochester, Minn.
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Organizational management increasingly needs to understand and mitigate its risks effectively to ensure long-term success. Effective risk management requires, among other things, a comprehensive and ongoing set of tools and processes to handle the dangers associated with third-party relationships.
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In all business entities, cash is a high-risk asset and vulnerable to fraud. Having controls in place and ensuring employees their compliancey with them is of top priority.
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Many social media users are connected to people they have never met or barely know, and now these so-called friends and connections not only have access to your personal information, but they also have the ability to send you personalized and private messages.
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Major accounting frauds – and the new rules that followed -- set Patrick Brogan, CFE, CPA, CIA, down the path to becoming a Certified Fraud Examiner. Brogan is president of PBC Global, a firm that specializes in internal audit, compliance, accounting and reporting specialists.
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Long before Senator Paul Sarbanes and Representative Michael Oxley took it upon themselves to craft a federal law designed to thwart mega-accounting frauds like those at Enron, Tyco and WorldCom, a respected, retired Judge in South Africa named Mervyn King was hard at work fashioning a set of standards aimed at enhancing corporate board, audit committee and internal audit influence over governance and risk mitigation... including fraud risk.
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With the holiday season on the horizon, fraudsters worldwide are clamoring for the opportunity to take advantage of unsuspecting merchants, consumers and donors.
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Why an impulse reaction is rarely the best strategy
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The Sarbanes-Oxley Act (SOX) of 2002 imposed many new corporate governance provisions for public companies.
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It was during her college undergraduate study that Ashley M. VanDenTop, CFE, became interested in fraud.
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Folks in the fraud-fighting business rightfully complain about the large number of fraudsters who are: Never prosecuted; given a “slap on the wrist” by the criminal justice system; allowed to walk around freely until they’re brought to justice.
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The rising popularity of online pharmacies in today’s economy provides a new channel that is vulnerable to fraud. Pharmacies operating through the Internet offer convenience, low prices, and privacy.
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There is no substitute for hands-on experience in fraud examination. This reality has helped guide David Wilson, CFE, in his career and is also a key piece of advice he imparts on others looking to enter the profession.
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A recent report in the academic journal mBio concluded that fraud in the scientific community is significantly more likely to be perpetrated by men than women.
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Heather S. Rogers, CPA, juggles many roles: She is an associate professor of accounting and chair of the economics and business department at Whitworth University, as well as head of her own private CPA practice.
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It is a question frequently asked by management, boards of directors and audit committees, but the response given may not necessarily be the same in each organization. Are we looking where the fraud is?
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David Crump, CFE, CFI, is currently working in Afghanistan for Engility Corp. as a law enforcement professional assigned to a U.S. Army battalion. His job is to advise, mentor and train U.S. soldiers and leaders in law enforcement, evidence handling and collection and rule of law.
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Leadership at SAC Capital Group (SAC) is accused of creating a culture that encouraged the use of non-public, material information in the pursuit of high returns. And those returns have indeed been high — nearly 30 percent over the last 20 years, some of the best in the hedge fund industry.
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In the ongoing battle against financial reporting fraud, the Securities and Exchange Commission (SEC) is employing technology in a way that is making waves in Wall Street circles – enough so that, according to a recent Forbes article, a key tool in the SEC’s approach has been given a nickname: RoboCop.
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The recent news that the passwords and login credentials for approximately two million online accounts were stolen and posted online serves as a reminder of the importance of password security. The stolen credentials were for all kinds of user accounts, including those on Facebook, Google, Linkedin, Twitter, Yahoo and ADP payroll services.
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In our September edition, The Fraud Examiner presented “Are Your Travel Expenses Monitored?” by Misty Norris-Carter, CFE, CIA. In response to that article, our guest writer submits his experiences at Mayo Clinic regarding the implementation of data mining processes to monitor travel.
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Simon Markham, CFE, is a fraud investigator for UK-based mobile phone operator EE, Ltd. in Duxford, Cambridgeshire.
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It must be year-end house-cleaning time, because we read every day about companies writing off huge amounts of goodwill that originated from an earlier acquisition.
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The institution of marriage has long been a sacred ritual between two people in love; however, even this sacred institution is vulnerable to fraud.
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Lawsuits and divorces have a strange effect on people. When faced with a big financial loss, otherwise honest and trustworthy people will begin to hide assets and lie about their cash.
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What CFEs and their organizations should know about zombie armies and robot networks.
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In the rush to embrace developing technologies, organizations and their employees often unwittingly increase the risks of data loss. The convergence of cloud computing and powerful employee mobile devices means the goals of securing sensitive data and maintaining regulatory compliance are becoming more difficult.
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Being a successful fraud fighter means staying on the cutting edge of the newest techniques and emerging best practices in prevention and detection. At the 24th Annual ACFE Global Fraud Conference, expert presenters brought timely fraud issues to the fore and explored ways in which fraud examiners can best be equipped to deal with them.
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Born and raised in Singapore, Ng Siew Kwan, CFE, CIA, came to the United States for an education in finance, beginning a path that would lead him to a career in fraud examination.
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“Anyone in our field or a related occupation knows how difficult it is to get information needed to make assessments or improvements,” said Seham S. Carson, Manager of Internal Controls & Accounting Policies at Bristow Group Inc., in Houston, Texas.
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Dennis Dycus, CFE, CPA, CGFM, is director of the Division of Municipal Audit for the State of Tennessee Office of the Comptroller of the Treasury. In a recent Q&A with the ACFE, he provides his insight on fraud investigation from the government agency perspective.
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While media and public attention has been focused on disaster-related frauds, data protection and privacy, and tax avoidance, a recent workers’ compensation scandal involving a contestant on the U.S. game show The Price is Right serves as a reminder that insurance fraud schemes continue to pose significant threats to public and private interests.
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Mandy was a superstar. For my client, a nearly century-old private school, she was much more than the bookkeeper.
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The clock is ticking to file 2012 income tax returns in the U.S., and if you haven’t filed yours yet, you might not want to wait around too much longer. Filers have bigger things to worry about than whether they’ve maximized their refund; specifically, the threat of someone stealing their identity and filing their tax return before they do.
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Jeffrey W. Brend, J.D., CFE, is a forensic divorce attorney who has been featured in Fortune magazine, Newsweek, and on the Sky Radio Network as one of America’s Premier Lawyers.
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Over the past 15 years I have witnessed the gradual emergence of an investigation industry in China which began from crude anti-counterfeit outfits and family investigation agencies and gradually extended to the more sophisticated areas of due diligence, fraud investigation and forensics, as well as compliance and FCPA investigations.
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Fraud examiners, whether working in law enforcement or the private sector, know that their investigations can benefit from the vast amount of data stored by Internet service providers (ISPs). User-created content such as photographs, messages, and personal status updates help examiners discover motives, incriminating statements, conflicts of interest, and much more.
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As the vice president and head of anti-fraud and corporate governance, Guiseppe Tritto knows how wide fraud investigations can span. From Miami to Vancouver, Tritto supervises and monitors all corporate and investment banking anti-fraud efforts in North America for BNP Paribas.
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Jill Battley, CFE, serves as divisional director for Haymarket Risk Management, where she investigates fraud and implements measures to detect and prevent it.
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Due to its skyrocketing value over the past year (from around $10 per bitcoin in November 2012 to over $300 per a year later), Bitcoin has been gaining popularity beyond just the tech community.
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What some might find surprising, though, is the level to which cyber fraud/cyber crime continues to flourish today, roughly 20 years after the beginning of the Internet revolution. In fact, if many experts are correct, it is actually increasing considerably.
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Uncovering fraud requires a highly honed set of skills that combines both the art of knowing how to find patterns and using technology to do the heavy lifting. Consider your own credit card bills.
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Do you think that your dedication to finding fraud could ever interfere with your ability to properly conduct a fraud investigation?
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Disability fraud costs companies billions of dollars per year and, as seen recently in U.S. headlines, can be as far reaching as the judiciary.
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As a world traveler, Catherine Samaras, CFE, CA, CIA, has seen quite a lot. While every new destination provides a learning experience, so do many of the things she has witnessed in the business realm.
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In 1985, a casual conversation between accountant-turned-FBI agent Dr. Joseph T. Wells, CFE, CPA, and Dr. Donald Cressey, the foremost criminologist in the country, planted the seed for what would become the world’s largest anti-fraud organization.
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Have you ever wondered, “Are my travel expenses being reviewed?” Fraudsters who have been successful at defrauding companies through the submission of fictitious travel expenses most likely have.
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Private investigator Eli Rosenblatt, CFE, knows that some cases are more difficult than others. In some of the most confounding investigations, “you're so often digging for information that's just not there, and waiting for some nugget to be revealed,” he said.
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April 2014 By Mark Scott, J.D., CFE On February 12, 2014, the National Institute of Standards and Technology (NIST) released the “Framework for Improving Critical Infrastructure Cybersecurity” (Cybersecurity Framework), a tool designed to establish a baseline of security best practices that organizations can use to measure and mitigate cybersecurity risks.
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April 2014 ACFE Member Profile Maria Kress, CFE, serves as an investigator with the Office of the Inspector General (OIG) for the Los Angeles Unified School District. From watching crime dramas on television and becoming an undercover store detective, to her current role unraveling fraud cases using investigative skills, surveillance and other means, Kress has found a fulfilling career in the fight against fraud.
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When you are alleged to be deeply involved in the largest known Ponzi scheme in history, professed ignorance is not an acceptable defense.
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Ashley Koroluk, CFE, CAMS, is an Investigative Financial Crime Analyst for the Royal Canadian Mounted Police (RCMP).
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August 2014 By Jaime deBlanc ACFE Research Editor For five years, a group of scientists at Iowa State University had been hot on the trail of a scientific breakthrough: a vaccine for the HIV virus. Their initial results showed that rabbits treated with the vaccine developed antibodies to HIV — an incredibly promising outcome, since it suggested that a human vaccine could also be created.
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August 2014 By Scott Patterson, CFE The message is finally getting out: Tipsters may be the most unheralded front-line soldiers in the fight against fraud. More frauds are detected through tips than any other method. This has been consistently shown in the ACFE’s biennial Global Fraud Study, and the newest statistics from the 2014 Report to the Nations on Occupational Fraud and Abuse further reinforce the point. Businessweek and other major media outlets are reporting on it, too – many of them making note that other, long-depended-upon anti-fraud controls (such as external audits) are coming up short compared to tips. It is news worth sharing, as the implication is that the “see no evil, hear no evil” approach that many businesses followed for decades is now truly obsolete. To catch fraud, one must see it and/or hear about it. Then one must speak about it. “That’s great,” your executives or clients might say upon hearing this news. “So, why aren’t our phones ringing?” If only it were that simple.
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By Scott Patterson, CFE December 2014 It’s been more than a decade since a slew of large accounting scandals rocked the financial world, including Enron, WorldCom and Tyco, among others. Enron in particular grabbed the nation’s attention like few cases before it: The tale of hubris, cover-ups and, sadly, financial ruin for many of the corporation’s employees and shareholders was splashed across news networks and journals worldwide. It was a case study explored in bestselling books and film, galvanizing public sentiment into a chorus somewhere along the lines of: “How could this happen?”
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ACFE Member Profile December 2014 Siward De Vries, CFE, CBM, does not consider himself a “natural” when it comes to fraud examination. “I am a Dutch economist,” De Vries points out. “Most of my career in the European Investment Bank (EIB) in Luxembourg, I spent in lending operations, including 10 years in charge of operations in Asia.” In 2002, however, De Vries was asked to establish a fraud investigation program within the EIB. He knew he had to build his anti-fraud expertise.
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By Mark Scott, J.D., CFE December 2014 A recent data breach involving Coca-Cola Enterprises Inc. highlights a threat faced by almost every organization: lost or stolen laptops can result in devastating data breaches. A data breach is an incident that involves the loss, theft or unauthorized access of sensitive information.
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Sarah Victoria’s application claimed that she had a degree from a reputable university, extensive experience in the field and no criminal record. What she failed to mention is that she previously spent time in jail for theft, has terrible credit, and never finished her degree from said university.
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Corruption poses a serious threat to business interests worldwide. While bribery and other fraudulent acts continue to have significant impact on the global marketplace, measures to combat them, including the Foreign Corrupt Practices Act (FCPA) and the UK Bribery Act, have changed the landscape considerably and are causing corporations to reassess their controls and due diligence.
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Laura Davies is a fraud risk management consultant for KPMG, LLP, in London. In her career as an anti-fraud professional, Davies has a focus on fraud vulnerability and risk assessments, internal controls and investigations.
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For years we have been warned about the threat of identity theft and the need to protect our personal information from those who seek to misuse it; however, the same emphasis has not been placed on business identity theft.
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Crowdfunding has become a hot topic among investors, regulators and fraud examiners as the phenomenon has gained traction over the last few years.
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Before even graduating from college, Tyson Johnson, CFE, CPP, VP of Business Development at BrightPlanet in Ontario, had spent hundreds of hours conducting surveillance, performing interviews, writing reports, conducting undercover investigations, and even testifying in court.
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Douglas Lowe, CFE, has served as Anderson County (Texas) Criminal District Attorney for 16 years. Prior to that, he was in private practice in Palestine, Texas as a certified personal injury trial lawyer.
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July 2014 By Laura Hymes, CFE If you met Theresa Caputo, the first thing you’d probably notice is her gravity-defying blonde hair, her distinctive voice or maybe her long nails if you shook hands. Whether you would notice a psychic energy surrounding her is a more subjective observation.
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July 2014 By Scott Patterson, CFE You have been toiling for months on a case and you know where the evidence is leading. The satisfaction of solving the puzzle and unraveling the trail of fraud is what a fraud examiner lives for.
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June 2014 The Fraud Examiner During a fraud investigation, there are many factors that make a successful interview. Careful preparation, timing, choosing the right setting and tone are all important aspects to consider before sitting down with an interview subject.
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LaToya Lacey, CFE, CPA, Global Audit & Risk Director at Diageo has climbed her way to a position that leverages all of her learned and innate skills: delivering internal audits, communication, leadership and applying the knowledge gained from fraud training and education.
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June 2014 By Zach Capers, CFE Last month, the U.S. Department of Justice, in concert with authorities from the UK, Australia, Japan, Germany, France and the Ukraine, disrupted a massive botnet named Gameover Zeus that had been the primary distributor of the notorious CryptoLocker ransomware.
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Storing your photos, videos, documents and other information in “the cloud” sounds rather benign, to some degree – it conjures up light, airy thoughts of data at your fingertips, floating where it is easily accessible.
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Fraud prevention measures are valuable to all organizations. Yet, how much fraud prevention is worth — March 2014 By Misty Norris-Carter, CFE, CIA
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When determining the impact of fraud on organizations and the economy, statistics still provide the best measuring stick – and they communicate facts in a compelling way.
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May 2014 By Jacob Parks, J.D., CFE When a seminar speaker gets to a point in a presentation about the Sarbanes-Oxley Act (SOX), it historically has meant one thing for attendees who do not work directly with public companies: good time for a coffee break. However, those days seem to be coming to an end — at least when whistleblower issues are at hand.
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Colin Yates, CFE, is founder of Yates Fraud Consulting Limited in Melksham, England. He began his investigative career with the New Zealand Police, followed by various fraud and security roles in the telecom industry and, ultimately, his own practice.
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ditor’s Note: During the holidays, many people celebrate, give gifts, make charitable donations and engage in other traditional activities associated with the season. These observances often overlap into the corporate and business environment, and can instill a shared feeling of enjoyment or camaraderie among colleagues. However, they may also create a climate in which fraud can occur – along with some other negative consequences.
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Insurance fraud is a year-round threat. While we must remain vigilant at all times, the celebration of International Fraud Awareness Week (which kicked off on Sunday) should serve as a reminder that the battle is far from over.
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ACFE Member Profile November 2014 John Schneider, CFE, CISA, CIA, serves as Chief Gaming Inspector at Pokagon Band Gaming Commission in Michigan. As a former IT director, Schneider knows the use of technology can be a key advantage both for fraudsters and the investigators trying to catch them.
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Tor is software designed to provide users with anonymity and security in some online communications.
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Catching a Fraud In Northern UK By Patrick Wellens, CFE, CIA, CRMA, with Shaun McMillan October 2014 Donovan, 48, from Scotland, was happily married with two children. He was tall and good looking, an extrovert whose outgoing personality helped him to do very well professionally. As a scientist, he built a successful research company that he sold for close to USD 70 million to a large pharmaceutical company that I’ll refer to by the pseudonym “Pharmatops.”
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By Michael Hoffmann, CFE October 2014 Fraudsters who use stolen personally identifiable information can perpetrate a wide variety of fraudulent financial schemes, such as hacking online accounts, submitting phony insurance claims, and applying for loans and credit cards to pad their bank accounts. Increasingly, though, identity theft tax refund fraud is becoming a favorite money-making scheme for criminals.
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Scott Swanson, CFE, CFCI, is a VP and practice leader of Global Risk and Compliance at Doculabs, a Chicago-based information and technology consulting firm.
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Today, just about anything can be counterfeited – and just about everything is. Most counterfeit goods are made from stolen intellectual property.
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Danielle Supkis Cheek, CFE, CPA, CVA, is the founder of D. Supkis Cheek, PLLC, based in Houston, Texas.
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September 2014 By Scott Patterson, CFE Those who work, shop or just like to wander in the gilded aisles of Saks Fifth Avenue department stores know just what the Manhattan-born retailer represents: Luxury. Status. The very best apparel, jewelry and sundry other merchandise money can buy. So when a ring of employees from a Saks Fifth Avenue in the Queens borough of New York decided to commit theft using “borrowed” customers’ credit card information, they must have thought to themselves: “Why go anywhere else?”
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Tips and advice from Ron Cresswell, J.D., CFE, on ways to avoid or mitigate angry client relations.
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Unfortunately, fraud is a year-round threat. Here are 8 scams to watch out for in 2016 because they're gaining popularity.
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In several Latin American countries, citizens are taking to the streets to protest widespread corruption in their governments, and the push for tighter legislation could create the opportunity for big changes.
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In several Latin American countries, citizens are taking to the streets to protest widespread corruption in their governments, and the push for tighter legislation could create the opportunity for big changes.
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Fraud victims go through much of the same emotional aftermath as victims of violent crime. Jaime deBlanc-Knowles speaks with Stephen Peadnault, CFE, about the emotional impact of fraud and how CFEs can help victims cope with the trauma.
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Chelsey Franks explores flaws in the background check system and tips to help compensate for them during the process of executive hiring.
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Mark Scott, J.D., CFE, shares 7 steps for creating a robust anti-fraud training program within your company.
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Interview with Samuel Martin, CFE, CPA, who shares the inspiration behind his decision to become an auditor and his favorite thing about helping small businesses protect themselves against fraud.
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As Director of Risk Intelligence for BMO Financial Group, Peter Warrack, CFE, has assisted with his fair share of investigations and challenges.
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Unique Challenges Present Unique Opportunities for Risk Intelligence Director
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According to a 2015 decision by the National Labor Relations Board (NLRB), it is illegal for employers to include a blanket policy that would prohibit their employees from discussing ongoing workplace investigations.
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Ann Petterson, CFE, Senior Manager at Baker Tilly, became passionate about fighting fraud at an early age. One of her biggest cases was the Sweet 'N' Low tax fraud case uncovered in 1997.
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Laura Hymes, CFE, reviews two ethical models that fraud examiners can use when faced with tough decisions and shares some hypothetical questions examiners can ask to reach conclusions.
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Interview with Apurva Joshi, CFE, the founder and CEO of Fraudexpress based in Solapur, India. Joshi created Fraudexpress as a digital media company to help increase fraud awareness, and provide news, views, training and other services for anti-fraud professionals. For her work as a fraud fighter and entrepreneur, she was recently featured in a book by a bestselling author Rashmi Bansal.
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A trusted office manager of a surgical care clinic, over the course of four years, found a crafty way to “redirect” company funds to a personal bank account.
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Bias can affect a fraud examiner in a number of ways. It shapes our perception of the facts. It can cause an auditor to look past red flags of fraud, or compel an overeager investigator to see malfeasance where none is exists.
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An interview with Peter Donnelly, CFE. As a deputy constable in Tarrant County, Texas, Donnelly has worked more than 1,000 non-real estate judgment writs and has collected more than $800,000 for plaintiffs in two and a half years.
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Zach Capers, CFE, provides insights on organized retail crime and shares tips on how merchants can remain vigilant, especially during and after the holidays.
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After trying out many different sectors, Gregg Stephens, CFE, Head of Fraud Prevention and Payment Security at Citizens Bank, found his professional home in fraud prevention.
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Hal Humphreys, CFE, reminds us to examine our motivation for pursuing fraud and check our biases at the door.
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Bobby Ndungu, Ph.D., CFE, CSSP, is the president of the ACFE Zimbabwe chapter and Managing Partner of the Southern Africa Institute of Security and Risk Management. Ndungu encourages chapter members and fraud fighters to conduct fraud awareness campaigns so that the public is made aware of what fraud is and how to combat it.
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With the relatively new chip technology in credit cards, many observers are concerned that the lack of a PIN requirement will undermine the effectiveness of the technology and result in only a minimal reduction of credit card fraud.
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Misty Carter, CFE, CIA, examines the case of James “Doug” Cassity, a disbarred attorney and resident of St. Louis, Missouri. His company, National Prearranged Services Inc. (NPS), engineered a scheme that defrauded purchasers of prearranged funeral contracts.
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Ryan Hubbs, CFE, CIA, CCEP, CCSA, PHR, shares tips on how to detect a fake LinkedIn profile and avoid fake opportunities, identity theft and phishing scams.
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Ryan Hubbs, CFE, CIA, CCEP, CCSA, PHR, shares tips on how to detect fake LinkedIn profiles to avoid fake opportunities, identity theft, and phishing scams.
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Laura Hymes, CFE, explores new online and technological developments. She also shares why fraud examiners do not need to become tech experts, but do need a basic understanding of advances in the industry and a strategy to stay up-to-date on the relevant trends.
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Walt Manning, CFE, shares a theoretical exploration of future crime possibilities through the rising popularity of biohacking.
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Mara McLaughlin, Senior Investigator at NYS Insurance Fund and NYS Licensed Private Investigator, had plans of becoming an attorney, but those plans quickly changed while she was working at a private investigations firm in her first job after college.
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The One that Changed the Way I See the World
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As Vice President at Credit Suisse, David Bach, CFE, says that although he's an auditor, his job is about much more than just numbers and facts. It's about the people — both his colleagues and those he examines.
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U.K. native Iain Gallie, CFE, Head of Risk Strategy and Frameworks for ASB Bank in New Zealand, entered the anti-fraud field after serving in the British Army Reserves with the British Royal Military Police.
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U.K. native Iain Gallie, CFE, Head of Risk Strategy and Frameworks for ASB Bank in New Zealand, entered the anti-fraud field after serving in the British Army Reserves with the British Royal Military Police.
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Misty Carter, CFE, CIA, shares how sentiment analysis, an analytical tool that involves creating a system to analyze documents and other data to examine the authors' emotions and opinions, can be used to detect fraud.
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“What if?” is a robust question. It was also the question that attracted Patti Buck-Torrey, CFE, Manager of Administrative Processes & Controls for FedEx SmartPost, to fraud investigation.
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A fictional example of how virtual currencies could lend themselves to complex fraud schemes in the near future.
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The practice of wine fraud goes back at least as far as the Roman era, and the biggest known scheme led by Rudy Kurniawan came to a head in 2012.
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Although David Antwi, CFE, CIA, began his career in the engineering field, but when he was introduced to fraud detection and prevention, he was drawn to it right away. Antwi, who is currently the assistant vice president of retail risk and fraud operations for GenPact, said that after his manager asked him to oversee billing fraud management for a week he was “so hooked that I asked to take on that responsibility full time.” He quickly got his CFE only a few months later and now tackles fraud on a regular basis. Antwi, who is originally from Ghana, is excited to help future fraud fighters, having established a website focused on training those interested in fighting fraud in the African banking environment.
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In order to keep up with global fraud trends, fraud fighters must be determined to persevere. As a mountain climber, former diplomat and current CEO, Philippe Montigny forged his sense of determination and perseverance “while climbing the Alps, Himalayas, Atlas Mountains, those of Lebanon, as well as the volcanoes of East Africa.”
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Sam discovers that both emails were fraudulent, that there was no sale, and that he wired $500,000 of ABC’s money directly to fraudsters. ABC was the victim of a business email compromise (BEC) scam (also known as CEO fraud).
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Samantha Weeks, CFE, deals with a variety of areas of fraud risk in her position as a business risk analyst for Southwest Airlines. In charge of examining potential risk in external partnerships, customer loyalty programs and internal threats, Weeks believes the key to prevention is not only information, but developing a deeper understanding of how people operate. “Know yourself. Know what motivates the people you work with,” Weeks said. “Understand how the Fraud Triangle presents itself in someone’s life. Have compassion for victims.”
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Organizations with highly unethical cultures, such as Enron, do not happen overnight; it’s often a series of incremental changes.
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As part of their fraud prevention strategies, many organizations monitor their employees’ activities in the workplace. Video surveillance can be used to deter and detect theft by employees. The monitoring of employee emails might reveal internal fraud schemes. Confidential business information can be protected by monitoring how employees use their computers. For each type of employee monitoring, however, there are legal restrictions that vary by jurisdiction. A company’s employee-monitoring program can be legal in one country but violate the laws of another.
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Whistleblowers can be divisive characters. Celebrated by some as heroes and denounced by others as snitches, few other elements that come up during a fraud investigation can spark such polarizing labels. During her session at the 2016 ACFE Fraud Conference Asia-Pacific, Jessica Sidhu, CFE, Llb, explored the precarious position whistleblowers are in. “Is a whistleblower a good person or a bad person? Is he a traitor or is he a patriot?” she asked the audience. “Only when you’ve answered this question will you be able to take a whistleblower seriously.” The topic was especially pertinent to discuss during the conference in Singapore, as the government of neighboring Malaysia has been involved for a few years with the 1Malaysia Development Bhd (1MDB) scandal. Global investigators believe that millions of dollars from the state investment fund 1MDB entered Malaysian Prime Minister Najib Razak's personal bank accounts.
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The U.S. credit card system is undergoing big changes that will affect how financial institutions, retailers and consumers conduct transactions and try to prevent fraud well into the next decade. Financial institutions in the United States traditionally issued credit and debit cards with magnetic stripes that store customer account information, and retailers used point-of-sale systems designed to read the magnetic stripes.
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Continuing to learn and feed her curiosity are some of the most important things to Dr. Susan Mangiero, CFE. In addition to her extensive background in financial fraud and risk management, Dr. Mangiero is a published author and is currently working on a new book. She is the lead contributor to a blog about investment risk management and compliance. Her work has taken her to many places and exposed her to multiple industries, something that she feels has strengthened her abilities to identify red flags and explain problems that occurred.
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Val Sedgwick used his ties to the Church of Jesus Christ of Latter-day Saints to assure real estate investors of his trustworthiness to use their funds to develop land, when in fact he was using their money to pay for his personal expenses and past debts. Nicholas Garza swindled his employer and its clients with an invoice edited to include fraudulent charges used only for his benefit. James Douglas Oliver convinced small businesses to pay for a spot on the “clown map” he was creating. His business, Clowns and Maps Are Us, never got around to making that map.
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“Think fraud, fight fraud, anytime, anywhere. Sacrifice for the good of others,” says Dante Fuentes, CFE, CPA.
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Steve McFarland, CFE, CICA, CBM, first entered into fraud investigation as a personal favor to a friend who had fallen victim to a fraudulent general contractor.
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Anticipating the threat of fraud is essential in the global fight against white collar crime. With preparation, your organization stands a chance against perpetrators. “You first have to understand the present and potential risks,” says Brett Soldevila, CFE, CPA, Chief Compliance Officer at Security Holdings. “Take away as many opportunities to commit fraud as possible, and make sure employees are aware of company requirements and penalties for noncompliance through policies and training.”
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As the office CFE, you recently learned of fraud allegations within your organization. Apparently, someone has been embezzling funds and using the accounts payable system to do so. You now have to begin the investigation to figure out who may or may not be involved —what do you do?
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Before the Internet, travelers searching for a place to stay were typically limited to hotels, but in today’s digital world, they can also use online home-sharing portals such as VRBO, Airbnb, and HomeAway. These services connect homeowners who want to rent out a room or their entire house or apartment with travelers who want an alternative to hotel chains. With the home-sharing economy increasing, scams used to defraud unsuspecting consumers are also becoming more common. Because more individuals and organizations are using home-sharing sites to book short-term rentals, fraud examiners should be aware of the various types of scams that exploit this market.
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Daniel Worrell, CFE, progressively and consciously grew his career from his first job out of college to his current position as the Director of Internal Controls at the New York State Metropolitan Transportation Authority. “My first exposure to the anti-fraud field was as an auditor for the New York Office of the State Comptroller,” says Worrell. “Solving or mitigating internal control weakness has been something that I enjoy. From that initial exposure, I have made sure that every job that I have held since has included some level of anti-fraud responsibility.” Here, he shares his tips to help his colleagues succeed in their careers whether they are in the beginning stages or seasoned professionals.
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One would think that Matthew Lynch, CFE, Director of Special Investigations Unit for Healthfirst, was raised to be a fraud fighter. “I’m the product of Catholic school and Military College discipline and education — with emphasis on the discipline.”
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Do you think the risk profile of a young, eager professional beginning his or her first job out of college is different than that of a savvy veteran who has risen through the ranks of a company over a period of 15 or 20 years? In the eyes of a professional fraud investigator, the answer would certainly be yes. Any executive would likely reach the same conclusion in an impersonal, hypothetical conversation, but putting that knowledge into practice with familiar employees can be difficult. Executives in a position to supervise and monitor the activity of a 15- 20-year veteran can be blinded by their personal relationships with that person and rely too heavily on long-established trust. However, the risk that a long-term employee will commit fraud depends not only on the individual’s tenure and familiarity with the business, but also on the life circumstances of someone in mid-career.
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For Rick Belik, CFE, Omaha Police Department Detective and part-time Task Force Officer for the FBI's White Collar Crime Task Force, fraud is often very personal. Belik, who was awarded the ACFE Outstanding Achievement in Community Service Award in 2015, has dealt with numerous cases of elder fraud. In addition to tackling cases that come across his desk, he is proactive about fraud education in his community. He has held numerous talks and seminars for senior citizens and caregivers to discuss common scams that target the elderly and how they can protect themselves from fraud.
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The two most common types of judicial corruption are political interference and bribery. Political interference is when politicians or staff from the legislative or executive branch meddle in judicial affairs or collude with judges in fraudulent schemes. Despite efforts in many countries to isolate the judiciary from politics, judges and other court personnel still face significant pressure to rule in favor of powerful political or business entities rather than in accordance with the law. A malleable judiciary can be used by those in power to provide protection for and lend legitimacy to fraudulent acts. Judges might also collude with politicians in a variety of different white-collar crimes, such as extortion, money laundering and embezzlement.
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Richard McIlveen, CFE, CPA, vice president of corporate investigations for Iron Mountain Inc., first decided he might be interested in fraud investigation when he wanted to join the FBI. While he initially saw accounting as just a way to get a foot in the door, he quickly realized he had a knack for it. At Iron Mountain, he spearheaded an organization-wide push to become completely compliant with immigration employment laws. McIlveen has taken his talent and passion for risk management and now helps implement fraud controls across the world.
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The lack of correlation between a person’s education and their propensity to fall victim to a fraudster is all too familiar. Fraudsters are entrepreneurs. The types of fraud they perpetrate and the marketplaces in which they find success vary depending on their talents, skills and operating comfort zones. Also, fraud is a relational crime. Potential victims — prospective marks — will be more susceptible to the persuasions or pressures of someone with whom they are familiar. It can be difficult to say “no” in such circumstances. People are often charmed or seduced by compelling elements which resonate as emotionally familiar. Everyone scans for certain cues regarding other people's education or social station, but ultimately we can give over trust or suspend disbelief for reasons unconnected to rational thought.
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A simple definition of embezzlement is “the misappropriation of funds that have been entrusted to one for care or management.” Typically, embezzlement is a bottom-up offense, in which an employee, who could be anyone from an entry-level clerk to the director of the organization, steals from their organization’s financial assets.
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Bankruptcy fraud is a white-collar crime that can take on many forms. It can be used as a means to conceal assets to avoid having to forfeit them. In bankruptcy fraud schemes some people intentionally file incomplete or false forms or file multiple times in several states using false or legitimate information. Most bankruptcy frauds involve the concealment of assets. In some cases, individuals might transfer their unrevealed assets to family or friends to keep the assets from being located.
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Philip A. Ciuffo, CFE, likes fixing things. As Chief Audit Executive for The New York Times, he ensures that the publication is diligent in their controls in all processes, and in his personal life, he enjoys fixing anything broken around his home. Ever since he began his career in investigating fraud for a major metropolis, he’s approached audits with pragmatism, but does not allow them to color his view on others.
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One of the challenges auditors face is persuading management to implement preventive fraud controls without inadvertently teaching them how to commit the fraud. Unfortunately, sometimes we have to explain in great detail, or worse, show how a fraud can be committed. We worry about this. Well, I worry about this. A lot. Occasionally we find blatant opportunity that we are stunned to realize no one has exploited. The most frequent reasons: ignorance and luck. Not exactly the best controls.
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The technology underlying the virtual currency Bitcoin has the potential to disrupt several industries while significantly reducing fraud. Known as blockchain, the technology was created to ensure the legitimacy of every Bitcoin transaction by tracking them in a distributed public ledger. Bitcoin has endured a divisive reputation due to its volatile value fluctuations and use in illicit transactions on the deep Web; however, the security and utility offered by its blockchain is anything but controversial.
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While most people understand the importance of security when using personal computers and smartphones, far fewer recognize the perils posed by seemingly innocuous WiFi-enabled coffee makers, networked thermostats, and other smart products from the rapidly expanding Internet of Things (IoT).
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Margaret is a retired schoolteacher and widow with two children and four grandchildren. Richard, a practicing physician, is a faculty member at a university medical center. Adam is a fourth-grader who excels at math but has a strong dislike for cleaning his room. John, an attorney, has been practicing tax law for more than 20 years, and his friends are among the upper echelon. Of these four people, who is the most likely victim of fraud?
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We live in a world that is becoming more digital every day. From desktops and laptops, to tablets and smartphones — technology is all around us. This proliferation of technology presents new opportunities for fraudsters to commit and attempt to conceal fraudulent activity.
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Investment fraud can happen to anyone, and unfortunately, there is no shortage of investment fraud possibilities. Affinity fraud, pyramid schemes, pump-and-dump security trading, high-return or risk-free investments, and pre-IPO scams are only a few of a long list of schemes that could separate investors from their hard-earned money. Investors can find themselves the victims of fraud when they don’t do enough due diligence or put too much faith in the people selling or managing a fund. Investors around the world would be wise to grasp fundamentals of the financial services industry so they can ask questions during sales pitches and be able to better vet product literature and contracts. Companies also need to better communicate risks in a user-friendly manner. A 2016 survey conducted by the National Association of Retirement Plan Participants shows that only one in 10 persons interviewed has confidence in financial institutions. Financial advisors are similarly viewed by some investors with skepticism. This is problematic.
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Chelsea Binns, Ph.D., CFE, knew from a young age that she had the skills and perception to be a successful investigator, but her life as a CFE has allowed her to take on more roles than she ever expected. Out of all the roles she’s filled — investigator, fraud hotline operator, professor — her favorite has been mentoring young fraud fighters. Currently, she serves as the Vice President and Training Director for the ACFE’s New York Chapter, where she’s driven to help student members forge their own paths in exciting anti-fraud careers.
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Many revere houses of worship as the ultimate places of trust, and the people who work for them, pillars of the community. That makes it all the more painful when a church, synagogue or mosque, and their worshippers, fall victim to embezzlement.
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Everyone in every generation is at risk of becoming a victim of fraud. And with the emergence of the World Wide Web in 1991, the continuing evolution of technology and the fraudsters who are keeping pace with today’s technological advances, the types and occurrences of fraud are ever-increasing. Fraud affects 25% of North American households annually and costs consumers approximately $50 billion. Here are some brief insights into the generations and the frauds to which they most often fall victim.
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Unlike some CFEs, Natasha E. Williams, CFE, CIA, didn’t begin her career in fraud. The global compliance manager for Bio-Rad Laboratories began in tax, but became interested in fraud after meeting a forensic account. She took a leap of faith and earned her CFE credential without a set plan. “When I first received the CFE credential I wasn’t working in fraud and had no idea how I was going to get the experience necessary to land a job in the industry, but here I am today,” she said. “I love what I do and I am living the dream — and so can you.”
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Elizabeth Simon, CFE, CPA, first became interested in becoming a fraud examiner after hearing about a fraud case in a CPE course. Since then, she’s worked in a variety of careers leading up to her current role as director of ethics and compliance at Cox Communications. Simon says since becoming a CFE she’s used the credential to strengthen and expand her role. “I have been able to work with law enforcement to put together evidence books for prosecution,” she said. “I am seen as an expert and am well respected by my boss, my VP and the law enforcement officials that I work with.”
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Last week I taught a course on leveraging data analytics to detect fraud. I love teaching fraud courses and have had a decade-and-a-half love affair with data analytics — specifically what a mature analytics program can do for an organization. When teaching, my favorite moment is seeing the lightbulb go on for class participants when something truly hits home. But I struggle to explain how I knew when I found a fraud. Sometimes it was the unusual correlation between changes in related accounts, sometimes it was the new Audi R8 in the parking lot that sent me down a fraud sleuthing trail and sometimes it was just having the courage to keep asking questions. But how do I teach that? I can explain what I saw, what it made me suspect and how I went about verifying, but how do I translate that into something they can use when my students will probably never see something that exactly resembles my experiences? Can you teach intuition? Maybe, maybe not — but you can teach practices that help hone intuition.
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Those over the age of 65 are more likely to have lost money due to a financial scam than someone in their 40s. To help the elderly avoid becoming victims of fraud scams, it is important to understand why they are targets, what schemes and tactics are commonly used against them and how these schemes affect them.
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Janice Janssen, CFE, co-owner of Global Team Solutions and Dentrix Certified Trainer at Henry Schein Practice Solutions, first became interested in fraud prevention when a dental practice at which she worked fell victim to embezzlement. The scheme was especially hurtful because it was perpetrated by someone she considered a friend. After processing the emotions so many victims go through, she became determined to help others prevent fraud before they could be taken advantage of. She started her own fraud prevention business to help dental offices, and partnered with another anti-fraud professional to help countless clients prevent, detect and recover from fraud.
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Businesses are attractive targets for fraudsters. They tend to have deeper pockets than individuals, and their ability to detect fraud is sometimes hindered by the large number of transactions they engage in. This articles discusses five common scams that that target businesses and how to stop them.
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Having been a CFE for nearly a decade, Karen Sheppard, CFE, assistant vice president, Frost Bank, has seen fraud affect all kinds of people. “Fraudsters are ruthless and they don’t care how many lives they destroy. They prey on the homeless, the lonely and even the disabled,” she said. After initially becoming interested in fraud through working on a kiting scheme, Sheppard has continued her efforts to prevent and investigate fraud in her native Texas.
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The NFL Super Bowl is just around the corner, and fraud can a serious concern in buying tickets from resellers. It’s not just sporting events that fraudsters target, either. Any event that requires a ticket for admission — a concert, festival or presidential inauguration, for example — is ripe for a ticketing scam.
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“Second Year Syndrome” is the malady of medical students who experience the symptoms of the disease that they are studying at the time. If they’re studying skin cancer, suddenly that zit becomes melanoma. If they’re studying arthritis, their joints start to ache. If they’re studying narcolepsy, they suddenly feel they’re about to fall asleep. (That last might be attributable to being grossly overworked, but you get the idea.) I’ve been a Certified Fraud Examiner for more than six years now and I worked in the field of financial crime prosecution longer than that. I can testify that our Association’s version of Second Year Syndrome, “CFE Syndrome,” is real, it is alive, and it can permanently take over your life. CFE Syndrome is the belief that the CFE is about to become the victim of the type of fraud scheme she is examining at the time, and it can turn the most reasonable, common sense-driven CFE into a sullen, twitching bundle of suspicion.
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Adama Renner, CFE, FCA, is no stranger to fraud, having been involved in fraud detection and prevention since the early 2000s. She serves as the Deputy Audit General of Audit Service Sierra Leone (ASSL) and has played an instrumental role in exposing high-level governmental corruption that led to multiple public servants suspended without pay. Renner recently attended her first ACFE Global Fraud Conference and found the experience to be inspiring and enlightening. “Listening to the presentations and interacting with fraud examiners from other fields helped me to appreciate how I can better undertake my audits in order to increase the chances of a successful prosecution in a court of law,” she said.
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A recent study of the 10 most populous states in the U.S. by the Economic Policy Institute (EPI) found that 2.4 million workers lose approximately $8 billion annually to minimum wage violations. This amounts to nearly a quarter of the total wages of the affected workers (or about $3,300 annually for year-round employees). Extrapolated to cover the entire U.S., this suggests that workers lose more than $15 billion per year to minimum wage violations alone. Minimum wage violations occur when employers fail to pay their employees the legally-mandated wage. An employer might flout minimum wage laws by paying employees under the table or by requiring them to clock out at a particular time but to continue working without pay.
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Britta Bohlinger, CFE, MA, Quality Manager and Auditor for IHK Berlin, and founding director of RisikoKlár, is no stranger to debates or uncomfortable discussions. From a young age, she enjoyed lively conversations with her father about his work and later became active in academic association discussions. She said, “The element of informal mentoring was invaluable — a source of motivation, challenge and aspiration. [The discussions] were also a source of comfortable discomfort as being an active member always reminded me of how much more I needed to learn.” As the only female CFE in Iceland, she now brings her passion for discourse and spreading risk management knowledge to the ACFE’s members-only online community and her clients.
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In 2016, the Ponemon Institute conducted a study to examine the financial impact insider threats pose to an organization. Based on results of the study, the total average cost of insider incidents was approximately $4.3 million annually — with the largest cost resulting from contractor and employee negligence (68%) and malicious insiders (22%). Breaches due to employee and contractor carelessness cost organizations $2.2 million annually, while those related to malicious insiders cost organizations $1.23 million per year.
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When we talk about fraud detection, we speak the language of red flags — and red flags come in many forms. Sometimes we look for attributes of the fraud itself, sometimes the signs of concealment or conversion, and sometimes we look for what’s just not there but should be. Most fraud fighters know the fastest way to find ghost employees is to look for what is missing — ghost employees will be missing vacation, sick days, retirement planning and physical access to systems or buildings. Ghost employees can be easy to spot when you know what to look for, but when else should we focus on what’s just not there?
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Dr. Richard Lyschik, DDS, CFE, FAGD, President of Practice Rescue, was in the health care industry for many years before he added fraud prevention and detection to his skillset. While providing management consultation to many practices, he observed a variety of fraud schemes and was disheartened at how many medical professionals were hesitant to do anything about it. He warns that perpetrators in health care fraud schemes can be anyone and that doctors need to get more serious about punishing fraud.
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A particular weak point was the lack of regulation regarding how lawyers handle client funds in interest on lawyer trust accounts (commonly referred to as IOLTA or IOLA). Congress passed regulation allowing the use of IOLTAs in the 1980s, following changes to federal banking laws that allowed certain checking accounts to bear interest. Attorneys use IOLTAs to hold either small or short-term client funds. The interest generated by these funds is then donated to charitable legal organizations (normally through a state IOLTA program).
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In the decade since that first experience, I have noticed a pattern with all my clients, whether they are the owners of small, closely held businesses, board members of a nonprofit organization or even CEOs of publicly traded companies — the first reaction to fraud has nothing to do with the money lost. It has everything to do with the emotions that accompany trust being breached. Fraud is typically perpetrated by the most trusted individuals in my clients’ organizations. These fraudsters are the last ones who would ever be suspected of such nefarious activity and the result is an understandable, gut-wrenching heartache experienced by clients.
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Many of the fraud-fighting heroes who will come together this June in Nashville, Tennessee, for the ACFE Global Fraud Conference are at the top of their careers. But fraud fighters aren’t just born with a sixth sense for schemes. Even heroes must learn what it takes to combat fraud. We talked to a few of this year’s conference speakers about the early cases that left an impression on them and taught them the essentials of fighting fraud. Through these cases they developed persistence, had their lives changed and learned the importance of counting cattle in West Texas.
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Many CFEs pride themselves on being fraud fighters, but it’s rare for a fraud fighter to also be an actual professional Mixed Martial Arts (MMA) fighter; Josh Eckmann is one of those few crossover talents. While not yet a CFE, Eckmann is currently participating in the ACFE 90-Day Challenge — a sprint to prepare for, and pass, his CFE Exam. Eckmann has worked in the insurance anti-fraud field for years and finds that pinning down fraudsters in an investigation is more similar to facing down opponents in the cage than one might think.
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Every year for the past decade, the not-for-profit (NFP) sector has been voted the most trusted in the world — but just how valid is that ranking when it comes to fraud? The sector remains highly vulnerable due to its foundation on a veneer of trust, however there continues to be a high level of complacency around the topic. Unless NFPs start to recognize and tackle fraud risk, their reputations and public confidence built up over many years could be wiped out overnight. So where does this apparent reluctance to deal with the issue stem from?
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When natural disasters, mass tragedies or class action settlements occur, victim compensation funds are often created contemporaneously. These funds are created to benefit victims, but they are also an attractive target for fraud. When large corporations, agencies or insurance companies establish relief funds, fraudsters rationalize their thefts because they believe that these large entities can absorb the costs. Since huge settlements involve numerous transactions and claims, fraudsters often hope that their actions will be lost in an enormous sea of data. The allure of a big payout can be a draw for fraudsters. Luckily, there is an answer: big data analytics.
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Like a number of CFEs, Sgt. Paul Bilotta of the Chicago Police Department became interested in fraud when it hit close to home. In the late 2000s, the president of the Chicago Police Sergeants’ Association was arrested when it came to light he had embezzled more than $1 million from his fellow officers’ dues. “He hurt his friends who trusted him, and he hurt his co-workers who believed in him,” Bilotta told the Chicago Tribune. Bilotta never intended to get involved with the case but ultimately found himself as one of the leaders of the association as they rebuilt.
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While a report prepared by the Risk and Infrastructure Science Center indicates that severe weather — like Hurricanes Harvey and Maria — lead the pack when it comes to causes of power outages in the U.S., Mother Nature is not without rivals. Power grids can go down for a number of reasons beyond natural disasters. They often use aging equipment, are prone to human error and can just malfunction. However, energy hackers are starting to play more of a role in blackouts.
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Jill Handley, CFE, was born and raised in Marble Rock, Iowa, on her family’s farm in the house where her father was born. One of the many things she learned from her mother was how to make cookies. Even now, when she is not running her own dispute resolution service, she spends time making cookie-cutter cookies. “I have collected more than 250 cookie cutters of all shapes, themes and sizes,” she said. “It is a hobby that permits creativity, but it is also relaxing because of the repetitive nature of the cutting.”
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Fraud schemes in the wake of a disaster are as certain to happen as the heavy rains and top-speed winds from a hurricane. Past storms such as Hurricanes Katrina, Rita and Sandy showed that disasters not only create optimal conditions for schemers to exploit, but also that the swirl of confusion and destruction that follow can make discerning fraudulent acts from honest victims in need extremely difficult. However, these past storms also showed the importance of being prepared and ready to confront disaster fraud.
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You don’t have to go further than turning on your flat-screen TV to know that crime and corruption are constantly in the news and focal points for TV entertainment. However, what’s less understood by the general public, but well known to investigators, is that the most mundane details of a case are often the most important ones. One of these obscure elements is now in the spotlight: anonymous shell companies, and the role they play in enabling money laundering and illicit activities. Whether it’s the Panama Papers leak in 2016, the massive Brazilian Car Wash scandal, the Russian laundromat, or a growing collection of news articles involving luxury real estate purchased by shadowy figures, the role that anonymous shell companies can play in nearly every crime that generates money is being revealed.
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While the mention of artificial intelligence (AI) may prompt many people to immediately visualize sentient robots taking over Earth and subjugating the human race, limited forms of AI have already been contributing to anti-fraud efforts for decades. As AI tools evolve, so too will their roles in fighting fraud, with major implications for many industries in which fraud is prevalent. As technology shapes the global economy and consumer behavior, it also influences the way fraud is perpetrated, thereby requiring adaptation in the perpetual fight against fraud. One tool that many organizations are looking to use is AI.
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Digital currencies as a medium for the exchange of value are here to stay. Many predicted that crypto-currencies (digital currencies using encryption techniques to regulate and verify the generation and transfer of currency units) would be short-lived due to the lack of trust, lack of regulation and the fact that their use was simply too complex for the majority of the general public — yet how wrong they have been.
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Although he began his career in law, Richard Barbieri, CFE, found himself drawn to fraud cases. Now the senior manager of risk operations at Etsy, he deals less with money laundering cases and more with customer and merchant verification. When he isn’t overseeing his team of 20 at work, Barbieri enjoys running and cheering on his favorite baseball team.
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One would think that a CFE with over nine years of experience assisting in the prosecution of white-collar crimes would be somewhat Zen about being the victim of a fraud attempt herself. One would think that, and one would be wrong.
Published in Fraud Examiner Archives
After high-profile CEOs Martin Shkreli and Elizabeth Holmes got their comeuppance for securities fraud in March 2018, the Washington Post and New York Times published stories examining the disparities in their punishments. While public image might be an important aspect in their cases, John C. Coffee, Jr., a law professor at Columbia University, adds another interesting factor to the mix — gender. The case of the two CEOs provides an opportunity to take a closer look at the relationship between gender and fraud and the types of frauds that men and women (in particular) tend to commit.
Published in Fraud Examiner Archives
In the 2018 ACFE Report to the Nations on Occupational Fraud and Abuse, the ACFE studied 2,690 cases of fraud from 125 countries in 23 different industries. While the fraudsters came from different backgrounds, displayed varied red flags and were discovered in a multitude of ways, one very clear fact emerged: owners or executives that committed fraud caused the greatest monetary damage.
Published in Fraud Examiner Archives
Hossam El Shaffei, CFE, has been interested in fighting fraud since first seeing normalized bribery occur in his native Middle East. Currently a partner specializing in risk advisory services at RSM Consulting, he has more than 35 years of global and regional work experience in multinational organizations such as the United Nations (UN) and United States Agency for International Development (USAID). El Shaffei also established ACFE chapters in Egypt and Jordan, and recently became an Authorised Trainer for the CFE Exam Review Course in Jordan, Egypt and Lebanon.
Published in Fraud Examiner Archives
Based on the name alone, it seems like ad fraud only affects those in the digital advertising and marketing industries — but that could not be further from the truth. If a business has any online presence, including websites or social media accounts, it could be a prime target for ad fraudsters.
Published in Fraud Examiner Archives
The use of coin miner malware is generally referred to as “cryptojacking.” This malware quietly hijacks the infected computer and uses its processing power to mine cryptocurrencies — and it's quickly becoming the most prevalent type of malware to hit business devices.
Published in Fraud Examiner Archives
Victoria Rodriguez, CFE, grew up surrounded by law enforcement influences. She always knew she wanted to help bring wrongdoers to justice and found her perfect fit not wearing a badge, but working in the special investigations unit of Texas Mutual Insurance. Even after a decade since obtaining her CFE credential, she still approaches each investigation with an open mind and adaptability to follow where the evidence takes her.
Published in Fraud Examiner Archives
What started as the heartwarming story of a homeless veteran giving his last $20 to a stranded motorist, whose car had run out of gas on a Philadelphia highway ramp, quickly turned into a cautionary tale of the dangers of online fundraising sites and their potential for fraud.
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I am no longer amazed by the missteps of any financial organization. The incentive policies and amalgam of personnel with widely differing views (borne out of previous financial organizations) can lead to a cocktail of disasters. Today, policies and standards seem to be written in a vacuum, only to see the light of day when regulators call. However, it appears we do have a benchmark: a well-understood policy is worth $18 million, plus costs, time and energy.
Published in Fraud Examiner Archives
Dr. Tonisha Pinckney, CFE, is not only the founder of Revelatus Specialized Accounting & Consulting, LLC, but is also a lecturer, adjunct instructor, a former director of criminal justice undergraduate and graduate programs, assistant dean and a published author. Dr. Pinckney’s extensive work volunteering in her community and spreading fraud awareness education bolsters her core philosophies. “I feel it is my duty and purpose to mitigate the impact of victimization in communities. With education comes responsibility,” she said. “As CFEs, we are empowered by our education and must responsibly use it to educate those who would not ordinarily have access to our services.”
Published in Fraud Examiner Archives
Phantom debt schemes vary wildly, but generally involve the attempted collection of debt that either doesn’t exist, has already been discharged or has been artificially (and illegally) inflated. These schemes run the gamut, from outwardly criminal (e.g., an individual cold-calling people trying to collect an imaginary debt) to having a veneer of legitimacy.
Published in Fraud Examiner Archives
Death is an inevitable part of life and as loved ones pass away, many find themselves dealing with a number of practical matters. One aspect that needs to be handled is probate — a legal and accounting process that is triggered by the death of a person. Probate forces people to face hard topics at a time of loss and change, and unfortunately due to that hardship, it can serve as an opportunity for unscrupulous fraudsters to prey on victims.
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David Kirtland, CFE, CIA, CRMA, is not one to slow down any time soon in his fight against fraud. Since joining the ACFE in 2013, the current compliance manager at AXIA Partners has kept extremely active in continued learning. “It is so important for us as anti-fraud professionals to guard against complacency in our development because the people committing fraud are not stagnant,” Kirtland said. “Fraud is a continuously evolving thing that is constantly trying to gain and retain the upper hand, and if we do not continuously seek out new knowledge, we will quickly become irrelevant.” He is also a pillar in the anti-fraud community — Kirtland serves as program director and vice president for the ACFE Houston Chapter.
Published in Fraud Examiner Archives
When investigating potential frauds, examiners often use financial institution records. While they can be of great value to an investigation, I have also seen cases where the information called for is too limited in scope and may not reflect the true nature of the subject’s business with the bank. We know that banks hold and manage documents such as signature cards, account statements, etc., but have you considered delving into the business process of a bank? This is information that is necessary for them to conduct business and extends well beyond account information. It could include records of telephone conversations, internal bank emails, as well as meetings and discussions. These documented communications or decisions by personnel and higher-ups could have an impact on client accounts. During a fraud investigation you might subpoena this type of information, so why think of banks data differently?
Published in Fraud Examiner Archives
Division of labor has naturally integrated into every part of our society over time. Individuals pursue education and careers according to their strengths and passions. On a higher level, even organizations find success by focusing resources on what they do best and outsourcing what they don’t; hence, the rise of business process outsourcing (BPO) vendors. While they have been around for a while, BPO vendors became more mainstream in the early 21st century. The global BPO market grew from $45.6 billion in 2000 to $140 billion in 2016, with an anticipated revenue of $163 billion by 2021. Initially, businesses sought out BPO vendors to reduce expenses related to back-office tasks, such as accounting and administrative functions. For such services, BPO vendors can often provide a higher level of service at a much lower price. However, outsourcing front-office tasks quickly followed.
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Shannon Grayer, CFE, CBM, CCEP may have earned his CFE more than a decade ago, but his passion for learning more about the world and fraud examination has never waned. The head of ethics and compliance investigations for CSRA Inc. has lived in multiple countries, stays abreast of technological advancements in the IT industry and works with major players in U.S. national security. When he’s not on the job, you might catch him at a show or museum in the Washington, D.C. area.
Published in Fraud Examiner Archives
Why do people commit financial fraud against the businesses that employ them? Do they lack the resources to fund their lifestyles? Are they under pressure to meet revenue targets that result in executive bonuses? Is there an underlying hostility toward the corporation or the government entity? The motivations giving rise to these questions may be present in a major portion of fraud; however, all of them fail to address the underlying mechanism that enables almost all white-collar crime.
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Montreal-based fraud examiner Sandrine Paquin-Lessard, CFE, CPA, CFF, CA, has enjoyed a meteoric rise in the anti-fraud field. The director of fraud prevention and detection for Cogeco Communications knew she wanted to fight fraud the first time she took a fraud-related class while studying to become a CPA. She quickly set her sights on securing a job in the field and hopped around a couple firms before finding her perfect role at Cogeco. In her spare time she loves to surf and salsa dance.
Published in Fraud Examiner Archives
Anti-fraud professionals’ efforts in detecting and exposing fraud across multiple industries often result in severe fines and penalties. While these might make national or global headlines, what is often left unanswered in those stories is who benefits from the well-deserved fines and penalties levied against major corporations.
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Today’s management teams and boards are being asked to report on the status of their risk management programs more than ever before.With all this attention, it’s not surprising that management and board members are investing heavily in new methodologies, strategies, tools and systems to navigate this increasingly complex governance, risk and compliance (GRC) environment. A Fraud Risk Assessment (FRA) is an important piece of that puzzle. It should not be seen as a stand-alone or one-time exercise, but closely linked to the organizations overall risk management program.
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Mary Durden, CFE, FCLS, has enjoyed a long tenure at insurance giant GEICO. Beginning as a customer service representative, she found her calling as a special investigations unit (SIU) field analyst. Since embarking on that career path, she has investigated and assisted in the prosecution of hundreds of fraudsters.
Published in Fraud Examiner Archives
The ease with which consumers can order and return products through online retail outlets allowed three Indianans to develop a system that made them more than $1 million before they got caught. While Amazon might be able to withstand fraud losses more so than smaller operations, all online retailers need to face the realities of e-commerce fraud and determine which methods of prevention can get them to a manageable level of fraud loss.
Published in Fraud Examiner Archives
Every organization uses incentive programs. Some organizations’ incentive programs can have positive outcomes and others only have moderate outcomes, but both can lead to fraud. So what causes one program to result in fraud while another does not? Unfortunately, there are many factors, but it starts with the purpose of the incentive program. Is the purpose to inspire, punish, influence or deter?
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Paul Hurrell, CFE, has enjoyed a long and varied career in the anti-fraud field. He began in the public sector, serving in the New Zealand Police before making a switch to the private sector. Now the head of his own firm, Hurrell Global Risk, he is thriving in the ever-evolving landscape international client services. “What I enjoy are the opportunities it has given me to meet people in different locations, areas of business or countries I may not have met otherwise,” he said. “I work on engagements that use my skills in areas I had not even thought of — some not related to fraud or crime at all. Also, those I assumed would be competitors have become associates and mentors, generously imparting their experience and knowledge.”
Published in Fraud Examiner Archives
Many large-scale frauds have had lasting impacts on companies, industries and even countries. Some negative, some positive. In the case of India’s Punjab National Bank (PNB) and its still-unfolding fraud scandal, there are indications that the ultimate result could be a much more fraud-resistant banking system in one of the world’s fastest-growing economies.
Published in Fraud Examiner Archives
The FTC is one of the largest agencies that records consumer complaints. Their compiled data provides one of the best pictures of fraud we can get. Unfortunately, people often have no idea that they should notify the FTC. In lots of cases, the people most likely to have their identity targeted don’t even know their identity has been stolen.
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In 2017, a Texas man was arrested for stealing more than $1.2 million worth of fajita meat from his government employer. The man was quickly nicknamed “the fajita bandit,” a phrase that proved irresistible to headline writers. Dozens of news outlets picked up the story, and the fajita bandit gained brief, widespread notoriety. The case made news again in April 2018 when the fajita bandit was sentenced to 50 years in prison for his crime. While it is a strange story, the case of the fajita bandit contains useful lessons about fraud and internal controls.
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Erling Grimstad has enjoyed a long career in the anti-fraud field. Starting out as a financial police investigator, he worked for the Norwegian Serious Fraud Office, headed up investigation and compliance teams in accounting firms and most recently established his own law firm to tackle investigation and compliance issues for private clients. His investigations have spanned the globe and he has encountered a wide range of fraud cases. From his earliest days he knew he wanted to right wrongs in the arena of financial crime. “I got a strong perception of unfairness and injustice,” he said. “That has been my motivation to fight fraud and corruption since.”
Published in Fraud Examiner Archives
According to the 2018 Deloitte Holiday Retail Survey, 54% of Americans plan to buy gift cards during the holiday season. Gift cards are the most popular gift listed in the survey, beating clothing (53%), toys and games (46%), and books (43%). Clearly, Americans love gift cards, unfortunately, fraudsters love them too.
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Peter Treyvaud, CPA, has nearly three decades of experience in the compliance and fraud risk management realm, and his work has taken him around the world. Currently the senior vice president of corporate compliance for 20th Century Fox, he has been a member of the ACFE for a number of years. “The ACFE provides me with convenient access to fraud risk thought leadership, tools and techniques that have helped me to plan and execute our fraud risk management program and to ‘sell’ the benefits of the program to key stakeholders,” he said. “I also value the ability to easily connect with like-minded professionals through my ACFE membership.”
Published in Fraud Examiner Archives
Dennis Dambruck, CFE, CPA, CMA, has enjoyed a long, illustrious career in the financial sector. While he’s worked in many different countries, he currently lives in the small island nation of Curaçao, where he volunteers with youth sports nonprofit organizations. In his spare time he plays baseball with his sons and runs marathons.
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In 2017, PBS’s long-running documentary series Frontline examined the Low-Income Housing Tax Credit (LIHTC) program to determine whether it was living up to its goal of creating affordable housing for low-income Americans. But, as fraud examiners know, maintaining a successful government program means guarding it from fraud, especially when the program provides a vital service such as affordable housing.
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Has there been a time in your life when you were conflicted between two choices? While there are certainly times when you can’t go wrong with either choice, there are definitely instances when what you should do and what you want to do fail to align. What choice do you make in those situations? Do you follow your ethical and moral code, or do you cave in to your desires? Just like a number of corporate executives and small business owners, the decision you think you will make may not match the decision you actually make.
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Jaco de Jager, CFE, is the CEO of the ACFE's largest chapter, the ACFE South Africa Chapter. He manages a group that is responsible for more than 6,000 chapter members and is currently helping put together the 11th Annual African Fraud Conference and Exhibition. He believes fraud fighters can play an important role in their jobs and communities. “Remember that you pave the way for others, and as a leader, you must continue doing your part to do away with fraud and corruption,” he said. “You form part of the unsung heroes. Keep going.”
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We value success so highly, that even intelligent, rational people will accept it at face value and not question it. Look at Bernie Madoff — he was guaranteeing impossible 20% returns. Enron grew every quarter and never missed a forecast or expectation. In hindsight these were clear red flags, yet in real time only a small number of people ever questioned whether those successes were possible. So why don’t we question success?
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Consider the following scenario: a client has asked you to find suspected fraud that may have been committed by one of the client’s employees. There are allegations that the suspect had moved some of stolen funds to an off-shore tax haven. If you’ve never conducted a foreign investigation before, there could be some significant issues and hurdles that impact the case before it even gets going.
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In September 2018, the European Union Agency for Law Enforcement Cooperation (EUROPOL) released their annual cyber fraud report, the 2018 Internet Organized Crime Threat Assessment (IOCTA). The comprehensive, 72-page report details key findings from EUROPOL’s assessment of the vast amount of criminal intelligence, investigation and enforcement actions information gathered by police and regulators across Europe that deal with fraud and criminal use of the internet. The report notes that the IOCTA has seen a rise in cryptocurrency-related issues year-over-year, but the 2018 report is explicit in the alarm it raises for threat potential.
Published in Fraud Examiner Archives
Peruvian native Tomasita Pazos Aurich, CFE, has been dedicated to spreading fraud awareness and prevention for a long time. Along with forming the ACFE Lima Chapter, and serving as its president, she has also found purpose in spreading anti-fraud education and best practices in the public sector and is now working on a compliance book.
Published in Fraud Examiner Archives
Last year was the ninth consecutive year in which the DOJ recovered more than $2 billion from health care fraud cases. As those numbers indicate, health care fraud continues to be a massive problem in the U.S. A recent settlement illustrates the scope of the problem. On January 22, 2019, the DOJ announced that it had reached a $269 million settlement with Walgreens in two separate fraud cases.
Published in Fraud Examiner Archives
The types of technology these fraudsters use are similar, if not sometimes identical, to other types of cyberfraud that fraud examiners should be familiar with — such as creating fake websites, and spoofing where traffic or data originates. Also, fraud examiners might not think about their organization’s advertising strategy on a regular basis, but this type of fraud has the potential to cost their employer a good deal. Coupled with the fact that many people in the advertising industry aren’t trained to spot fraud, this arena of fraud could be a blind spot for many organizations.
Published in Fraud Examiner Archives
Keith Kauffman, CFE, CPA, has enjoyed a long tenure in the anti-fraud profession. Kauffman, the CFO for Sunbelt Holdings, has been a CFE since 2000 and has made it his mission to show organizations the importance of proactive fraud detection. His latest project, antigaap.com, is an effort to create a new financial reporting method and framework in order to help prevent fraud.
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As many anti-fraud professionals know, the road to justice for fraud victims can be long and costly, if the victims decide to seek justice at all. According to the ACFE’s 2018 Report to the Nations, only 58% of the fraud cases reported were referred to law enforcement and only 23% of cases had a civil suit filed. After a lengthy investigation, many fraud victims think they will never see their money again. However, almost uniquely to England and Wales, there is an avenue beyond criminal proceedings brought by the State or a civil claim: private criminal prosecution. Private criminal prosecution is the right, preserved by statute, of a private individual or company to commence criminal proceedings.
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We often talk about fraudsters being the most trusted and loyal employees, and when I teach about fraud, I have lengthy conversations with the participants about ways to identify these individuals. They often have responsibility, access and authority above and beyond their actual role or job description. We also discuss the chicken or the egg scenario — did they become fraudsters because they were the most trusted and loyal employee, or did they become the most trusted and loyal employee because they were fraudsters and it helped provide them cover?
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In an affluent Connecticut town, where the average home is priced at $1.5 million, two sisters shocked their community when it was discovered that they had been stealing cash totaling nearly half a million dollars from the registers of school cafeterias where they served as lunch ladies. When they weren’t serving sandwiches to students at Saxe Middle School and New Canaan High School in New Canaan, Connecticut, sisters and coworkers Joanne Pascarelli and Marie Wilson operated a cash theft scheme. They are believed to have stolen $478,588 from the two schools from 2012 to 2017, although authorities suspect their fraud dates back even earlier.
Published in Fraud Examiner Archives
Scott Lake, CFE, has a history of helping people. Before he joined State Farm, where he is an audit executive, he worked more than 15 years in law enforcement. “Whether in law enforcement or corporate fraud investigations, I have often been most proud of my work when I realized the outcome had purpose — that it really helped someone right when they needed it,” he said. He recently earned his CFE with the 90-Day CFE Exam Challenge and enjoys taking RV trips with his family in his spare time.
Published in Fraud Examiner Archives
Durable medical equipment (DME) fraud continues to capture the spotlight as one of the leading ways that suppliers and physicians take advantage of Medicare and Medicaid programs in the U.S. DME is defined as supplies or equipment ordered by a health care provider for everyday or extended use.
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Published in Fraud Examiner Archives
The biggest challenge people have when working toward professional advancement is understanding how to communicate the value their expertise and experience can bring to decision-makers. Whether it’s a new job, a promotion, or signing on a new client or customer, the message must be about how your expertise and value solve their problems. The higher up the leadership ladder one climbs, the more important it is to understand how to couch language that engages others, positions your expertise and value, and uses the social proof of influence to gain allies, advocates, clients, customers and followers.
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As school ramps up again for many students, so too does the risk for fraud occurring in colleges and universities. Higher education institutions are just as vulnerable to fraud as many large organizations, and their risk can be exacerbated by the many moving parts required for a university to function. There are various ways in which higher education institutions can be the victims of fraud — including individuals in areas such as athletics, research, admissions and prospective students. Here are some of the recent fraud schemes to be aware of.
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Natina Thalien, CFE, did not set out to fight fraud but found herself deeply interested in it after moving from an internal audit role to compliance. Now a global compliance auditor for Bio-Rad Laboratories, her dual citizenship in the U.S. and France, along with bilingual skills, have helped her spread anti-corruption and anti-fraud education in Europe, Eastern Europe and Africa. She is active in the ACFE France Chapter and is spearheading a campaign to teach children and teens how to protect themselves against identity theft and cybercrime. When she’s not fighting fraud, she enjoys horseback riding, table tennis and gourmet meals.
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One of the most topical subjects since the release of the Panama and Paradise Papers has been how to deal with offshore companies and the issue of their Ultimate Beneficial Owners (UBOs). Unsurprisingly, given the sensitive nature of the subject, many politicians across the world, as well as global NGOs, have been pressing for a means to close what they perceive to be loopholes. These “loopholes” have enabled crooks to evade taxes and launder criminal money. However, as journalist Max de Haldevang reports in an article for Quartz, the American Bar Association (ABA) has been actively lobbying against draft legislation in Congress that aspires to see these loopholes closed.
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Case Study: When a Kickback Turns Deadly
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We all know fraud prevention and detection can be a monumental task. Besides the difficulties of protecting assets — such as cash, fixed assets and inventories — we also need to be aware of other risks, like fraudulent financial reporting, theft of time and vendor kickbacks. What can make implementing and enforcing effective controls even more challenging is when the company’s assets, reporting, employees and purchasing exist in a decentralized setting.
Published in Fraud Examiner Archives
Internet-connected toys are popular because they create an interactive experience for children. Aided by speech recognition software and the ability to search the Internet, they can answer questions and remember your child’s preferences. However, such toys also gather data about children and their parents. They may be equipped with microphones, cameras, data storage components or GPS capabilities. As a result, the toys can collect a wide variety of personal information (e.g., photos, voice recordings, names, birthdates and physical locations). Some privacy advocates warn that toy manufacturers should not be trusted with such sensitive information.
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For several decades, the continually evolving and increasingly more sophisticated anti-fraud profession has lamented the absence of significant, sustained and meaningful white-collar prosecutions of individual executives as a key limiting factor in creating the kind of deterrent necessary to strike a dagger through the heart of corporate fraud.
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“Buyer beware” is a common refrain we’ve all heard before, and it sums up American society’s stance on responsibility in commercial transactions. The onus is on individual consumers to do their due diligence and ensure they know what they’re buying and from whom. It makes sense; if someone can’t be bothered to think before doling out their hard-earned money, why should we bail them out when they make unwise purchases?
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Pseudocide, “the act of faking one’s own death,” has existed and been committed for centuries. There are many scenarios that might come to mind about why and how someone would concoct and attempt to carry out this type of fraud. Some reasons that, to some people, are obvious and others that are beyond fathomable. Often, people who attempt pseudocide lack a true comprehension of the potential consequences of their actions and, in most cases, knowledge of how best to plan for and successfully execute their escapades. Those who attempt this façade come from all walks of life, from ordinary, everyday citizens to notable authors to those in the corporate hierarchy.
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On July 15, a South Korean treasure hunting company called the Shinil Group claimed it found the wreck of a Russian warship, the Dmitrii Donskoi. The ship sank east of the Korean Peninsula more than 100 years prior during a 1905 battle with the Japanese while carrying a cargo of 200 tons of gold bullion, according to Shinil’s claim. The Shinil Group announced the find in a full-page newspaper ad, and also claimed that in 2019 they would distribute dividends worth 10% of the sunken treasure’s value to holders of the Shinil Gold Coin cryptocurrency — available on the newly launched Donskoi International Exchange. The company released a statement two days later that featured photos and video of the shipwreck, including what appeared to be confirmation of the ship’s name painted on the hull.
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Alexander Nanau’s 2019 Academy Award winning documentary “Collective” tells the story of a tragic 2015 nightclub fire that led to the discovery of Romania’s vast health care fraud. Even though the fire was the deadliest in the country’s history, it wasn’t until several victims started dying of non-life-threatening wounds that residents began investigating the links between the nightclub fire deaths and the country’s corrupted hospital industry. The incident sparked outrage over the government’s health care system and inspired a whistleblower to disclose the internal secrets to the media. Nanau’s heartbreaking depiction serves as a rallying cry for whistleblowers to act, especially in cases of life or death.
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A recent case highlighted by the United States Department of Justice (DOJ) involved a $244 million loss incurred by major American meat company Tyson Foods and another unnamed organization with a peculiar commodity at the heart of the fraud scheme: ghost cattle. One might wonder how a company could have lost hundreds of millions of dollars due to bovines from the beyond; or maybe ask whether a ghost cow says “moo” or “boo” instead.
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A four-part documentary series from HBO, “The Lady and the Dale,” is a fast-paced deep-dive into a web of FBI raids, manhunts and a whole lot of fraud. Directors Zackary Drucker and Nick Cammilleri treat viewers to the complex life of Elizabeth “Liz” Carmichael — a charismatic and cunning salesperson with billionaire and presidential aspirations who took the automotive industry by storm when she revealed the bright yellow prototype of a car called the Dale in the mid-1970s.
At the height of the global oil crisis, Carmichael promised interested buyers and investors that this three-wheeled vehicle could get 70 miles to the gallon, and all for the low purchase price of $2,000. Carmichael’s grandiose claims promised to revolutionize the landscape not only of the automotive industry but also of the world at large. This promise, of course, was gradually revealed to be completely empty.
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In another tale of quarantine hobbies that have unfortunately become rife with fraud, the sports cards and memorabilia community has witnessed a massive resurgence of interest in buying and selling valuable collectibles. Predictably, fraudsters are capitalizing on this market bulge. Throughout 2020, when the pandemic relegated everyone to their homes, many people started going through old boxes and finding childhood objects or newly valuable memorabilia. This led to a boom in internet sales of collectibles, with eBay reporting a 142% increase in their trading card category during the year. This amounts to 4 million more cards sold in 2020 than in 2019.
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Have you been searching for that perfect soundtrack for your daily commute? Or for those who are working from home, are you in need of a tale full of twists and turns to liven up your afternoon walk around the block? Luckily, there are plenty of fraud-related podcasts available that fit the bill. We’ve compiled a list of 10 fraud-related podcasts that will have you laughing and learning the whole way through.
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The ACFE is proud to announce that Alexandra Sagaro, CFE, FCLS, and Hannibal “Mike” Ware, CFE, have been elected to the 2021-2022 ACFE Board of Regents. Fellow CFEs elected them from candidates selected by the Board's nomination committee. The two new regents will take office at a virtual Board meeting in February.
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Congratulations to the 24 promising future fraud fighters that have been awarded Ritchie-Jennings Memorial Scholarships this year from the ACFE Foundation. These outstanding students displayed academic achievement in accounting, finance, business administration or criminal justice, and the desire to pursue a career in fraud examination or a similar anti-fraud field.
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The ACFE Board of Regents sets standards to promote professionalism and ensure the reputation of the CFE credential. This year, nine candidates have been selected to compete for three positions on the 2022-2023 Board of Regents.
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“Manually tracking money is no longer the solution for professionals.” - Benjamin Chou
The COVID-19 pandemic has presented rare opportunities to commit fraud. For example, a Florida man obtained loans under the Paycheck Protection Program (PPP) valued at $3.4 million by submitting false IRS records.
Bringing cases like this using manual data handling and analysis is burdensome. To develop the evidence you need against the perpetrator, you need to sort through a mountain of financial data.
As a fraud investigator, you spend so much time preparing the transaction data, you may miss seeing the bigger picture. You may not identify the patterns of money moving in and out that characterize fraud, money laundering and other financial crimes. According to one study, up to 85% of financial crimes involve non-analytical and administrative data handling.
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Reports of all types of fraud have skyrocketed over the past year, with all the bizarre twists and turns, and the arts industry was not immune. As commerce migrated online for auction houses and art fairs, tax evasion, money laundering and wire fraud grew more common in the fine arts business.
While some of the year’s art fraud cases were a result of scammers taking advantage of the vulnerabilities in the system that COVID-19 exposed, a lot of major art world fraud news came after years-long schemes were finally uncovered and fraudsters were finally charged. Here are four major stories that erupted onto the scene.
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The design of effective anti-fraud solutions requires a clear understanding of fraudsters’ psychology. Additionally, a strong grasp of cognitive, emotional, cultural and social dimensions goes a long way in deciphering the modus operandi of criminals.
This is where behavioral economics comes in. If you’re not familiar, behavioral economics studies the decision-making processes of individuals and how their choices differ due to various nuances of emotional states, cognitive ability and personality.
In the context of fraud risk, such subtleties have the potential to illuminate a wide variety of crime trends, which in turn, can aid with your organization’s design of anti-fraud solutions. Here are four ideas from behavioral economics that can help you spot fraudulent transactions.
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In response to the 2008 financial crisis, Congress passed the Dodd-Frank Act in July 2010, which, among other things, created the U.S. Securities and Exchange Commission (SEC) Whistleblower Program. A decade later, the program has proven to be successful in generating high-quality tips that have enabled the SEC to halt fraud schemes and protect investors. Since 2012, the SEC Office of the Whistleblower has issued more than $700 million in awards to whistleblowers. The SEC actions associated with those tips have resulted in orders against wrongdoers totaling more than $2.7 billion.
According to the ACFE’s 2020 Report to the Nations, there has been a notable increase in tips via companies’ hotlines or reporting mechanisms since 2010. While internal reporting can be an effective method of exposing wrongdoing, individuals should consider the SEC Whistleblower Program as another powerful tool in their arsenal. There are five main reasons why the SEC Whistleblower Program is successful in rooting out fraud.
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Kelly Houston, CFE, has worked in local government for 22 years. She began in the sheriff’s office, spent the majority of her career in the finance department and then moved to a newly formed Internal Audit Department in 2018. In addition to her “normal” career, she is also the registrar for the North Carolina/South Carolina International Association of Arson Investigators Conference, the chair of her church’s administrative council, and co-lead for a ministry called “Car Care,” which offers routine maintenance on vehicles for single parents, seniors and disabled people at no cost.
In October of 2020, Kelly signed up for the 90-Day CFE Exam Challenge. However, it was not her first challenge. She joined a previous challenge during the outset of the pandemic, thinking she would have all kinds of free time in the evenings to study. But she was reassigned at work to assist the emergency services department during the day and spent most nights trying to catch up on her regular job responsibilities. Yet Kelly was determined. She continued to study outside of the challenge groups and came to the October-December challenge ready to get her CFE Exam knocked out!
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A recent investigation by VICE found a major loophole in telecommunications infrastructure. Joseph Cox, the investigative reporter at the center of the story enlisted the help of a friendly hacker to report on a service called Sakari, a company that streamlines mass SMS messaging for businesses. The hacker was able to use the service to reroute all of Cox’s text messages to the hacker’s device, and Cox didn’t receive a single notification about the theft of his number. He just stopped receiving text messages.
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The Allen Stanford Ponzi scheme is notorious for many reasons. Stanford’s $7 billion scam, affecting upward of 18,000 victims, was the second largest Ponzi scheme in history, eclipsed only by the huge fraud run by the late Bernie Madoff, who defrauded thousands of investors out of $17.5 billion.
The formerly bankrupt Stanford is currently serving a 110-year sentence in the Coleman II Supermax federal prison in Florida, after living a life of luxury in the Caribbean for two decades off the proceeds of his crime.
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While the U.S. Federal Trade Commission (FTC) exists to put forth pertinent regulations and publish findings, some of its best resources for new marketplace discoveries are consumers themselves. Through consumer reporting, the FTC can identify trends and questionable business practices from the perspectives of those who directly experience them. Consumer reports are stored in the Consumer Sentinel Network (Sentinel). Sentinel is a secure online database available to law enforcement, allowing the FTC’s law enforcement partners to use the information from the database to better enforce anti-fraud laws.
In February of this year, the FTC released their Consumer Sentinel Network 2020 Data Book, which aggregated more than 4.7 million consumer reports made in 2020 and sorted them into 29 top categories. The data is based on unverified reports made to the FTC’s call center or online, as well as reports filed with other federal, state, local and international law enforcement agencies, as well as organizations like the Better Business Bureau and Publishers Clearing House. The Data Book provides illuminating information on how a year defined by the pandemic influenced fraud methods and the trends anti-fraud professionals should expect in the years to come.
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Some months ago, I was hosting a weekly virtual class and talked about the 5Ws and 1H of writing — What, Why, Who, Where, When, and How.
I learned this concept from a former boss while working on an investigation and it’s a tool commonly used by journalists when writing stories, researchers and psychologists when assessing cases. These occupations can be similar to investigators in that they all strive to unearth issues as well as understand the psychology behind an individual’s actions.
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Throughout the pandemic, as more people found themselves quarantined at home and with more time on their hands, many animal lovers turned toward the joys of new dog ownership. However, scammers quickly realized the opportunities to defraud these hopeful pet adopters and worked out a variety of ways to cheat unsuspecting customers out of hundreds of dollars.
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When do we start educating our children about fraud? Our world has changed from the days of warning our children of “stranger danger” — which is the idea and warning that all strangers can be dangerous. It is difficult for some children to understand that not all adults have their best interest in mind. Many parents don’t want their children growing up frightened, but they should aim to protect their personal information. Precisely like adults, children are exposed to the risk of identity theft and fraud. Just surfing the internet can expose both adults and children to online scams, but there are some that specifically target children.
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Every once in a while, a fraud story comes along that leaves us totally befuzzled, either for its hilarious twists and turns, or for the sheer irony of the scheme. We’ve compiled seven of these outlandish tales, so that you might join us in our confusion, laughter and awe.
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Your donation to the ACFE Foundation could change the course of a student's career. Paulina Rocha Salas is a past recipient of the ACFE’s Ritchie-Jennings Memorial Scholarship. Paulina is working towards her accounting MBA program at the Marilyn Davies College of Business at the University of Houston-Downtown in Texas where she is expected to graduate in the summer of 2022. She is currently employed as a senior associate in Weaver’s Forensics and Litigation Services practice.
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E-payment through third-party channels or platforms — like Venmo, Cash App, Alipay or WeChat Pay — is widely used in our daily life, especially as COVID-19 spread and stay-at-home restrictions fueled precipitous growth of third-party payments. To clarify, I’m not referring to mobile banking apps or payment apps operated by the banks. Let’s focus on apps that function independently yet connect consumers, merchants and banks to mold a payment loop.
To understand these risks, let’s take a look at the third-party payment flow and bring out the iterated anti-money laundering (AML) measures as well as the major difficulties to implement them.
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In October, the Financial Crimes Enforcement Network (FinCEN) issued an advisory regarding unemployment insurance (UI) fraud during the COVID-19 pandemic. The purpose of FinCEN’s advisory was to notify financial institutions of the types of UI fraud schemes the bureau has observed during the pandemic, as well as the red flags associated with such schemes.
For obvious reasons, unemployment claims have surged during the pandemic. According to FinCEN, law enforcement agencies and financial institutions in the United States have detected a corresponding surge in UI fraud. The following are the most common types of UI fraud schemes observed by FinCEN during the pandemic.
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As fraud examiners know, fraud comes in many varieties and touches every type of business. Some fraud stories defy belief due to the audacity of the fraudsters, the context in which they occur, or both. These seasonally appropriate examples of frightening frauds show that fraudsters will consider any type of trick when it comes to scamming victims.
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Cryptocurrency is back in the headlines. Amidst a global pandemic that has led to unprecedented increases in the U.S. money supply, institutional investors and publicly traded companies are buying bitcoin at record levels. Seen as an experimental asset class and hedge against inflation, this new wave of investment by organizations is in sharp contrast to the 2017 speculative bubble fueled by retail investors. As a testament to the evolving use cases of crypto by corporations, China’s second largest bank has raised $3 billion in capital using bonds that could be bought or sold with bitcoin, and business intelligence company MicroStrategy (NASDAQ: MSTR) has even adopted bitcoin as its primary treasury reserve asset.
Although we are still in the infancy of crypto, we are likely beyond the point of uncertainty regarding its long-term existence in financial markets. Here are a few predictions on how crypto will continue to face unique risks in 2021 and beyond.
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Anyone waiting in line at the grocery store knows that when the person in front of them pulls out coupons — especially a binder full — they’re going to be there for a while. That ominous binder can only mean one thing: an extreme couponer.
One Virginia Beach couple’s extreme couponing fun turned out to be extreme couponing fraud. Over the course of three years, Lori Ann Talens perpetrated the largest coupon fraud scheme ever discovered in the U.S.
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Although the craze over the social networking game FarmVille is over, that didn’t stop 25-year-old Mehmet Aydin from realizing there was still money to be made on virtual farms. Known as Ciftlik Bank in Turkish, Aydin marketed Farm Bank to be a “win as they play, and have fun as they win” game. At first telling users that they were investing real-world money to care for virtual animals, Farm Bank also offered them the opportunity to earn money back on their so-called investments in return for keeping the virtual animals alive.
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Fraud is nothing new. In fact, fraud has been with us from as far back as 300 B.C. when Hegestratos, a Greek sea merchant tried to sink his empty ship and claim back the nonexistent cargo of corn. Unlike many fraudsters however, Hegestratos’ plan backfired, and he came to a watery end.
Today things are very different. In our increasingly digital world, sophisticated criminal activity is taking advantage of individual and organizational vulnerabilities on an industrial scale. In the ACFE and Grant Thornton’s latest report, The Next Normal: Preparing for a Post-Pandemic Fraud Landscape, 51% of organizations have uncovered more fraud since the onset of the pandemic and 71% of respondents expect payment fraud to increase in the next year. Weaknesses in our global financial infrastructure and a lack of fraud consciousness are generating huge personal and institutional losses.
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As we start a new academic year, we’re highlighting three recent scams that took place in schools so that parents, teachers, administrators, and students can remain vigilant and prevent succumbing to these dubious schemes.
Rogue PTA president proves to be big spender
In July 2021, Tiffany Bell, former PTA president at AZ Kelley Elementary School in Nashville, Tennessee, was indicted on fraud and theft charges after stealing nearly $5,600 from the school’s PTA fund during the summer of 2017. Bell used the PTA’s debit card to make cash withdrawals at ATMs, and to make a series of personal purchases at Walmart, Family Dollar and Kmart.
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During the closing session of the 32nd Annual ACFE Global Fraud Conference, John Gill, vice president of education at the ACFE, spoke with convicted fraudster* Brett Johnson, who shared stories from his life as a cybercriminal. After being placed on the United States Most Wanted List, captured and convicted of 39 felonies, he escaped prison. Captured again, Johnson served his time and accepted responsibility.
In this excerpt from the full transcript of episode 109, Johnson shares some advice for companies as cybercrime continues to evolve and grow.
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In the most recent episode of Fraud Talk, Deidra Jackson, founder and manager of Opus Strategies, discusses the intersection of compliance, ethics and culture when building a diversity, equity and inclusion program within an organization. She shares actionable advice and real-life examples of how to not just check the boxes, but make a real and lasting shift in company culture.
In the excerpt below from the full transcript of episode 108, Jackson illustrates how networking and mentoring can create solid career paths for those belonging to underrepresented groups.
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In the most recent episode of Fraud Talk, the ACFE’s monthly podcast, Mike Ware, CFE and Inspector General for the U.S. Small Business Administration (SBA), discusses the challenges his office faced in preventing and detecting fraud affecting COVID-19 stimulus programs.
In this excerpt from the full transcript, our guest discusses how previous disaster relief programs prepared the SBA for the pandemic as well as some takeaways for other organizations.
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One of the most covered topics so far in 2021 has been non-fungible tokens, or NFTs. In this Fraud Talk podcast episode, ACFE Senior Research Specialist Mason Wilder, CFE, talks to OSINT researcher extraordinaire and artist Kirby Plessas to cover what NFTs are and the fraud implications of their rapid emergence into the public consciousness.
In this excerpt from the full transcript of episode 107 of Fraud Talk, Plessas describes how this new, fast-moving technology creates a ripe opportunity for fraudsters.
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In episode 105 of Fraud Talk, Stephen Griffin, CPA, describes how his professional and personal lives changed after discovering fraud and corruption in a youth sports company.
In this excerpt from the full transcript, Mandy and Steve discuss the red flags that initially alerted Steve to potential fraud, including one harrowing moment in the board room, which ultimately led to a robust investigation.
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Four panelists from a 2021 ACFE Women’s Summit session discuss the ever-evolving threat landscape and how it has affected fraud trends throughout the past year. The panel of speakers included moderator, Amber Mac, along with Amy Chang, Cynthia Herrington and Amber Schroeder.
In this excerpt from the full transcript from episode 106 of Fraud Talk, the panelists discuss how they stay current on new and emerging tech, as well as the impact of COVID-19 on how fraudsters are using tech. Download the full transcript of “Navigating the Threat Landscape in Today’s Tech-Driven World” in PDF form or listen to the episode at the bottom of this post.
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Mason Wilder, CFE, ACFE Sr. Research Specialist, and Mandy Moody, CFE, ACFE Communications Manager, discuss the "sting of the century." Operation Trojan Shield was a collaboration between the U.S. FBI and DEA, the Swedish and Australian police, and other global agencies to infiltrate an encrypted chat platform. The operation led to 800 arrests, seizures of drugs and firearms, and an ongoing list of money laundering revelations.
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In this episode of the ACFE’s monthly podcast Fraud Talk, the president and co-founder of Verracy, Mary Breslin, CFE, discusses a case she investigated where an employee stole $1.8 million after being overly interested in auditing processes. After being tipped off when she saw he purchased an expensive sports car, she shares lessons she learned from the case.
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Episode 104 of Fraud Talk is the ACFE's latest Facebook Live recording during which ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, ACFE Communications Manager Mandy Moody, CFE, and ACFE Senior Research Specialist Mason Wilder, CFE, unveiled the five most scandalous fraud schemes of 2020. The article is available now on Fraud-Magazine.com.
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In this episode, Dr. Vince Haecker, assistant special agent-in-charge for the U.S. Department of the Interior- Office of Inspector General, discusses why it's pivotal to trust your instincts as an investigator and empower those around you to ask questions when something doesn't seem right. He also stresses the importance of communication with other departments in your organization and staying objective while researching.
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In this special episode released during International Fraud Awareness Week, Chris Ekimoff, CFE, CPA/CFF, director of financial investigations and dispute services at RSM and co-host of the inSecurities podcast, and Mandy Moody, CFE, ACFE communications manager, discuss the latest and greatest highlights from the trial of former Theranos CEO Elizabeth Holmes. Chris and Mandy provide background and analysis on the many facets of the Theranos tale, review the implications of the previously-settled matter with the SEC in 2017 and discuss common issues with the legal system regarding allegations of fraud.
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During the 2021 ACFE Fraud Conference Canada, the founder of Sheriff Consulting, Garth Sheriff, CPA, discussed the importance of psychological safety for ethical decision making – and how the lack of it in an organization can lead to disaster.
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Bank records are of particular interest and importance to forensic accountants and receivers, as they reflect an entity’s actual financial history. In fact, bank records can tell a powerful story.
We recently identified bank statements in several of our investigations that were electronically manipulated to reflect deceptive and fraudulent statement entries. Both the descriptions and amounts were changed for electronic payments, such as wire transfers and debit card transactions reflected on statements. In some cases, deposits were altered to reflect greater cash inflows, and the balances were manipulated such that they rolled forward, helping the manipulations go unnoticed.
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The International Consortium of Investigative Journalists (ICIJ) published another investigative report — the Pandora Papers — based on leaked documents that illustrate the complex international financial dealings of politicians, celebrities and other wealthy people who use various means to avoid taxes.
The revelations of the Pandora Papers are not substantially different than those of other alliterative ICIJ leak investigations such as the Panama Papers, Paradise Papers, Luanda Leaks or Luxembourg Leaks. The Pandora Papers show how extraordinarily wealthy people move money through complex international networks of holding companies, special accounts and secrecy jurisdictions to minimize their tax obligations and disguise their ownership of assets as well as large sums of money.
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Wirecard was once a fast-rising European fintech company that grew primarily through acquisitions. Now it’s dubbed the “Enron of Germany.” Its attempts to cover up holes in its accounts resulted in a plummeting stock price and ultimately pushed the company into insolvency. The similarities to Enron are straightforward: gregarious corporate leaders, opaque financial statements and a dogged reporter.
But in Wirecard’s case, Dan McCrum — the investigative journalist who broke the story for the Financial Times and is this year’s winner of the 2021 ACFE Guardian Award — faced unprecedented obstacles and harassment.
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Our profession requires plenty of insight and knowledge to understand the fraud landscape. But it also takes a good measure of moxie. Thulisile “Thuli” Madonsela is one of those unique people who possesses that know-how and fortitude — at an extraordinary level.
Her hard-fought battles against corruption at the highest levels of the South African government only prove this. The ACFE honored that strength in June when we presented Madonsela with the Cressey Award for a lifetime of achievement in the detection and deterrence of fraud.
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In some of the first COVID-19 articles we published nearly a year ago, we warned how the pandemic was creating the perfect storm for fraudulent activity to thrive. Sadly, those predictions have proven true as record amounts of COVID-relief money flood the economy.
To date, the U.S. Congress has approved over $5 trillion in aid packages to help the unemployed and businesses survive the economic impact of the pandemic. That’s the largest federal spending program in U.S. history and, as such, it’s become a veritable playground for fraudsters to ply their trade. It’s also the subject of our cover story for the current issue of Fraud Magazine.
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What you do matters. Over the last year, we’ve seen your impact in powerful and unique ways. In the face of uncertainty, new challenges and evolving risks, you responded quickly and innovatively, reflecting and reimagining at every step. Many of you shifted your teams, your investigations and your anti-fraud programs to a remote approach on a moment’s notice. Some of you were challenged to do more with less, and to effectively prevent and detect fraud, even in the face of budget cuts and staff reductions. You found creative ways to move your engagements forward when the usual approaches were not an option.
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2020 is officially behind us, but its repercussions will live with us for a long time. Nothing prepared us — professionally or personally — for the pandemic. COVID-19 probably has permanently changed the ways we operate. But we’ve been resilient as we work through tremendous disruptions. We’re fighting the good fight to protect our organizations from fraud despite our limitations.
In October 2020, I had the honor of conducting an ACFE webinar with a group of expert fraud examiners to discuss the challenges and difficulties they and their colleagues are facing. The two-hour discussion flew by with the three speakers from consulting, industry and law enforcement sectors. The discussion was so robust, we decided to expand the session to become the January/February issue of Fraud Magazine’s cover story.
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Since the outbreak of COVID-19, daily life has significantly changed. Many in-person activities have been transferred online, and transactions are increasingly conducted solely through digital channels. But even before the pandemic, users were well-accustomed to identity verification and authorization in the digital format. The concept of digital identity is nothing new and was widely implemented at all levels of maturity.
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I've been at the ACFE for more than 25 years, and there’s one topic I’ve been asked about more than any other: How does a fraud examiner avoid declaring guilt or innocence?
Here’s the tricky part. Fraud examiners work in so many different areas, and the rules can be slightly different if you are an expert witness, a member of law enforcement or an auditor.
To clear this matter up, let’s start with the basic rule and a short section from the Fraud Examiners Manual that discusses this topic.
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Securities and Exchange Commissioner Chair Gary Gensler tweeted in August, “Investors want to better understand one of the most critical assets of a company: its people.” As practitioners of investigative due diligence, we observe our client’s prioritization of human capital in their decision making. In the same manner as private-sector firms whose human capital initiatives have been credited with enhancing both profits and public images, due diligence providers stand to benefit considerably by integrating personnel considerations into their current initiatives and future goals.
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A key component of any fraud investigation is the effort to uncover the reason for the fraudulent activity. Anti-fraud professionals are constantly seeking to understand the motivators of fraud, and this 2015 study, funded by the ACFE Research Institute, titled “Is Fraud Contagious? Career Networks and Fraud by Financial Advisors” explores the propensity to commit fraud due to influence by career networks and financial advisors.
In the U.S., the financial advisory industry has a huge impact on the national economy. The industry advises trillions of dollars in assets and generates billions in revenues. Additionally, the industry employs hundreds of thousands of people, many of whom play a pivotal role in the financial well-being of households nationwide. Unfortunately, with such a large role comes inevitable fraud.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by March 31, 2022.
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Bernadette Kakooza, CFE, is more than just an accomplished fraud fighter. As the first female Inspector General for the Detroit Public Schools Community District, she works hard for her geographic community as well as her anti-fraud community. In addition to spearheading investigations to save taxpayer money, she’s an active member of the Southeastern Michigan ACFE chapter and mentors fellow ACFE members.
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Brenda Buetow, CFE, is currently the vice president of internal operations at Financial Center, an Indiana-based credit union. She has decades of experience navigating regulatory compliance. She specializes in FCPA and anti-bribery anti-corruption regulatory compliance, anti-money laundering/terrorist financing remediation and investigation, and BSA/AML remediation. When she’s not investigating fraud, she enjoys camping with her family.
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Christopher Piacentile, CFE, knows the trials and tribulations of being a whistleblower all too well. Not only does he work regularly with whistleblowers at the Daniel J. Ocasio Whistleblower Law Group, he has been a whistleblower himself multiple times. He was the lead investigator for the Apria Healthcare fraud case which settled recently for $40.5 million. He hopes to continue fighting for whistleblowers and helping expose fraud in any way he can.
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In March 2021, Doris Marasembi, CFE, became the first female Papua New Guinean to earn the Certified Fraud Examiner (CFE) credential. As a senior accountant at the Department of Finance Papua New Guinea (PNG), she is responsible for helping ensure the accuracy of pivotal reports that the government uses to shape financial policy. She also plays an active role in her community where she mentors young people.
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After years of working in different sectors, Dr. Radiah Othman, CFE, CPA, decided to turn her attention to educating others in the importance of fraud prevention and detection. She currently is an associate professor at Massey University in New Zealand where she shares stories of her previous work, as well as large fraud cases in New Zealand, with students. She enjoys watching them develop their own passions for fighting fraud and is proud to teach and encourage the next generation of fraud fighters.
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Eduardo Güell, CFE, is just 31 years old, but he has already advanced far in his career. As a newly qualified Certified Fraud Examiner (CFE), he leads a global team of five people in Citigroup’s third-party risk assessment department proactively managing financial, regulatory and operational risks.
Güell has held positions in a number of financial institutions in his native Costa Rica, where he analyzed companies across North and South America, as well as Europe. He has also become an expert in various anti-fraud regulations, including the U.S. FCPA and the U.K.’s Bribery Act, helping Citigroup avoid reputational risks associated with money laundering and fraud. Güell participated in the ACFE Conference Internship Program in 2019.
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Illakkiya Jai Praakaash, CFE, may just be starting out in her anti-fraud career, but she already has an advantage over potential job competitors. She is the first individual, and female, in India to get certified as a CFE while at the article assistant level (akin to an auditing intern). She is motivated by her desire to do the right thing and understands the important role that anti-fraud professionals and accountants play in preventing, detecting and investigating fraud.
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Matthew Stock, J.D., CFE, CPA, is the director of the Whistleblower Rewards Practice at Zuckerman Law. At Zuckerman Law, he leverages his experience as an attorney and external auditor to assist whistleblowers to investigate and disclose complex financial frauds to the government. His practice focuses on representing whistleblowers in reward cases before the U.S. Securities and Exchange Commission (SEC), the Commodity Futures Trading Commission (CFTC) and the Internal Revenue Service (IRS).
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Mauricio Vera started his career as a musician but realized making a living was difficult when having to depend on other musicians. Vera consequently enrolled at Florida International University to pursue a Bachelor of Business degree with a focus on marketing and international business. A few years later, he landed a job with a major cruise line reviewing payment data.
This set the stage for the next evolution in his career: becoming a Certified Fraud Examiner (CFE). Currently, Vera is enrolled at Florida Atlantic University’s School of Accounting Executive Program where he is due to graduate with a Master of Accounting degree in digital forensics and data analytics by the summer of 2021.
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After years of working in the anti-money laundering field, Niclas-Andreas Mueller, CFE, had seen first-hand how closely fraud and money laundering was linked. He used working from home during the COVID-19 pandemic as an opportunity to earn his CFE credential and speak at multiple ACFE conferences.
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Rupert Evill’s background is in investigations, which led him to become a CFE. He now spends as much (maybe more) time working on the preventative side of risk and compliance. Located in Singapore, Rupert started his own company, Ethics Insight, in early-2019, with the mission to democratize access to ethics and compliance support and advice. He has received guidance from others throughout his career and joined the ACFE Mentoring Program to pay it forward.
Lena Lin, CFE, has years of experience in fraud risk management and internal controls at an international bank based in Hong Kong. She has examined internal and external fraud cases, conducted analysis and supported internal enhancements. But other areas have started to interest her, including Regulatory Technology (RegTech), anti-fraud applications and financial crime compliance strategies. She didn’t have too many criteria when she joined the mentoring program, but she knew she wanted someone who understood the culture and region where she does her work.
Here’s how the ACFE Mentoring Program brought these two together and what they’ve both learned and accomplished over the six-month session.
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A fraud case tied to education took some odd twists into the internet’s adult content industry, highlighting financial crime risks that are frequently overshadowed, and understandably so, by concerns related to other illegal activities.
Ralph Puglisi, a 59-year-old accounting manager for a nonprofit organization, University Medical Service Association (UMSA), that supports the University of South Florida’s health care entities, used his oversight of credit cards to embezzle at least $12.8 million over approximately six years.
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The sound of one of Christie’s virtual auction bells in March symbolized a new era in the art world. A digital artist known as Beeple sold a non-fungible token (NFT) that represents his art piece “Everydays: The First 5,000 Days” for $69.4 million, an action unprecedented for not only major auction houses, but also for cryptocurrency and artists of all kinds.
Christie’s said the sale was the first time a digital-only artwork was offered with an NFT that guaranteed its authenticity. Additionally, Beeple’s sale also marked the first time cryptocurrency was used to pay for an artwork at auction. Beeple, whose real name is Mike Winkelmann, said in a statement released by Christie’s, “Artists have been using hardware and software to create artwork and distribute it on the internet for the last 20+ years but there was never a real way to truly own and collect it. With NFTs that has now changed. I believe we are witnessing the beginning of the next chapter in art history, digital art.”
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Enron’s name has become synonymous with corporate fraud across the globe, and its downfall still provides valuable lessons for CFEs. On the 20th anniversary of the company’s bankruptcy, the U.S.’s largest at the time, Fraud Magazine looks back on those events with a cover story by Sherron Watkins, the former vice president at Enron’s mergers and acquisitions group, who courageously blew the whistle on its shady accounting practices. She examines how a company once lauded by business experts deceived the public and what still needs to be done to avoid future Enrons.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by December 31, 2021.
The challenge arms you with study tips and peer support to help you stay motivated and on track to reach your professional goals. Our upcoming challenge starts Friday, October 1, and ends Friday, December 31.
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International Fraud Awareness Week 2021 is now coming to a close and we at the ACFE want to thank everyone who signed up as an official supporter. Supporting organizations from 112 countries around the world took the time this week to raise fraud awareness and share anti-fraud education with people in their communities and workplaces.
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In honor of Black History Month, we’ve gathered member spotlights and podcasts from the past year that highlight the inspiring work of Black ACFE members who dedicate their lives to fighting fraud. The members highlighted here are a just small sample from our global membership. Throughout this month and beyond, we appreciate, support and honor all of our Black members.
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Today, the ACFE is proud to recognize and honor more than 35,000 women who belong to the world’s largest anti-fraud association. In honor of International Women's Day, we’ve gathered blog posts, resources and exclusive profiles from the past year that feature some of the women who dedicate their time, energy and passion to fighting fraud.
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The archer’s paradox explores the idea that in order to hit your target, an arrow has to bend around the bow. In order to achieve this, you must have an arrow with the right flexibility. An organization’s communication related to anti-fraud policies and professional integrity, which can include topics like conflicts of interest, employee code of conduct, insider information, managing confidential information, whistleblowing and hotlines, and more, should aim to tackle and reduce fear, nervousness and whispers. Every individual within an organization should feel comfortable bringing up a potential ethics issue.
So if the aim of your organization’s communication is to remove fear, think of the archer’s paradox. Your communication should be flexible, willing to bend and reshape through constant communication, as well as by demonstration of what is being discussed. Just like an arrow bends back and forth several times before meeting its target, we need to repeatedly discuss, train and remind employees of our values in order to advocate the importance of professional integrity.
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Throughout 2020, the number of online chess platform users surged, in part because professional players were forced online due to social distancing restrictions that made in-person tournaments impossible, but also because of a horde of novice players who discovered chess as a new quarantine hobby. This vast swath of players only increased after the release of Netflix’s popular limited series “The Queen’s Gambit,” which tells the story of a young woman facing off against much older masters.
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On June 15, 2021, the FBI’s Internet Crime Complaint Center (IC3) released its 2020 Elder Fraud Report. According to the report, victims over 60 reported nearly $1 billion in fraud-related losses in 2020, which represents 28% of all losses reported to IC3. The average loss for seniors was $9,175, and nearly 2,000 senior victims lost more than $100,00. The top three fraud schemes reported by seniors in 2020 were extortion schemes, nonpayment/nondelivery schemes, and tech support fraud. The type of scheme that accounted for the greatest amount of loss was confidence fraud/romance schemes.
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Never before in the history of the world or business has this much data existed. Today’s data includes everything from basic and general information on customers to much more sensitive, personally identifiable data. This data helps businesses do their work more efficiently, but it also creates the risk that sensitive data may leak to third parties that might want to use this information for malicious purposes. In response to this threat, governments worldwide have begun tightening the rules and regulations that govern the use of data. The most prominent of these regulations is the General Data Protection Regulation (GDPR) that was introduced by the EU to protect the data of its citizens. In turn, this has created the need for businesses to invest in better practices when it comes to working with and destroying customer data.
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For me, one thing that came about during the pandemic is that my husband and I love watching movies together. We both have our favorite genres. He prefers the shoot-’em-up action thrillers. I enjoy comedies and dramas. But I especially enjoy a movie that involves parts of my career in the anti-fraud profession.
Recently, on an ACFE Community discussion post, a question was posed: What is your favorite fraud movie?
Well, here are the results of that post, as well as me posing this same question on the ACFE LinkedIn page. I list these in no particular order, only that they are the top five mentioned in both surveys*.
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The news appears promising. Imed Boukhriss, the president of the National Anti-Corruption Commission (INLUCC) of Tunisia declared to the press that the INLUCC is about to launch digital fraud investigation tools to combat illicit enrichment.
According to the Tunisian Law, more than 10,000 government officials, elected representatives, board members and politicians are called upon to sign a statement acknowledging their assets, liabilities, income and interests. This is a self-declaration, meaning that individuals have no obligation to submit any documentation or proof. They have to sign a statement at each appointment, resignation or termination.
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Every year hundreds of companies around the globe join us to combat fraud. International Fraud Awareness Week is a time where we release new resources, infographics, educational videos and social images that organizations can use for anti-fraud education. This is the perfect time to start discussions with your peers, coworkers, executives and stakeholders in your community on the importance of fraud prevention.
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It’s been a year since the pandemic began and changed the way we work and live. As we all know, one of the key changes to organizations was the migration to remote work. Remote work was not new, but when global health concerns overtook other matters, the virtual world became the go-to solution, thus putting enormous pressure on the existing system of work.
In reviewing organizations, one of the interesting revelations I have come across is how insightful Fraud Risk Assessment (FRA) can be in managing fraud risks. If prevention is better than cure, why wait for issues to occur before acting? Anti-fraud professionals should understand fraud risks and march forward through the following.
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In February 2021, an enormous compilation of breached user data was posted on a popular online hacking forum. Known as the Compilation of Many Breaches (COMB), the data leak is believed to be the largest compilation of its kind. The COMB data leak is so big, in fact, that it could include the data of 70% of internet users worldwide.
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Investigative interviews can be a vital piece of any fraud examination, and getting an interview’s mechanics right goes a long way toward improving prospects for the interview’s success. Unfortunately, there is no one-size-fits-all template that fraud examiners at any organization can follow to guarantee an optimal setting for every interview.
One aspect of an interview’s setting that can prove difficult for fraud examiners to navigate is the question of how many people should participate in an interview and which personnel should or should not be allowed to sit in on an interview. Answering these questions will involve several important considerations, which are discussed below.
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Attention ACFE members, you’re invited to join the Mentoring Program!
The ACFE Mentoring Program connects ACFE members to anti-fraud professionals from all over the world who can offer a wealth of resources, experience, advice and guidance. Here are some basics about the program and how it works.
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If you have the CFE Exam Prep Course or are planning to purchase it soon, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by June 30, 2021.
The challenge arms you with study tips and peer support to help you stay motivated and on track to reach your professional goals. The next challenge begins on Thursday, April 1, and ends Wednesday, June 30.
We’ve heard from members that preparing for the CFE Exam can seem a little daunting at first, so the challenge is designed to help you break down and work through the CFE Exam Prep Course materials to successfully complete the exam in three months.
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David Rodriguez, CFE, CPA, CIA combined multiple study techniques to pass the 90-Day CFE Exam Challenge. Here he outlines how he succeeded using the challenge group, different study methods and support from others in the ACFE Community.
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Reuters recently reported that more than half a dozen British banks were in advanced talks with law enforcement and government agencies over plans to systematically share intelligence on major financial crimes such as money laundering and terrorism financing.
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Today brings both sadness and joy as the Association of Certified Fraud Examiners bids farewell to outgoing President and CEO Bruce Dorris, who leaves the ACFE to take some time for himself and his family before beginning the next chapter of his career.
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Artificial intelligence (AI) is rapidly changing the world, and India is no exception. AI is being used in a variety of industries, including finance, healthcare and retail. It is also being used to create new forms of fraud, which are becoming more sophisticated and difficult to detect.
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Artificial intelligence (AI) itself is not inherently fraudulent. AI is a field of computer science that focuses on the development of computer systems that can perform tasks that typically require human-like intelligence, such as learning, problem solving and decision making. AI technologies are used in a wide range of applications, including speech recognition, language translation and image recognition.
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In the ever-evolving landscape of technology, artificial intelligence (AI) has become a powerful tool with the potential to revolutionize industries and streamline processes. However, like any tool, AI can be wielded for malicious purposes. Fraudsters are increasingly leveraging AI to enhance the efficiency and sophistication of their scams.
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Secretive and exclusive, Antwerp has been the heart of the global diamond trade since the 15th century when the Belgian city was the commercial heart of Europe, with 40% of world trade crossing its ports via old trade routes connecting Venice to Lisbon. According to the Antwerp World Diamond Center (AWDC), about 1,700 companies and 4,500 traders concentrated in an area of about one square kilometer trade 84% of all rough diamonds worldwide. Although facing competition from India and the Middle East, Antwerp’s multi-million-dollar deals are still concluded with a handshake and the Yiddish words “mazel und broche” (“luck and blessing”). Are we certain diamonds are a blessing for all?
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The Ritchie-Jennings Memorial Scholarship provides an opportunity for students to advance their education and anti-fraud career paths. Additionally, it supports their anti-fraud interests by providing a full year of ACFE membership. Award amounts are $10,000, $7,500, $5,000 and $2,000 and are paid directly to the recipient’s university or college.
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Multi-level marketing (MLM) companies have been around for decades, but they have recently gained popularity in the health and wellness industry. You’ve seen these companies promoting on social media, like the ubiquitous “Hey hun!” in your Facebook Messenger, or perhaps even approaching you in public squares and asking to join their “exclusive” club, buy their product or join their workout group. Keywords and phrases can include: “detox” (you have a liver and kidneys for that), “lose weight fast” (diet, exercise and your doctor are your best bets here), or the worst, “cure your [ailment] with a simple supplement.”
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This blog serves as part two in a three-part series on Benford’s Law. To read part one, click here. Benford’s Law is one of the most interesting things that so many don’t know about — it feels like a trick, but it’s simply a law that applies for no apparent reason. Benford's Law is a theory that says that in lists of numbers, the first digits of the data set follow a pattern, i.e., random numbers aren’t always as random as you think they are. For more information about Benford’s Law, please see the previous blog in this series, Benford’s Law: What It Is and Why Fraud Examiners Use it.
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Conventional wisdom suggests that each digit has an equal chance of being the first digit, but Benford's law shows that lower numerals always have a greater chance at being the leading digit compared to higher numerals. Counting jobs start with low numbers and progress to include increasingly higher numbers; for example, when counting to 25, 11 numbers have a leading digit of 1, seven numbers have the leading digit of 2 and only one number leads with the digit 3.
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Benford’s Law can be a tricky concept to grasp at first. Here are the basic things to remember: It relies on the idea that the distribution of digits in multi-digit natural numbers is not random; instead, it follows a predictable pattern. More on that later. It applies only to “natural numbers.” The definition for natural numbers and non-natural numbers in a fraud examination are different than they are in math, so don’t let that throw you off. Here’s how we define them for Benford’s Law.
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Recently, I worked on a case wherein a loan account of a bank turned bad, otherwise known as a non-performing asset. A preliminary investigation was conducted to know the genuine reason for the degradation of the loan account. The allegations included the diversion of the fund by the borrower, trade-based money laundering (TBML) through letters of credit and improper monitoring of the account by the bank.
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Medicare fraud poses a significant threat to the integrity and sustainability of the Medicare program. Various estimates suggest Medicare fraud drains up to $60 billion from the healthcare system each year. This massive level of fraud not only harms taxpayers but also jeopardizes medical care for the 59 million Americans who rely on Medicare. With 10,000 new Medicare enrollees daily and rising healthcare costs, addressing fraud is crucial for Medicare's future solvency and ability to deliver service
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The name Frank Abagnale Jr. is synonymous with check fraud and counterfeiting. His story, which was popularized in the 2002 film "Catch Me If You Can," starred Leonardo DiCaprio as the master imposter himself. Starting when he was just a teenager in the mid- to late-1960s, Abagnale managed to defraud banks and businesses out of more than $2.5 million by forging fraudulent checks.
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Diversity, Equity and Inclusion (DEI) is a term that is often tossed around within companies and organizations, but what does it mean? The formal definition of DEI is “a conceptual framework that promotes the fair treatment and full participation of all people, especially in the workplace, including populations who have historically been underrepresented or subject to discrimination because of their background, identity, disability, etc.” It’s often used to describe policies and programs put in place to highlight and recognize the representation and participation of different groups of individuals.
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A new phishing scam preying on Best Buy customers is making the rounds. The fraudulent email claims to be from Best Buy's tech support team Geek Squad and tricks users into giving away personal information. Do not take the bait — this is what you need to know to avoid becoming a victim.
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This new update to the CFE Exam Prep Course makes studying for your CFE Exam an easier process with integrated lessons and Knowledge Checks to ensure you are gaining the most from your study time.
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In the ever-evolving landscape of fraud, staying informed about emerging trends is not just a choice — it is a necessity. As professionals in the field of fraud prevention, we understand that knowledge is our most potent weapon against the ever-adaptive tactics of fraudsters.
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The first thing to admit is that we’ve all probably done it. There, secret’s out. What is it, exactly? We’ve commented on one of those posts or clicked on one of those sites asking for seemingly inconsequential information in order to determine our elf name or which alcohol goes with your personality. Even seemingly more innocuous, “Who is your favorite actor?,” “How long have you been married?” or “What movie can you watch over and over again?” Most of these clickbait quizzes appear harmless at the surface, but the more often you respond, the more you inform social media algorithms that in turn show you similar posts more frequently.
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Fraud is a pervasive issue that affects businesses, organizations and individuals across various industries. Often, an organization is surprised to find itself a victim of fraud, especially when the perpetrator is a trusted employee. According to the Association of Certified Fraud Examiners Occupational Fraud 2022: A Report to the Nations, organizations lose approximately five percent of revenue to fraud each year with the average loss per case totaling more than $1.78 million.
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Anna Sorokin, the so-called “fake German heiress” (perhaps better known by her alias Anna Delvey), came dangerously close to duping a hedge fund out of $25 million. According to The New York Times, she intended to defraud the financial institution by creating fake bank statements in Adobe Photoshop, a task that she said took “surprisingly little time.”
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Federal law does not explicitly criminalize falsifying business records, but the act is criminalized under several federal regulations. Additionally, many states consider it a crime and sometimes prosecute it with other crimes, such as grand larceny or insurance fraud. In New York, falsifying business records is not an uncommon charge and can be either a misdemeanor or a felony, depending on the circumstances. The aggravating circumstance occurs when the “intent to defraud includes an intent to commit another crime or to aid or conceal the commission thereof.” One example of this is changing a record to cover larceny.
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In this article, I want to share something very important: financial literacy. According to the Wiley Online Library, “Financial literacy is the ability to use knowledge and skills to manage financial resources effectively for a lifetime of financial well-being" Sounds pretty useful, right? But how do we learn financial literacy? And when should we start?
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The pharmaceutical industry is heavily regulated due to its impact on public health. Despite strict regulations in India, drug diversion to the normal market remains a persistent problem, compromising patient safety and industry credibility. Diversion refers to the sale of pharmaceutical products outside authorized channels, resulting in unsafe or counterfeit products entering the market.
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Indigenous peoples around the world face marginalization and exploitation, leading to increased vulnerability. This puts them at a particular risk for fraud, as opportunistic fraudsters take advantage of systemic inequalities. Fraud against indigenous communities is especially harmful due to the unique challenges these groups face. Factors like geographic isolation, lack of access to resources and cultural marginalization leave indigenous peoples vulnerable to exploitation in ways other groups may not experience.
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In the third webinar of the Fraud Perspectives series, presented by the Association of Certified Fraud Examiners (ACFE) and The Institute of Internal Auditors (IIA), Mason Wilder, Research Manager at the ACFE, chatted with Kishan Patel, CIA, CITP, CPA, and Chris DeAngelis, CFE, about nonfungible tokens (NFTs) and their role in the current anti-fraud landscape. A confusing and often abstract concept, NFTs have made headlines recently as an innovative new technology with the potential to revolutionize various industries. While NFTs offer numerous benefits, such as increased security and unique ownership, they also present new fraud risks. Understanding these risks and how to mitigate them is essential for organizations that are considering investing in NFTs.
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I attended this webinar from my office, formulated the coverage plan on my commute and wrote this article from my home office. This is the current remote or hybrid reality for many in the professional realm in this post-COVID-19 world. Mason Wilder, the Research Manager at the Association of Certified Fraud Examiners (ACFE), sat down with Steve Dawson, CFE, CPA, President of DFG Forensic Accounting Services, and James Rumph, CFE, CIA, CPA, Senior Director of Enterprise Anti-Fraud Nationwide, for a virtual webinar hosted by the ACFE and The Institute of Internal Auditors (The IIA). The virtual audience was comprised of more than 50% hybrid employees and almost 40% fully remote, which embodies a very real culture shift in the post-pandemic professional workforce.
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In this episode of Fraud Talk, the ACFE's Chief Training Officer John Gill sat down with Charles Antonucci, the former president of The Park Avenue Bank, who was convicted in 2015 of trying to defraud the Troubled Asset Relief Program (TARP). Antonucci also pleaded guilty to other charges including self-dealing, bribery, embezzlement of bank funds, and a multi-million fraud scheme involving an insurance company. The ACFE does not compensate convicted fraudsters.
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In this episode, Jenny Radcliffe, aka "The People Hacker," discusses her expertise as an ethical social engineer, honing those skills at an early age on the streets of Liverpool, and unique challenges she has faced over the years. Joining ACFE Community Manager Rihonna Scoggins during Women's History Month, Jenny explains how being a woman in her field and gender biases she has observed played a significant role in understanding the "human element" behind social engineering. Her new book "People Hacker: Confessions of a Burglar for Hire" is available now in the U.K.
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With addiction being the most severe form of Substance use disorder (SUD), symptoms can range from moderate to severe. In 2021, drug abuse was added to the list of high-risk situations by the Government Accountability Office (GAO). GAO high-risk list are areas susceptible to increased fraud, waste and abuse.
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A new estate fraud case is center-stage in South Carolina’s courts. The Palmetto state has been a hotbed of probate, trust and conservator fraud cases dating back more than half a decade: In March 2023, attorney Alex Murdaugh was convicted of murdering his wife and son. But years before the high-profile attorney was tried for murder, Murdaugh was tied to the disappearance of $4.2 million of his client’s insurance money, of which he was a trustee. Months before the Murdaugh trial, Russell Laffitte, the CEO of Palmetto State Bank, was convicted of fraud in federal court for using the money of his trust clients to make loans that were hidden from and did not benefit his trust clients.
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February is Black History Month, a time when we celebrate the contributions and achievements of Black Americans throughout history. As we reflect on the past and present struggles of the Black community, it's important to highlight and support organizations that are actively working to make a difference.
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Picture a busy city street, littered with parked cars. One, a slate-grey 1998 Oldsmobile, is in real rough shape: sitting up on cinder blocks, the vehicle is surrounded by a sea of shattered glass. All four of its wheels are gone. Then, adding insult to vehicular injury, someone has carved the word “nasty” into the hood.
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White-collar crime, an insidious and complex category of offenses, extends far beyond the conventional image of criminal activity. Understanding white-collar crime is crucial for individuals and finance, law and security professionals in our interconnected world. This guide delves into the multifaceted landscape of white-collar offenses, illuminating the covert operations that underpin them.
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The head of Peru's judiciary, Javier Arévalo Vela, recently publicly highlighted Peru's success in recovering the proceeds of corruption and related financial crimes through its non-conviction based forfeiture law, Extinción de Dominio.
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As the modern fascination with true crime escalates, perhaps no documentarian today presents the stories of our past with more profundity than Joe Berlinger. The Acadamy Award-nominated director boasts a filmography that includes “Brother’s Keeper,” the “Paradise Lost” trilogy and “Tony Robbins: I Am Not Your Guru.” In recent years, Berlinger partnered with Netflix to create and direct the “Conversations with a Killer” documentary series that uses depositions from serial killers Ted Bundy, John Wayne Gacy and Jeffrey Dahmer to retell their gripping stories—a calling card of sorts that has become Berlinger’s style.
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Armed with an innate passion for justice and a keen understanding of the criminal mind, Allison Benkert has carved a remarkable career path dedicated to unraveling fraud, seeking truth and ensuring accountability.
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After graduating from the University of South Florida with my Bachelor of Arts in Criminology, I obtained my first role as a store loss prevention detective. Being on the front line of theft and fraud, I quickly saw the impact that fraud and crime can have, not only against corporations, but against people. For me, it’s all about your impact on people and society. Retail workers must execute a business’ strategy to be profitable while executing multiple responsibilities for an organization. When you see others taking advantage of profits while your business partners are putting in such efforts, it was easy for me to become passionate about combatting fraud. Fraud is like a puzzle that needs to be solved. Taking ownership and pride in my work, while solving the puzzle with integrity, enforces my passion for making a positive difference in society.
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Aristotelis Konstantinos Koufos and Francesca Gabella, CFE, a dynamic duo united by their shared passion for fraud prevention and audit, take us on an insightful journey through their mentor-mentee relationship and their experiences in the ACFE Mentoring Program.
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In January 2024, the Association of Certified Fraud Examiners (ACFE) will launch a bimonthly newsletter we have aptly named after you, The Fraud Examiner. This exclusive resource marks a consolidation of our three existing newsletters into a unified, comprehensive source of knowledge and insights aimed at empowering you in the fight against fraud.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by December 31, 2023.
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Often linked to organized crime, white-collar crimes pose a persistent challenge today. These are usually nonviolent crimes like identity theft, mortgage fraud, computer crimes and tax evasion. To bring the culprits to justice, it's important to prosecute them rigorously.
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Tax season can be a stressful time for many people, and it's important to be vigilant in order to protect yourself from tax preparer fraud. By following these tips, you can help protect yourself from tax preparer fraud and ensure that your tax return is accurate and handled properly. If you suspect that you've been a victim of tax preparer fraud, contact the IRS immediately.
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As we commemorate the anniversary of the Americans with Disabilities Act (ADA), it's crucial to reflect on the progress we've made and the challenges that still lie ahead. One such challenge is the prevalence of fraud schemes that disproportionately affect the disabled community.
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In recent years, fraudulent schemes have been on the rise, evolving constantly in their modus operandi. To counter this growing threat, information sharing mechanisms related to fraud detection and prevention have advanced significantly. Notably, an increasing number of fraudulent information-sharing initiatives are now adopting a public-private partnership approach, involving cooperation between government agencies, law enforcement and private sector entities.
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Allow us to introduce Hasmik Meloyan, one of the latest recipients of the ACFE Ritchie-Jennings Memorial Scholarship. Hasmik's journey is a testament to her relentless pursuit of academic and professional growth, all aimed at making a significant difference in the anti-fraud arena. From her early days as an audit intern at KPMG Armenia to her current role as a risk management specialist at the Central Bank of Armenia, Hasmik embodies the values and mission that the Ritchie-Jennings Memorial Scholarship seeks to promote.
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Meet Jordan Newman, a driven individual who received the prestigious Ritchie-Jennings Memorial Scholarship for excelling in his professional and academic pursuits. Along with being a full-time tax accountant at Pace & Company, he is also a graduate assistant at the Georgia Southern School of Accountancy where he works as a writing assistant and tutor. Jordan recently obtained his CPA designation in the state of Georgia and is now pursuing his Certified Fraud Examiner (CFE) credential. Currently, Jordan is a Master of Accounting student at Georgia Southern University.
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Co-published by the Committee of Sponsoring Organizations of the Treadway Commission (COSO) and the Association of Certified Fraud Examiners (ACFE), the Fraud Risk Management Guide provides direction for creating a comprehensive program to manage fraud risks within an organization. The first edition of the Fraud Risk Management Guide was published in 2016, building on the COSO 2013 Internal Controls—Integrated Framework, which outlined 17 principles associated with five internal control components. This resource provided guidance for designing and implementing systems of internal control and defined requirements for effective internal control.
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Pride Month is celebrated every June as a time to honor, support and raise awareness of the LGBTQ+ community. The history of Pride Month dates back to the Stonewall riots in June 1969, which sparked the modern LGBTQ+ rights movement. Today, Pride Month is a time to celebrate the achievements of the LGBTQ+ community and to advocate for greater equality and acceptance. For those who identify as LGBTQ+ or are allies, it's an opportunity to learn more about the community and support their rights.
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Every year, the Association of Certified Fraud Examiners (ACFE) recognizes the outstanding achievements of anti-fraud professionals around the world. The ACFE Awards embody the very best of our profession and honor the efforts of people whose goal is protecting businesses and individuals alike from fraudsters.
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Around two millennia ago, human civilizations began employing financial mechanisms akin to today's checks. Such tools included the prescriptions of Ancient Rome, the Adeshas of Ancient India and the letters of credit utilized by Ancient Persians. To circumvent the issues of carrying bulky coin pouches and potential theft, Arab merchants devised the sakk, a paper instrument that facilitated the deposit of money in a bank in one country and its withdrawal in another.
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Natural disasters like hurricanes and wildfires are devastating events that leave communities grappling with loss and destruction. While the focus is often on immediate relief and recovery, there is another aspect that frequently goes under the radar: the surge in fraudulent activities that exploit the chaos and vulnerability of these situations. In the aftermath of events like Hurricane Idalia and the wildfires in Hawaii, it is crucial to be aware of the various types of fraud that can emerge.
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The investigative process is essential for uncovering crimes, particularly white-collar crimes. These are crimes committed by individuals, organizations or public officials for financial gain, often without resorting to violence. Edwin Sutherland, one of the pioneers in this field, recognized the complex nature of these offenses.
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This investigative piece peels back the layers of this mysterious phenomenon, focusing on a compelling case study involving Sam Bankman-Fried, a prominent figure in the cryptocurrency landscape, whose financial dealings have raised eyebrows and questions about the integrity of modern financial systems.
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The U.K.’s Economic Crime and Corporate Transparency Bill made its way through the House of Commons and, more recently, the House of Lords. As the bill approaches becoming law and faces only a few final steps before being law, an analysis of details and slated changes is timely.
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In the ever-evolving landscape of the digital world, influencer marketing has taken center stage as a powerful tool for brands and businesses to reach their target audience. However, with great power comes great responsibility, and as the industry continues to grow, so does the potential for fraud. Let's delve into the world of influencer fraud and explore its many faces, consequences and potential solutions.
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The internet is a vast repository of information, with billions of web pages and websites documenting the digital footprints of people and organizations. However, as regular internet users know, web pages are not always permanent. Some are taken down, while many others are deleted or modified over time. This is where the Wayback Machine comes into play. As part of the Internet Archive, a non-profit digital library founded in 1996, the Wayback Machine contains a historic log of an estimated 735 billion web pages, making it an incredibly powerful database supporting a range of businesses and industries.
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The Association of Certified Fraud Examiners (ACFE) is proud to announce that Kimberly A. Howell, CFE, Maheswari G. Kanniah, CFE, and Robert J. Smolich, CFE, have been elected to the 2024–2025 ACFE Board of Regents. Fellow Certified Fraud Examiners (CFEs) elected them from candidates selected by the Board's nomination committee. Smolich, Kanniah and Howell will take office in February 2024.
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Multi-level marketing (MLM) companies and pyramid schemes share similarities like recruitment-focused structures but have key differences, such as the sale of products in MLMs versus pyramid schemes that redistribute payments and fees to early investors.
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Booking a vacation rental online comes with the convenience of browsing listings from the comfort of home. But it also opens the door to scammers trying to take advantage of unsuspecting travelers. Vacation rental fraud often involves fake property listings, compromised accounts, bait-and-switch tactics, double bookings and other deceptive practices targeting short-term rental guests. Being aware of the common types of vacation rental scams and red flags can help you identify fraudulent behavior and even avoid becoming the victim.
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In the world of corporate espionage, uncovering the truth can be a daunting task. But when a global research firm approached us to investigate the simultaneous resignation of two key employees in the latter half of 2020, we knew we had our work cut out for us. The management suspected that the employees were leaving to join a competitor in the same region and requested an eDiscovery review to determine the truth.
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Investing in any business can be a risk, and unfortunately, some investors fall victim to fraudulent schemes. We helped a group of investors who had invested USD $100 million in an educational institution providing coaching services for competitive examinations. The investors were concerned about the institution's operations and suspected that their funds were being misused. Our team of experts took on the case, employing a range of techniques and procedures to uncover the truth.
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Patient Assistance Programs (PAPs) provide free or low-cost medications to eligible patients who cannot afford them. Despite regulatory oversight, instances of PAP fraud have been reported globally.
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Toward the end of the spring season, our team was contacted by the internal audit head of a global retail organization who requested that we investigate several abnormal transactions in a recently acquired subsidiary, referred to as "PQR," located in the western region of India. During a detailed discussion with the IA Head, he provided us with a brief overview of the anomalies, which included irregular transactions that were restated as follows:
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As the landscape of financial crime continues to evolve, financial institutions must stay vigilant and prepared to address emerging risks. In this regard, aligning anti-money laundering (AML) programs with the Financial Crimes Enforcement Network (FinCEN) AML Priorities becomes crucial. This article explores the significance of integrating the FinCEN AML Priorities into AML programs and provides step-by-step suggestions to ensure preparedness for regulatory examinations.
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The ACFE Board of Regents sets standards to promote professionalism and ensure the reputation of our association as well as the Certified Fraud Examiner (CFE) credential. The Regents have sole authority over the admission of members, including, but not limited to, examination standards. They also establish Continuing Professional Education (CPE) requirements and are responsible for establishing, modifying and enforcing the CFE Code of Professional Ethics, as well as all other matters necessary to maintain the high standards of the ACFE. This year, nine candidates have been selected to fill three positions on the 2024-2025 Board of Regents.
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Although well-intentioned, the U.K.’s fiscal response to the COVID pandemic has been seriously flawed, creating huge opportunities for fraudsters to exploit multiple shortcomings of the various schemes offered by the government to help support businesses.
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Behavioral biometrics is a modern method of identifying individuals based on the way they interact with devices, such as computers and smartphones. It is used to verify the identity of an individual through the analysis of patterns of human behavior, such as mouse movements, typing speed and pressure on touchscreens. Unlike traditional biometric methods, such as fingerprint scanning or face recognition, behavioral biometrics does not require any physical input from the user, making it a more convenient and less intrusive form of identification.
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In 2015, Corinthian Colleges, the for-profit education chain that operated schools such as Everest College, shuttered its network of campuses for good. The chain’s demise came following allegations that it falsified job placement records and graduation rates, causing the U.S. Department of Education (DOE) to deny it access to federal student loan money. Thousands of students were not only left without degrees, but also mired in debt.
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This past Tuesday, March 8, the ACFE recognized more than 28,000 female anti-fraud professionals in honor of International Women's Day. We created a page on our website to share articles, resources and profiles of the women dedicating their time to fighting fraud. This page will stay up year-round, and we look forward to adding more resources throughout the year.
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Fraud is always an unfortunate occurrence that shakes the confidence of its victims. They often doubt themselves and wonder how they could have missed the signs. While every type of fraud is damaging to the psyche of those fleeced, insult is added to injury when victims are defrauded by friends or loved ones. In honor of the Ides of March, the infamous day Julius Caesar was stabbed by members of the Roman Senate led by his friend Brutus, let’s look at some fraud cases where personal betrayal may have hurt more than the loss of money.
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While it may seem like a lower-level scam, gift card fraud has real consequences for retailers. An analysis of data drawn from the Federal Trade Commission’s Consumer Sentinel database found that gift card scams have led to a consumer loss of $148 million. Both the Federal Trade Commission and the 2023 National Retail Security Survey have reported increases in gift card scams in recent years. More specifically, 57% of the 177 retail brands responding to the National Retail Security Survey reported an increase in gift card scams from 2022 to 2023.
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February is Black History Month, a time when we celebrate the contributions and achievements of Black Americans throughout history. As we reflect on the past and present struggles of the Black community, it's important to highlight and support organizations that are actively working to make a difference.
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The 2024 Anti-Fraud Technology Benchmarking Report, developed by the Association of Certified Fraud Examiners (ACFE) in partnership with SAS, highlights a significant trend in the fight against fraud. Drawing on survey data from nearly 1,200 ACFE members, this report underscores the growing interest and gradual adoption of generative artificial intelligence (AI) and machine learning (ML) in anti-fraud measures.
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One important distinction of the Association of Certified Fraud Examiners (ACFE) from other associations is the diversity of our professional base. Most members of accounting organizations, of course, are accountants. Internal auditors have a group dedicated just to them. Bar associations are comprised of attorneys. Physicians fill the rosters of medical associations.
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Finding work in the fraud examination field can be very challenging, but this blog may help provide some perspective and ideas on how to stay motivated and resilient during a difficult job search. Be strategic in your approach to career development and use a proven methodology to help.
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Each year, the Association of Certified Fraud Examiners (ACFE) honors outstanding individuals and organizations who make significant contributions to fighting fraud. The ACFE is proud to recognize these exceptional individuals for their invaluable service in the ongoing fight against fraud through the ACFE Awards. Nominate a fellow ACFE member or local chapter for one of the ACFE’s prestigious awards by March 8, 2024.
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In the continued pursuit of reducing fraud worldwide, the Association of Certified Fraud Examiners (ACFE) has joined the Anti-Fraud Collaboration (AFC) as its newest member. This milestone and strategic partnership will strengthen shared goals of both organizations and provide resources that support efficient and effective financial fraud risk management programs across all industries.
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There appeared to be an overwhelmingly substantial number of “high loss” fraud schemes being perpetrated in 2022 (as reported by the Federal Trade Commission). This was shocking as it appeared to show more high loss cases than low loss cases. This would signal a marked departure from decades of historical statistics. Statistics we, in program oversight, rely upon to strategize our anti-fraud endeavors.
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Online shopping is at an all-time high. According to a study from Mastercard, online shopping has spiked by 57%, while the fraud prevention firm Kount’s spring 2020 report found that online transaction volume had increased for wellness and vitamin products, sporting goods, and wine and liquor by 91%, 599%, and 900% in comparison to 2019 numbers.
As online activity has increased during global self-isolation, unfortunately so has the rate of cyberfraud, phishing and account hacking. Here are 10 tips to help you stay safe while shopping online.
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With colleges and universities weighing options to conduct classes in person or virtually this fall, students no doubt already have a fair amount of stress regarding the upcoming semester. Whether classes are online or not, an estimated 70% of students will likely take out student loans to help finance their continued education. According to Student Loan Hero, 69% of 2019 graduates who took out student loans entered post-grad life with an average $29,900 accumulated in student loan debt. Nationwide, there is currently over $1.5 trillion accumulated in student loan debt. Loans and financial aid are already such great sources of anxiety, so here are three of the most common student loan scams to avoid.
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The ACFE is proud to announce that Lyn Cameron, Kenneth R. Dieffenback and Victoria Meyer have been elected to the 2020-2021 ACFE Board of Regents. Fellow CFEs elected them from candidates selected by the Board's nomination committee. The three new regents will take office at the Board's meeting in February at ACFE headquarters in Austin, Texas.
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Even though scams are widespread, there are many good people out there who are willing and able to help others avoid these scams. To help bring a spot of brightness to your day in these uncertain times, here are a few feel-good fraud-fighting tales where the bad guys don’t win. They are stories that inspire us to lend our expertise to others who might be at risk of a scam.
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Earlier this year, the President of the African Development Bank (AfDB), Akinwunmi Adesina was accused of “multiple abuses and breaches of the Bank’s code of ethics.” As reported by a French newspaper, among other things, Adesina was accused of “violation of the code of conduct” and “hindrance to efficiency (…) affecting confidence in the integrity” of the bank. The employees were reported to have made use of the bank’s Whistle Blowing and Complaints Handling Policy, which permits anonymous disclosures.
On January 19, they filed a complaint and forwarded an 11-page document to AfDB's Integrity and Anti-Corruption Department, detailing 16 cases of alleged abuse.
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Fraud is all around us, grabbing the headlines every single day. Fraud is a high-impact, low-probability risk with the potential to destroy a firm’s integrity and reputation very quickly. Many firms focus on the low-probability nature of fraud, and consequently fail to employ both resources and structure to address this risk. A typical fraud risk management framework includes the following components: governance, assessment, strategy and evaluation.
Let’s take a look at four steps a firm can take to develop and maintain an effective fraud risk management program.
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With the news of a global pandemic and looming recession, there have been different responses from both government and private organizations across the world. Not a lot of people foresaw such an event occurring nor did they have this in their yearly forecasts and budgets — that work would be restricted, stay-at-home orders would be enforced and nonessential services would take a back seat. Here are five tangible actions your organization can take to continue proactive fraud risk management during a crisis.
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Business disruptions occurring globally are causing significant shifts in how everyone, including fraud examiners, approach their jobs and duties. With many professionals working remotely for the first time, one of the most significant changes for fraud examiners might be the inability to conduct in-person interviews due to COVID-19.
One of the most impressive things about the ACFE membership is the wide range of roles, backgrounds and types of professional experience represented. Some members are not letting COVID-19 restrictions affect their tried-and-true processes, while for others, remote interviewing has been part of their repertoire well before a global pandemic impacted the profession.
We recently asked our members to share their perspectives on remote interviewing. Here’s what they had to say.
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Fraud risk management should both inform and shape any third-party risk management program in conjunction with all the other risk disciplines. Now more than ever, with increased regulation and risk, organizations must conduct vigorous, structured and regular due diligence on third-party intermediaries. The risks posed by these parties are many and varied, ranging from cybersecurity to business disaster. With third parties accessing regulated company information, the likelihood and impact of IT security incidents are on the rise.
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If 2020 has taught us anything so far, it’s that technology pervades nearly every sector of our lives. As COVID-19 began to impact daily life worldwide in early 2020, it seemed like everything that could be moved to a tech platform was moved. Terms like “Zoom-bombing” and “video call fatigue” entered our vocabulary. And we saw a massive increase in the number of frauds — cybercriminals and fraudsters were working from home, too. In this third part of four, we cover some of the resources to help make fraud examiners more tech savvy, and gain a deeper appreciation for the technical aspects of our job as fraud fighters.
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We as fraud examiners need to consider adding more technology knowledge to our fraud-fighting toolkit as we adapt to the pace of technological change and development. This post explores some free or low-cost training opportunities to help you build your capacity as a fraud examiner. It should be noted that the inclusion of any site is not an endorsement, but rather a suggestion for further review based on individual circumstances.
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As fraud examiners, we regularly encounter technology in our investigations. For 2020, consider adding more technology knowledge to your toolkit. There are new technologies introduced to the world on a daily basis, so even if you’re already tech savvy, consider other tech skills you could add.
Not as skilled as you want to be? That’s okay! Here are five resources you can use to help immerse yourself in the current issues, especially as they relate to fraud. This list isn’t exhaustive but meant to give you a simple, easy, free way to understand the issues today.
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Over the last year, I have been providing resources to discover and re-discover topics related to technology. This year has put tremendous emphasis on the use of technology and upping our tech game as fraud examiners. This is the fourth and final part of my tech-focused articles this year on ACFE Insights to help fraud examiners and investigators learn more and dive deeper into the world of tech. By bringing these resources to the community, it can help grow our knowledge base in this area, especially with the exponential growth in online fraud schemes and the increased need for technology-enabled investigations.
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For anyone who made a New Year’s resolution to pass the CFE Exam this year, now may be the perfect time for you to take the first necessary steps to earn the Certified Fraud Examiner credential. Sometimes the hardest part of achieving a goal is simply getting started.
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The spread of COVID-19 has transformed the everyday lives of millions of people. For the vast majority of us, we’ve found ourselves navigating the challenges that come with working from home and all the distractions that may involve, whether it’s bingeing too much TV, raiding the fridge or wrangling children. While it can feel nice to lounge in pajamas while working, the change in routine can also carry significant stressors. As a way to combat the trials of quarantine, we’d like to offer some anti-fraud-related activities that you can enjoy virtually with friends or family to enliven your days as we work to combat the spread of coronavirus and fraud.
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According to the ACFE’s 2020 Report to the Nations, organizations with less than 100 employees suffered larger median losses than those of larger companies. In other words, fraud can happen at any organization, no matter the size, so it’s important to understand the warning signs.
So, what are the warning signs to look out for?
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Monica Gutierrez-Altenhof joined the last 90-Day CFE Exam Challenge right after she had her first baby. Her goal was to return from maternity leave with her CFE. She is only one semester away from finishing her MBA, with the goal of continuing to progress in her career with TIAA. Here’s how the 90-Day CFE Exam Challenge helped her pass the exam and come back to work as a CFE.
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As we all know, COVID-19 was an unforeseen force that altered the lives of millions globally, but rather than be dismayed by the circumstances surrounding the coronavirus, Garnal Brown, CFE, sought the silver lining behind the proverbial dark clouds. One of the many changes that the pandemic gave rise to was an increase in remote work, and Garnal decided that joining the previous 90-Day CFE Exam Challenge would be a productive use of time amid the unpredictable state of affairs. Here, Garnal shares her CFE journey with anyone who may be considering joining our next 90-Day CFE Exam Challenge.
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Rocio Castellanos lives and works in Zurich, Switzerland. She is a senior finance professional with broad experience across a variety of industries. She started her career as an external auditor at PricewaterhouseCoopers (PwC) and moved later to the internal audit department of Syngenta International. During the most recent 90-Day CFE Exam Challenge, Rocio set her sights on passing the CFE Exam to get her CFE credential and advance her career. Here’s how the challenge helped her meet this goal.
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Tolulope Adedokun lives and works in Lagos, Nigeria. He has been in banking for 15 years. Tolu found that studying for the CFE Exam put names and concepts to various experiences he’s had in the course of his roles, specifically in risk management, of which fraud poses a key risk. This past April, he joined the 90-Day CFE Exam Challenge to earn his CFE credential. Here are some experiences and advice he’d like to share with other members who will be joining the upcoming challenge.
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The past few months have brought social and political unrest to the forefront of local, national and even global conversations. This is an unprecedented time of awareness, but as difficult and eye-opening as these moments of national rupture have been, they present a crucial time for organizations to assess workplaces and communities.
On August 19, the ACFE hosted a webinar titled, “A Conversation About Diversity, Equity and Inclusion in the Anti-Fraud Field,” which is free and available to view for all ACFE members.
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Our thoughts are with everyone who has been personally affected by the coronavirus during this uncertain time. But despite that uncertainty, our purpose remains the same — to provide you with high-quality, gold-standard service and education.
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Presently, Erik Halvorson is assigned as part of a nationwide team that uses analytics to identify and support investigations with top federal employees. During these past nine years of learning, Halvorson has come to rely on three steps that consistently pay off. The three steps are idea mapping, visualizations and statistical analyses. They are how he generally organizes his initial review when he’s beginning a potential project.
But he didn’t always follow these three steps. Here’s the story of how he came to rely on them for his fraud investigations.
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Happy International Women’s Day! This week, the ACFE is proud to recognize more than 35,000 female anti-fraud professionals in honor of International Women's Day. Throughout the week, we’ve shared blog posts, resources and exclusive profiles of the women who dedicate their time to fighting fraud. And today, Sunday, March 8, we have a special announcement to make.
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In Richard E. Nisbett’s book “The Geography of Thought: How Asians and Westerners Think Differently... and Why,” Nisbett describes a scenario where Western and Japanese students are asked to describe a painting of a koi pond. Western students focus on the largest fish while Japanese students describe the entirety of the painting, focusing less on one subject.
Of course, it’s a generalization, but what does it mean in the context of anti-fraud? In my experience working with Japanese organizations over the past decade, it means two very different approaches to the same problem.
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If there's one thing the ACFE and its members know, it's that the world never stops changing.
Technology evolves. Fraudsters adapt. New threats emerge.
All the while, you are there at the forefront, pushing yourselves to keep up with each dramatic twist and turn.
As we head into another year of preventing, detecting and deterring fraud, please take a moment to visit the 2019 Report to Members, where we’ve not only captured many of your accomplishments from the past year but also share a few things we can all look forward to in 2020.
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If you’re working remotely and want to surprise coworkers with a fun background, why not take a stroll through the Fraud Museum? Or perhaps you can be featured on the cover of Fraud Magazine? Another option is to go for something simple but bold, the ACFE Strong way. Whatever your preference, we’ve created five backgrounds for you to download and use in your next virtual get-together.
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Recently, Charles Washington, CFE, spoke on a panel for an ACFE webinar titled “A Conversation About Diversity, Equity and Inclusion in the Anti-Fraud Profession.” In this post, he digs in even further into this topic to share insights and advice on how you can make an impact in your own workplace and foster a culture of diversity, equity and inclusion as an anti-fraud professional.
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Monica Modi Dalwadi, CFE, CPA, is a managing partner in the D.C. area for Baker Tilly. She works primarily with owners and financial officers of companies, providing business consulting services. She also acts as a valued advisor to her clients as a partner and leader in risk, internal audit and cybersecurity.
Recently, Dalwadi spoke on a panel for an ACFE webinar titled “A Conversation About Diversity, Equity and Inclusion in the Anti-Fraud Profession.” And now, Dalwadi has generously shared even more tips, advice and insights into how anti-fraud professionals can work to create a similar environment in their workplace, their community and beyond.
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The 2020 Report to the Nations — the ACFE’s 11th study on the costs and effects of occupational fraud — represents the latest in a series of reports dating back to the first edition published in 1996. In the 24 years since it was first published, the Report to the Nations has arguably contributed more to our understanding of occupational fraud than any other source of information.
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One of the greatest challenges in our field is to think like the fraudsters we’re trying to stop. It’s not easy for CFEs to live inside crooks’ minds, but it’s important to put on those “glasses” and try to see our organizations from the fraudster’s mindset.
Bret Hood, CFE, in his Fraud Magazine cover article, “Twisted rationalization,” which examines this third leg of the Fraud Triangle, encourages fraud examiners to address this component more thoroughly in their fraud risk management programs.
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The ACFE Board of Regents sets standards to promote professionalism and ensure the reputation of the CFE credential. This year, six candidates have been selected to compete for two positions on the 2021-2022 Board of Regents. CFEs, be sure to place your vote before November 30!
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A few years ago, I worked a bogus inventory case. The organization in question had various branches across the country. The accounting books for all of these branches were centrally maintained at the organization’s headquarters. To organize their books by branch, they created a corresponding profit center in the accounting software. So for Branch X, organization created Profit Center X.
While finalizing the end-of-year accounts, an auditor identified that the organization had only five physical branches, but six profit centers existed in the accounting software. This didn’t seem right to the auditor, so he dug deeper, looking for the reason why there was a difference in the number of profit centers versus the actual branches.
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Traditionally, telehealth has been used to treat patients who cannot consult with a physician in an office setting. Such patients often live in rural areas that lack nearby physicians. Technological advances have led to new types of telehealth services, which are now used for public education, administrative functions and other purposes. Additionally, as the coronavirus pandemic demonstrates, the demand for telehealth services will continue to grow because these services can be more convenient and safe. These factors have caused rapid growth in the telehealth industry, as well as new types of fraud.
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In December, we wrapped up the latest 90-Day CFE Exam Challenge. Associate members joined the challenge and set a goal to prepare for and pass the CFE Exam within 90 days. Many of those who passed the exam also met the remaining qualifications needed to earn the CFE credential. Either way, passing the exam is a huge accomplishment, and we applaud all of the participants who put in hours of study time each week to meet this goal.
Congratulations to the 170 members who completed the challenge successfully and are now CFEs!
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At the end of June, we wrapped up the latest 90-Day CFE Exam Challenge. Associate members joined the challenge and set a goal to prepare for and pass the CFE Exam within 90 days. Congratulations to the 152 members who completed the challenge successfully and are now CFEs!
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The COVID-19 pandemic is unprecedented in many ways for our lifetime. We are seeing its impact on individual lives, governments and the global economy. While cities and countries are scrambling to contain the virus and protect their citizens, they are also watching global markets decline at a breakneck speed. As the president and CEO of the Association of Certified Fraud Examiners (ACFE), the world's largest anti-fraud organization, I unfortunately can tell you that the looming economic downturn we can expect to see has a number of long-lasting implications. One important one being an explosion of fraud in the coming years — and organizations need to brace themselves.
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The U.K.’s National Health Service (NHS) is not perfect, but it enjoys global envy as “free health care” for the masses (paid for by U.K. taxpayers). However, the NHS can be a soft target for COVID-19 fraudsters.
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Early in my career, I was exposed to various potential conflict-of-interest situations and was tasked with raising awareness and providing training to employees. I realized hypothetical conflict-of-interest scenarios, when presented to employees, assist in the thinking process and elicit new ideas. Each time we discussed the hypothetical scenario, it brought about a new dimension. Here’s a hypothetical conflict of interest, deconstructed to different levels of thinking.
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Your donation to the ACFE Foundation could change the course of a student’s career. In the 2015-2016 school year, Jonathan Peck, CFE, CPA, was one of the Ritchie-Jennings Memorial Scholarship recipients. After receiving the scholarship, he went on to become a forensic accountant intern with the FBI. Currently, he works at Google.
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Employees may frequently wish to engage in activities within their normal scope of work due to passion, interest, social responsibility or financial gain. It’s your organization’s responsibility to educate and train employees so that they are aware of any potential conflicts of interest in relation to external activities. This will allow both the employee and the organization to avoid compromising situations.
This general approach can provide a guiding pathway to employees who otherwise might be nervous to raise a potential conflict-of-interest situation.
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The use of mobile banking apps has increased dramatically during the COVID-19 pandemic. A recent CNBC article claims that in early April there was an 85% increase in mobile banking traffic and new mobile banking registrations jumped 200%. According to the FBI, mobile banking has surged 50% since the beginning of 2020. These numbers illustrate that stay-at-home orders, temporary business closures and COVID-19 fears have accelerated the use of mobile banking among a large portion of the population. As fraud examiners know, new technologies create new opportunities for fraud. Here’s what you should look out for.
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The Federal Trade Commission (FTC) is a U.S. federal agency charged with protecting consumers from unfair, deceptive and fraudulent practices in the marketplace, and ensuring competition by enforcing antitrust laws. In addition, the FTC also collects consumer complaints around data security, deceptive advertising and Do Not Call Violations, which are then made available to law enforcement agencies around the world.
On January 23, 2020, the FTC announced access to data showing insights into their refund program.
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Amazon has long been a target for retailer schemes and various types of consumer fraud. Four New York-based brothers recently took this to the next level and, on August 19, started facing the consequences. The Abraham brothers — Yoel, 28; Heshl, 32; Zishe, 30; and Shmuel, 24 — were arrested and charged with wire fraud, conspiracy to commit wire fraud and money laundering after law enforcement busted an alleged fraud ring that they were running out of their parents’ home in Monsey, NY.
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In the latest episode of Fraud Talk, Mason Wilder, CFE, ACFE senior research specialist, and Brian Fox, vice president of strategic partnerships at Thomson Reuters and president & founder of Confirmation, discuss the rise and fall of the German payments group, Wirecard. In this excerpt, Wilder and Fox discuss the impact of financial statement fraud and how some of the recent schemes like Wirecard affect more than just the bottom line.
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In this episode of Fraud Talk, ACFE Training Director Jason Zirkle, CFE, discuss the most common fraud schemes that arise during a natural disaster and, more specifically, which scams have emerged as a result of the COVID-19 pandemic.
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While the celebrity college admissions scandal made headlines, there are many other types of fraud that affect colleges and universities. In this episode of Fraud Talk, ACFE Research Specialist Julia Johnson, CFE, explains different fraud schemes in higher education and how to prevent them from occurring.
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Earlier this year, the ACFE hosted a webinar titled, “A Conversation About Diversity, Equity and Inclusion in the Anti-Fraud Field,” which is free and available to view for all ACFE members. In this month’s episode of Fraud Talk, you’ll hear an excerpt where the four panelists share who should be involved in this discussion and why. They also share how anti-fraud professionals can make belonging an integral part of workplace culture.
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Lyn Cameron, CFE, LL.B, is the senior director leading Microsoft’s Financial Integrity Unit, and recently, she was elected to the ACFE's Board of Regents. In the most recent episode of Fraud Talk, the ACFE’s monthly podcast, Cameron shares advice on what it takes to build a fulfilling career, oversee case management for complex fraud investigations and manage a team that's spread out all over the world.
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January’s podcast is December’s Facebook Live recording during which ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, and Fraud Magazine Associate Editor Emily Primeaux, CFE, unveiled the most scandalous fraud schemes of 2019. Each story that was selected went through a rigorous vetting process, both internally and with the ACFE’s Advisory Council.
Here is an excerpt from the full transcript of the discussion, which you can download in PDF form or listen to at the bottom of this post.
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In the most recent episode of Fraud Talk, the ACFE’s monthly podcast, Arpinder Singh, CFE, partner and head of India and emerging markets, Forensic & Integrity Services at EY, highlights how cybercrimes like business email compromise (BEC) scams, phishing and account takeover have risen and will continue to rise over the next year.
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In the latest episode of Fraud Talk, the ACFE’s monthly podcast, Dr. Lisa Walker, leadership psychologist and executive coach, shares the value of practicing emotional intelligence to grow professionally, manage teams and move ahead. Also, in honor of International Women's Day on March 8, she discusses tips for women in the anti-fraud profession who are building and leading teams. Additionally, stay tuned until the very end for a special announcement from the ACFE.
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Questions. We all have so many questions right now. When will this be over? How can I keep moving when it feels like the world is telling me to stand still? What does the future hold? While I can’t answer any of these questions for you, I can answer a question we have been getting here at the ACFE: what are some easy ways for me to get my CPE while social distancing?
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If you were involved in promoting a multibillion dollar, international, cryptocurrency-based, multilevel marketing Ponzi scheme, what would you do for an encore? If you guessed “rinse and repeat,” you’d be accurately describing the decision-making of one Le Quoc-Hung, also known as Simon Le.
As the infamous OneCoin scheme’s aftermath left the sibling founders of the “cryptocurrency” facing a $4 billion class-action suit from its victims, Le pivoted from still promoting a multilevel marketing company already exposed as a scam, to launching a new version of the scheme under a new name: OneLink.
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We’ve all been there in a fraud examination. You’re looking at financial statements, invoice amounts or expense reimbursements that appear normal, but you know in your gut that something is wrong. The numbers just don’t feel right, but it’s not obvious. Like Alice going down a rabbit hole, you’re becoming “curiouser and curiouser” about what you’re inspecting.
In the latest issue of Fraud Magazine, Mark Nigrini, Ph.D., a leading Benford’s Law expert, writes the excellent, detailed cover article on six typical number patterns (including Benford’s) that you can search for during your cases to possibly find fraud.
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As I listened to the stories of former U.S. Drug Enforcement Administration agents, Javier Peña and Steve Murphy — the inspirations behind the Netflix series “Narcos” — during the 31st Annual ACFE Global Fraud Conference in June, I sensed their passion for catching Pablo Escobar and other drug traffickers. Despite enduring constant danger and peril, they seized the mission to disrupt the narcotics trade in Colombia.
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Building a long-lasting, meaningful career takes effort, determination and perseverance. There are bumps and challenges, and often, many unexpected twists and turns. It never hurts to ask for a little help along the way. Here’s some excellent career advice from fellow fraud fighters.
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With global economies trying to rebound after the effect of COVID-19, employers and companies have adjusted to the current situation. For many organizations, with cautious optimism in reopening, the recruitment process has shifted completely online. Terms such as “work from home” and “remote” are springing up in the job market. Though the virtual workplace is not new, the effect of the global pandemic, particularly with health and public safety guidelines, has cut out a considerable opportunity for in-person meetings.
In the past, the pre-interview and interview stages could be conducted virtually while the onboarding stage was in person at the office, but now, most of the recruitment processes — from sourcing candidates to onboarding and exit stages — is now online. This has created an opportunity for fraudsters to explore.
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When we learn a new skill, there is typically a lag between what we learn contextually (i.e. from school) and how we can apply that knowledge to a real-world situation. Data analytics is no different. There is no clearer example of this than the use of analytics in an investigation, especially in a proactive fraud analysis. In that spirit, let’s dig in to the process of idea mapping. Hopefully this will help your plan come together, or identify weaknesses in the plan early so they can be caught and fixed.
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In Mindy Mejia’s latest novel, “Strike Me Down,” the main character, Nora Trier, is a forensic accountant who is single-minded in her pursuit of fraudsters. Nora’s story begins when her firm is hired by a popular kickboxing gym to find $20 million of tournament prize money that has gone missing. Nora and her firm are tasked with finding the money before the tournament ends in less than a week.
After you read our interview with Mindy Mejia, make sure you enter the “Strike Me Down” book giveaway.
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When New York Times reporter Kashmir Hill began her investigation into Clearview AI, the company was shrouded in mystery. After months of digging, Hill has uncovered a fair amount of information about the facial recognition app, but many questions remain unanswered, leaving the future of privacy as enigmatic as ever.
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Attention ACFE members, you’re invited to join the Mentoring Program!
The ACFE Mentoring Program connects ACFE members to anti-fraud professionals from all over the world who can offer a wealth of resources, experience, advice and guidance. Here are some basics about the program and how it works.
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This week the ACFE launched a new group in the online community called “Women in the Anti-Fraud Profession.” The group is open to all ACFE members, regardless of gender and no matter how related (or not) your current role is to fraud. We are excited to offer this group in the community as a place to discuss common challenges, ask questions, share ideas and resources, and support each other as we navigate our own professional journeys. We’ll cover topics like confidence vs. competence, how to be noticed by leadership, naming and sharing your goals, getting started in your anti-fraud career and so much more.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by the end of this year.
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Jules Kroll didn’t start out to create one of the largest investigative firms in the world. However, he did recognize the need for such a service for corporations and governments after he battled corruption against his father’s printing business. Kroll will receive the Cressey Award at the 31st Annual ACFE Global Fraud Conference June 21-26 in Boston for his decades of work in uncovering fraud.
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Alan I. Blass, CFE, CPA, has led an impressive career over more than four decades in the anti-fraud industry in both the public and private sectors. He currently has his own practice that specializes in forensic accounting and litigation support services in New York and South Florida. He has also served as the president of three different ACFE chapters.
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Crystal Skotedis, CFE, CPA, is more than just a fraud examiner with over a decade of experience in auditing — she is a pillar of her community. She is president of the ACFE Central Pennsylvania Chapter and was appointed to be treasurer for Capital Region Water, a volunteer position serving her community. She also has been named in Pennsylvania Business Central’s Women Making a Difference List, as well as the Central Penn Business Journal as a Women of Influence Award winner.
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Donal O’Hagan, CFE, recently earned his credential after years of observing and investigating fraud in the parking industry. As the founder of Parking Business Services, he advises organizations on how to set up and run parking operations with a focus on fraud prevention built in to their business from the start.
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In the 2015-2016 school year, Jonathan Peck, CFE, CPA, was one of the Ritchie-Jennings Memorial Scholarship recipients. After receiving the scholarship, Peck went on to become a forensic accountant intern with the FBI. He also used the scholarship to help fund earning a master's degree in accounting at the University of Michigan. Currently, he works at Google. Jon has had many roles over the past few years, including working on Google’s internal forensic accounting team. Here’s more about how the scholarship helped shape his career as an anti-fraud professional.
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Michael Wynn, CFE, has more than 30 years of combined experience in accounting, auditing, fraud examination and grant monitoring. He recently retired from working for the state of Michigan and now devotes his time to consulting on risk assessments, compliance and operational reviews. He also teaches organizations and individuals about financial literacy and is a motivational speaker and professional development coach.
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Nassor Matherson, CFE, is fairly new to the anti-fraud industry, but his enthusiasm for preventing and detecting fraud shows that he has a long, illustrious career ahead of him. He currently works as a tax auditor for the New York City Department of Finance (NYC DoF) and obtained his CFE credential at the end of 2019. He credits his mentor in the ACFE Brooklyn Chapter for inspiring his love of fraud examination.
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Robert Perez, CFE, first became interested in the anti-fraud industry when he worked in Houston next to Enron. After seeing the fallout for not only Enron employees, but employees of Arthur Andersen and members of the community, he saw the impact fraud could have on hundreds of people. When he moved back to his home state of Louisiana, he became an indirect tax auditor for St. Charles Parish, where he currently works examining the records of large chemical plants and a variety of smaller businesses.
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Until four years ago, most of his experience had been working as road patrol, but Sergeant Yoshua Garfinkel, CFE, has always been drawn to investigating fraud. Now the Sergeant of the Hialeah Police Department Economic Crimes Unit, the department’s first CFE and the vice president of the ACFE South Florida Chapter, he credits his rise through the ranks to his desire to keep learning and share that knowledge. “I pride myself on the level of success I was able to achieve, as well as my ability to assist others,” he said. “I attribute this to my pursuit of continuing education.”
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Sheechean Ho, CFE, has enjoyed a successful career in the anti-fraud field for more than a decade. Currently the director of investigations for regional financial crime at Prudential plc, he attributes his success to his desire for justice and mentors who have guided him. When he’s not fighting fraud, you can find him taking scenic drives around Hong Kong and sampling different local food.
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Sophia H. Pretrick, CFE, is the investigative advisor in the Compliance Investigation Division of the Office of the Pohnpei State Public Auditor in the Federated States of Micronesia (FSM). She has worked in the anti-fraud profession for nearly 20 years and has seen firsthand how fraud can directly affect the well-being of citizens in the small island states of FSM. She hopes to continue to spread anti-fraud knowledge within her community and join forces with other anti-fraud professionals in the Micronesian region.
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Hugh Penri-Williams enrolled as a mentor when the ACFE first launched the mentoring program in May 2018. In the past two years, he’s worked with several mentees to help them achieve their career goals. One of those mentees is Catherine. Because of Catherine’s strong desire to detect and deter fraud, she studied for the CFE Exam in order to earn her CFE credential. She decided to join the ACFE Mentoring Program to help her meet this goal.
That’s where Hugh and Catherine’s mentoring story begins.
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The Racketeer Influenced and Corrupt Organizations (RICO) Act was passed by Congress and signed into law by President Nixon 50 years ago, in 1970. Originally, the act was designed to combat organized crime, but the law’s application has expanded to include any group profiting from illegal activity. Probate fraud cases, in particular, can be harrowing because fraudsters take advantage of people in vulnerable emotional states. In these three cases, you will see how bad actors can manipulate the legal system to perpetuate their fraud schemes.
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International Fraud Awareness Week is here! This is the 20th anniversary of Fraud Week and we have more than 1,000 supporters from around the world — making this the largest fraud week ever.
Fraud Week was founded in 2000 to establish a designated time when anti-fraud professionals can share their knowledge with their colleagues, friends and larger community. And due to the ongoing, worldwide COVID-19 pandemic, spreading fraud awareness has never been more important.
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In early April, China-based Luckin Coffee shocked investors and consumers worldwide when its board revealed in an SEC filing that it has initiated an internal investigation into the activities of its former Chief Operating Officer (COO), which are linked to an alleged $300 million fraud.
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It has come to our attention that there may be accounts on various social media platforms impersonating Bruce Dorris, president and CEO of the ACFE, with the aim of defrauding individuals. To help ensure everyone’s safety, here are the official accounts of Bruce Dorris, J.D., CFE, CPA.
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“That could never happen here! Why would someone ever steal from our company? The internal audit people will catch it if someone tries anything. My co-workers are like family! I just can’t imagine someone doing that!”
Does this sound familiar? As anti-fraud professionals, we are trained to find and fix the opportunities for fraudulent activity within our organizations. But there are usually only a few of us and many employees. How is a small team, or single fraud professional, supposed to deter and detect all fraud?
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The motto for the virtual 31st Annual ACFE Global Fraud Conference June 21-26 is “Light the Way.” Howard Wilkinson had to keep increasing the size and intensity of his light to near-blinding brightness to prod Danske Bank and its regulators to investigate the frauds that were occurring under their noses. The latest issue of Fraud Magazine’s cover story on Wilkinson illustrates just how difficult it can be for whistleblowers to get people to see frauds happening right in front of them.
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Throughout the COVID-19 pandemic, fraudsters have developed a broad range of insidious schemes to prey on a variety of industries and subjects. A recent spate of attacks have targeted third-party payment and money transfer phone apps, such as Venmo, Cash App, and Zelle. These apps have soared in popularity as people have been making payments from their phones instead of going to banks or handling cash.
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Showtime’s recent four-part documentary series “Love Fraud” covers a familiar premise: a conman meets a slew of women on dating apps, woos them, convinces them to marry him and then wipes them of their savings and disappears. But directors Heidi Ewing and Rachel Grady have given this particular narrative a twist — instead of focusing on the conman himself, their documentary follows in real time as the victimized women band together to seek revenge.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by March 31, 2021. The challenge arms you with study tips and peer support to help you stay motivated and on track to reach your professional goals.
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On November 27, 2019, the South Korean cryptocurrency exchange Upbit released a statement confirming they had been subject to a malicious hack that transferred 342,000 ethereum (ETH) — around $50 million — from Upbit’s Ethereum hot wallet to an anonymous wallet. Since the transfer, the stolen Ethereum has evaded tracking by Upbit and the cryptocurrency community, calling into question the security protocols used by major exchange platforms.
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Thanks to the newly published 2020 Compensation Guide for Anti-Fraud Professionals, you can now point to comparative analysis and data to prove your value. In addition to other key findings, the latest report found that CFEs earn 34% more than non-CFEs, and earning your CFE early in your career can have a dramatic impact on the total amount you earn during your professional life.
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International Fraud Awareness Week 2020 is coming to a close now, and we at the ACFE want to thank everyone who signed up as an official supporter. It’s the 20th anniversary of Fraud Week and we had a record amount of organizations sign up to be official supporters this year.
Even though most people weren’t able to hold in-person events, there were so many creative virtual events put on by supporters this year. ACFE local chapters especially stepped up and organized a multitude of virtual trainings, webinars and activities.
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Anti-fraud training needs to engage. Not just because fraud costs trillions, but because employees get a lot of training. According to Training Magazine's 2018 Training Industry Report, the average employee in the United States gets 46.7 hours of training each year. If you’re running anti-fraud training, you have a lot of competition for peoples’ time, attention and memory. Follow these five Cs of anti-fraud training success to maximize that time!
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We know that scammers take advantage of crises, exploiting people at their most vulnerable moments to propagate fraud attacks. International emergencies add a fear factor that aids criminals in information theft. Here’s how fraud risk management can help to prevent fraudsters from using the current environment to their own malicious advantage.
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Daphne Caruana Galizia had the same dogged pursuit of fraudsters and the desire to bring them to justice that you do. She was an investigative journalist in Malta who was unwavering in her pursuit of allegations of corruption by government officials and businesspeople in her country. Tragically, she lost her life because of that pursuit. Her son, Matthew, will accept, on her behalf, the posthumous 2020 ACFE Guardian Award.
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“Bad Education,” one of HBO’s newest streaming releases, is a sobering reminder that crime doesn’t pay. The film is a dramatization of the largest school system embezzlement scandal in U.S. history, and it follows three key players: Dr. Frank Tassone (Hugh Jackman), the Roslyn school district superintendent; Pamela Gluckin (Allison Janney), the assistant superintendent and business administrator; and Rachel Bhargava (Geraldine Viswanathan), the intrepid student reporter who broke the story to the world.
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Last month, we launched the Fraud in the Wake of COVID-19 Benchmarking Report, September 2020 Edition. This is the second edition of this benchmarking study, which updates the first edition we launched back in June.
The report is free and available to print or download. Here are some key findings that can help you understand what you and your organization are currently facing.
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When deciding on a business name, it is best to choose one that is unique, grabs attention and conveys meaning. The following fraudsters did not take that advice to heart when they named the businesses they owned. They each chose business names that allude to riches, steady cash flow and smart money management. In reality, the fraudsters used these companies to orchestrate a variety of fraud schemes. While these company names might sound enticing, before investing in anything, it’s always wise to dig beneath the surface to make sure you understand the true intent and nature of an entity’s operational purposes.
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This month, we launched the Fraud in the Wake of COVID-19 Benchmarking Report, December 2020 Edition. This is the third edition of this benchmarking study, which updates the two previous editions we launched in June and September.
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Throughout 2020, we published 104 posts on ACFE Insights and 25 guest authors contributed their expertise. As you can see from the list of our top 10 posts below, ACFE Insights has been here to help anti-fraud professionals navigate the new and unexpected terrain of COVID-19 while also covering foundational anti-fraud knowledge. If you missed anything from the top 10 blog posts of 2020, it’s time to kick your feet up and read these popular posts.
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Proactive anti-fraud controls play a key role in an organization’s fight against fraud. While the presence of these mechanisms alone does not ensure that all fraud will be prevented, management’s commitment to and investment in targeted prevention and detection measures send a clear message to employees, vendors, customers and others about the organization’s anti-fraud stance. The ACFE’s 2020 Report to the Nations not only identifies the top anti-fraud controls that can help protect organizations, but also illustrates what can happen when controls are weak or altogether missing.
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Since 2011, Tunisia has been engaged in a relentless fight against fraud and corruption. An institutional and legal arsenal has been put in place to carry out this endless fight. The new constitution of 2014 has established an independent commission: The Good Governance and Anti-Corruption Commission, whose main prerogative is to contribute to policies of good governance, as well as preventing and fighting corruption.
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Members often ask for advice on how to break into the anti-fraud field, so in honor of International Women’s Day, we asked a few of our members, “What was your first job as an anti-fraud professional and what did you learn from it?” Here’s what these fraud fighters had to say.
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The news of data breaches and online frauds has become a matter of regular occurrence, which serves as a constant reminder that organizations need a robust strategy for fraud prevention and cybersecurity. Though the private sector usually grabs the headlines, the public sector often faces similar incidents. The public sector can include many different areas of service — healthcare, education, parks, libraries and more. Likewise, the judicial system, law enforcement and other government entities are vital components of the public sector. Because of their critical role, these departments and organizations have now become key targets for cybercriminals.
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I do not agree with the concept of open (or public) company registers. This is not for any ideological reason. Rather, they are a flawed tool in combating corruption and recovering assets from money launderers and fraudsters.
But if we are to have them, and if they are heading our way, then we should consider making them accessible via the payment of a realistic fee. This will help bolster their robustness and the verification process. At present, that’s often woefully lacking in some of the world’s best-known register systems.
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The ACFE invites you to sign up for the upcoming 90-Day CFE Exam Challenge to earn your Certified Fraud Examiner (CFE) credential by June 30, 2020. The challenge provides you with study tips and peer support to help you stay motivated and on track to reach your goal of passing the CFE Exam. Our upcoming challenge begins on April 1 and ends on June 30.
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While dealing with a crisis, like the current coronavirus pandemic, organizations may deploy an unusually large part of their resources and time for managing the incident and its impact. By doing so, organizations may suspend or limit some controls over critical processes. Fraudsters, whether internal or external, are waiting for this opportunity. Here are three major factors that make an organization vulnerable to fraud during a crisis.
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Since 2013, when the FBI began tracking business email compromise as an emerging financial cyber threat, organized crime groups have targeted large and small organizations in every U.S. state and more than 100 countries around the world — from nonprofits and well-known corporations to churches and school systems. Losses are in the billions of dollars and climbing. It is noteworthy that BEC is now one of the most common and prolific fraud schemes. With that chilling thought in mind, here are 12 quick ways you can protect your company from a business email compromise scam.
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The ACFE is proud to announce that Eric R. Feldman, CFE, CIG, CCEP-I, and Bethmara Kessler, CFE, CISA, have been elected to the 2019-2020 ACFE Board of Regents. Fellow CFEs elected them from candidates selected by the Board's nomination committee. Feldman and Kessler will take office at the Board's meeting in February at ACFE headquarters in Austin, Texas.
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Conducting an effective interview is a key activity during a fraud examination, and an interview is simply a conversation with a specific purpose. A common thread to all interviews is the need to build rapport with the interviewee. There are three specific areas I focus on to build real rapport with an interview subject, foster open communication and achieve my interview goals. These three areas of focus are trust, respect and empathy.
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A few months ago, new global regulations were recommended by the Financial Action Task Force (FATF) to help prevent and deter terrorists and criminals from using cryptocurrencies. However, it will take some time before countries adopt these regulations and have proper prevention and compliance programs in place. In the meantime, numerous firms that specialize in blockchain analytics have created software with the focus of preventing, detecting and investigating cryptocurrencies used for terror financing, money laundering, fraud and compliance violations. Here are three firms who should be on your radar because of the fascinating and groundbreaking work they are doing in the world of blockchain analytics.
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Recently, we co-hosted #fraudconfchat (a Twitter chat) with Forensic Strategic Solutions in support of the 30th Annual ACFE Global Fraud Conference. While the conference has ended and you can read a lot of coverage from the big event, the Twitter chat participants shared so much great advice and wisdom that we wanted to put it all in one place.
Those who joined took the opportunity to discuss how the anti-fraud profession has evolved over the past 30 years and how fraud fighters have stepped up during that time. As usual, everyone came with their best gifs.
If you didn’t get a chance to join the Twitter chat, here are some of the top insights that were shared.
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For a number of years, I wrote or edited a column in Fraud Magazine called "Starting Out." It was for young professionals, new CFEs and college students. If you search the Fraud Magazine website's online archive for "starting out," you should come across several useful columns. I strongly urge you to read my column about the "Four Career Questions" (July/August 2015) you should ask yourself.
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Like some spurned exes, romance fraud simply won’t go away. If your online crush exhibits one or more of the following red flags of an online romance scam, you should probably ghost ’em.
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With the holidays approaching, it’s important to stay vigilant about possible electronic hacking, especially while traveling. Having to deal with compromised credit cards or identity theft is the last thing anyone wants to wrestle with during this festive and busy time. Here are four ways to keep your devices secure and free from harm this holiday season.
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Southeast Asia is an increasingly appealing market for organizations seeking to access the human capital and natural resources in the region, or capture the attention of the ever-growing middle class, which is currently estimated at 135 million people of the Association of Southeast Asian Nations’ (ASEAN) population of circa 665 million. It is also a complex and diverse region with considerable fraud challenges, Singapore excluded, which makes generalizations tricky. Here are five anti-fraud lessons from Southeast Asia.
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We’ve all found ourselves in an awkward situation from time to time. As uncomfortable as they are, it can sometimes be hard to avoid them.
You’re at the grocery store when someone unexpectedly waves at you so you wave back, only to realize they were waving at the person behind you.
You nod off at your desk right when your boss walks by.
It’s the end of the date and you say bye, but then you both start walking in the same direction.
Yikes.
Those are all pretty cringe-worthy moments, but they don’t compare to these five awkward situations that ultimately led to the discovery of a fraud scheme. Unfortunately for these fraudsters, they couldn’t just walk away and pretend it didn’t happen.
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While the internet serves as a large platform for a considerable number of scams, fraudsters have always been able to find creative outlets for their schemes, long before the advent of modern technology. The names Charles Ponzi and Victor Lustig may be well known among audiences tuned in to the history of con men, but here are stories of lesser known swindlers, going as far back as the fourth century B.C.
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In order to protect yourself and your company from a business email compromise (BEC) attack, you should stay up to date on different tactics and techniques used by fraudsters. Here are a few key pieces of information included in a recent Better Business Bureau report that you should know about BEC scams.
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Models are all around us — integral and important to operational efficiency — but the risks that they sometimes pose can materially impact the financial well-being of even the most well-structured organizations. In order to understand the risks, we must first define what a model is and what the inherent risks are when operating a model.
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Amelia Tercero has been one of the most active and engaged members of the ACFE Community. Since joining the ACFE in June 2018, she has posted more than 300 times. Tercero is always eager to share knowledge and experiences with fellow members to learn as much as possible about the anti-fraud profession. It was no surprise when she signed up for the 90-Day CFE Exam Challenge in October 2018, and she brought her lively personality to the challenge group.
Tercero has a background in financial services, mostly in banking, but no matter what her role was, she couldn't keep from identifying, deterring and preventing fraud. She knew that joining the 90-Day CFE Exam Challenge would put her on the fast track to pursuing her professional passion of fighting fraud.
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Brenda Auner, CFE, has been in government auditing for 10 years. Earlier this year, Brenda participated in the 90-Day CFE Exam Challenge. She’d been studying off and on for a while and had even participated in a previous challenge. But this time, she got really involved — posting regularly and using the challenge framework to keep herself on track. By doing this, she was able to stay dedicated to her goal and passed the CFE Exam in May 2019. Here’s some helpful advice and tips from Brenda for those who will join the upcoming 90-Day CFE Exam Challenge.
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Doug Dodge, CFE, served 10 years in the U.S. Army and has been in law enforcement for more than two decades. In April of this year, Doug signed up to join the 90-Day CFE Exam Challenge. He’d dabbled in fraud investigations through his work as a police officer but wanted to pass the CFE Exam and earn his CFE credential so that he could transfer more fully to this line of work. He was one of the most engaged members of the group, posting 44 times throughout the challenge and rarely missing the opportunity to cheer his fellow challenge participants on along the way. If you’re considering joining our upcoming challenge, here’s some advice from Doug on how to make the most of it.
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Nora Koci is an internal auditor for Ryan Specialty Group, which is based in Chicago, Illinois. She’s in her final semester of pursuing a Masters in Forensic Accounting at Roosevelt University. Her B.A. is in audio arts and acoustics from Columbia College, and she used to work as a stagehand. Moving into audit was a big career change for Koci, and her ultimate goal is to one day be a Special Agent with the FBI.
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The way students are learning has significantly changed since I attended college classes 30 years ago. I remember my accounting instructor standing in front of the 300-seat lecture hall with an overhead projector. When I first started teaching, I thought I was being “progressive” using PowerPoint slides! Today’s students are demanding more hands-on experience. They don’t want to just sit there and be “talked at.” They want more of the “tell me, show me, let me do it” type classroom. One of the most successful components of my class is the community project my students undertake each semester. Here’s how it works.
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A new type of scam preys on parents’ protective nature toward their children in order to coax them into wiring high ransoms. To do this, scammers make a phone call claiming they’ve taken a victim’s child, and they threaten to harm the child unless parents pay ransoms ranging from $5,000 to $6,000. In each reported case so far, there was actually no abduction. The child was discovered to be safe, often just at school or out with friends, but usually only after the parent had already paid the ransom.
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The recent news of wealthy business executives and celebrities paying large sums to gain access to prominent colleges and universities for their children’s education has outraged us all. Unfortunately, academic fraud of this type, and others used to gain admittance or enhance standing, is nothing new. In 2008, Cavya Chandra was denied admission to her dream school, Cornell University. She then falsified letters of recommendation to gain entry to Carnegie Mellon, but later transferred into Cornell University using fraudulent transcripts and falsified letters of recommendation.
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Michelle Holt sent shock waves through a Virginia courtroom in December when, immediately after pleading guilty to scamming the federal government out of $1.4 million, she walked over and hugged the federal prosecutor who had just filed computer fraud and theft of government property charges against her. In a sensational case that has left many people stunned, Holt was found to have bolstered her paychecks with false overtime, holiday and sick pay over a period of 17 years while working for the United States Air Force.
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A few months ago, my good friend — we’ll call her Betsy — wanted to sell her old computer to help pay for a new one. She’d sold plenty of items online before, so she listed it in a few different popular spots like Craigslist and Facebook Marketplace and waited for the offers to roll in.
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After years of working with these issues on a global scale, we are happy to see Australia becoming the next in an increasingly longer line of jurisdictions moving to enhance the protection of whistleblowers. The Australian Senate recently adopted the Treasury Laws Amendment (Enhancing Whistleblower Protections) Bill 2017. According to the Explanatory Memorandum, the new laws will affect approximately 33,000 companies in Australia. Costs of non-compliance can be high, including criminal prosecution and million-dollar fines.
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An ideal time to talk about fraud prevention within your organisation is during International Fraud Awareness Week (Fraud Week), November 17-23, 2019. First established by the ACFE in 2000, Fraud Week garnered the support of more than 500 organisations from 73 countries in 2018 and continues to grow each year. During the week, supporters host educational talks in their companies, spread consumer fraud tips within their communities and even hold interdepartmental expos. For this year’s Fraud Week, take a look at the current fraud prevention plan you have in place and evaluate its effectiveness.
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A federal judge asked Donald Watkins, Sr. to step away from the jury box as Watkins, Sr. made an impassioned plea in his closing argument. Watkins, Sr. was in the personal space of front-row jurors, who were clearly agitated and restless as they leaned, twisted back and forth and from side to side to move away from the attorney. Watkins, Sr. was pointing his finger at the jurors and leaning directly into them.
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In 1905, during the height of the Russo-Japanese War, Moscow sent a 5,800-ton warship, the Dmitrii Donskoi, to battle it out in the waters between Japan and what is now South Korea. During this skirmish, dubbed the Battle of Tsushima, the Dmitrii Donskoi sank, leaving no trace beyond rumors that immediately circulated claiming that the vessel had been carrying a vast number of gold coins. Reports from the time of the cruiser’s sinking suggest that the ship contained as many as 14,000 metric tons of these coins to fund Russia’s war effort. If correct, this sum would now be worth approximately $125 billion, an amount that has kept treasure hunters enthralled since the ship’s sinking.
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Recently, a former student (and a newly minted CFE) asked about what types of keywords they should be searching in job postings to help them attain their ultimate goal to be a fraud examiner. That led me to think about that question and what it means to search for a position.
In previous Fraud Magazine columns, I've written about how to define your areas of interest, limitations and ultimate career plans. These questions — and a thoughtful reflection period — can help you immensely in your career search.
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Airbnb currently has around 50,000 listings within New York City, making the tourism capital its largest market in the U.S. As Airbnb has experienced a steady climb in short-term rentals within NYC, the municipal and state governments have grown more keen on curbing Airbnb’s permissions for local rentals to keep more living spaces available for New York City residents, who already face a tight rental market. According to the New York State Multiple Dwelling Law, buildings with three or more units cannot offer rentals for fewer than 30 days at a time unless the owner or tenant of the unit is present while the guest is renting.
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This month, we finished up the latest 90-Day CFE Exam Challenge. Associate members joined the challenge and set a goal to prepare for and earn the CFE credential in 90 days. This is huge accomplishment, and we applaud all of the participants who put in hours of study time each week to meet this goal.
Congratulations to the 106 members who completed the challenge successfully and are now CFEs!
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In December, we finished up the latest 90-Day CFE Exam Challenge. Associate members joined the challenge and set a goal to prepare for and earn the CFE credential in 90 days. This is no small feat, and many participants put in hours of study time each week to meet this goal.
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In the summer of 2017, researchers from the University of Washington presented technology they developed that combined realistic lip-synched video of former U.S. President Barack Obama with preexisting video and audio clips. In doing so, they birthed deep fakes, a phenomenon which has gone on to cause consternation among national security figures and, generally, creep a lot of people out.
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Red Rover is a popular children’s game in many English-speaking countries. Kids clasp hands, standing side-by-side to form two lines, each facing the other. One team taunts their rivals, “Red Rover, Red Rover send Chris right over!” Chris rushes the opposing line, trying to break the human chain. Imagine your bank as one team and fraudsters as the opposition. Would the bank hold strong? Or would the fraudster burst through?
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The Identity Theft Resource Center (ITRC) has been analyzing data breaches since 2005 to better understand the importance of cybersecurity and to assist victims of these incidents. Consumers and companies are suffering from these breaches in the business, travel, financial, healthcare and more industries. In their most recent report analyzing the data from 2018, they evaluated more than 1,200 data breaches that were publicly disclosed. Last year large corporations, government agencies and online businesses all fell victim to data breaches. These breaches exposed more than 446 million records of consumer personal identifying information (PII). With companies and consumers suffering from the impact of these incidents, it’s time to focus on what professionals in the industry can do to help.
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As part of a recent fraud examination, you’re conducting research on your computer via several search engines. But even if you diligently study hundreds of sources, you’ll only see a fraction of online information. You must explore the dark web — the series of networks that common internet browsers don’t index.
As Emily Wilson, CFE, points out in the latest cover article of Fraud Magazine, content on the dark web is designed to be hidden from search engines and from casual users. We can’t simply stumble across dark web sites by accident, Wilson writes. However, we might be surprised to learn that the dark web, which conjures images of abhorrent crimes, also stores legitimate common data and allows legal transactions.
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Matt White, Jacoba Ballard and Heather Woock all grew up in or around Indianapolis, Indiana, never having met one another and never imagining that they might share the same biological father. In the years 2014 to 2016, all three were in their 30s and all individually decided to partake in the recent popularity of DNA test kits, which led them to discover their shocking biological connection. After a series of messages and meetups with others who shared the same DNA, the half-siblings gradually discovered a whole circle of more than 50 people who share half of their genetic makeup. The uniting parent? Donald Cline, a fertility doctor who secretly used his own sperm to impregnate patients seeking his counsel during the 1970s and 80s.
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In April 2019, the U.S. Department of Justice (DOJ) issued new guidance designed to assist federal prosecutors in evaluating corporate compliance programs. In criminal cases, prosecutors will use the new guidance to determine whether a company’s compliance program was adequate and effective. This determination is important because companies can receive more lenient treatment if they had an effective compliance program in place at the time of the offense.
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Much has been written and recorded about Elizabeth Holmes and her biotech start-up Theranos, once valued at more than $10 billion. ABC Radio recently released a six-episode podcast titled “The Dropout” that chronicles the rise and fall of the figure who critics have come to call the 21st century’s Bernie Madoff, and dedicated followers of the years-long fraud scandal will recall the original Wall Street Journal reports by John Carreyrou that drew national attention to the fraud when they were released starting in 2015. Carreyrou subsequently published the impeccably-researched Bad Blood, a critically-revered book that chronicles the intricacies of the scandalizing saga. For those who prefer the filmic format of delivery, HBO put out a gripping documentary that provides all the requisite information in a mere two hours, a minuscule time investment in comparison to the decades-long fraud for which Holmes continues to face legal battles.
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Last month, the New York State trial against Anna Sorokin, the 28-year-old wannabe socialite who fooled Manhattan’s elite into believing she was the heiress of German billionaires, officially began. Known among other fixtures of New York City’s social scene by her fake name, Anna Delvey, Sorokin faces charges of theft of services and grand larceny after her 10-month stint staying in luxury hotels, jetsetting to high-end vacations, and racking up a nearly $275,000 debt while emulating the lifestyles of the rich and famous.
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Netflix’s new documentary Fyre: The Greatest Party That Never Happened (dir. Chris Smith, 2019) chronicles the saga of a failed luxury music festival in the Bahamas. The event’s promoters defrauded top investors, the local Bahamian community, and hundreds of individuals who paid high prices in the hopes of listening to famous bands and DJs while surrounded by lavish beach houses and scenic waterfront views.
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The days of the traditional college classroom, where the professor lectures on a topic and later gives exams on that material, are gone forever. The preferred style today, both by the professor as well as the student, is case-based learning. Students are expected to do the relative background reading beforehand and come to class ready to take on a case study, laser focused on the topic. Faculty spend their time doing the research and writing the case study for use in the classroom. This is a lot more interesting for all involved, students and faculty alike. It drives home the salient points of the subject matter and gives the students more real-world experience.
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In the most recent episode of the ACFE’s podcast, Fraud Talk, Julia Johnson, CFE, Research Specialist at the ACFE, breaks down three recent case studies of frauds that were committed from behind bars. She explains how the schemes were perpetrated and what fraud examiners can learn from each case.
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If you ask any internet search engine to execute a query about “gambling” and “fraud,” almost all information returned will be addressing the fact that gamblers are typical potential fraudsters. Indeed, gambling addiction generates pressure to commit fraud and is considered a high fraud risk factor. Gamblers will try anything to continue feeding their excessive gambling habits. Most fraud examiners are aware of this risk, and organizations should be attentive to their employees’ conduct. If a gambling problem rises, the organization should assist the employee through adequate employee support programs.
However, rarely do we see anyone raise the matter that gamblers could be defrauded too. Subconsciously, we might act as if gamblers are wrongdoers and therefore have no rights to claim. This bias would prevent us from admitting that gamblers are consumers and should be considered so. And if they are victims of a fraud scheme, they deserve it. It’s a punishment “morally” deserved.
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Everyone in every generation is at risk of becoming a victim of fraud. And with the emergence of the World Wide Web in 1991, the continuing evolution of technology and the fraudsters who are keeping pace with today’s technological advances, the types and occurrences of fraud are ever-increasing.
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"The bravest man I’ve ever known.” This description of Sergei Magnitsky by Bill Browder, a keynoter at the 30th Annual ACFE Global Fraud Conference, June 23- 28 in Austin, provides a poignant insight into the life of an internationally known whistleblower who dared to take on corruption within the Russian government.
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Organizations that implement proactive data monitoring detect frauds 58% faster and experience losses that are 52% lower than organizations that don’t, according to the ACFE’s 2018 Report to the Nations. As these numbers indicate, harnessing your organization’s data can have a significant impact on your efforts to detect and prevent fraud. But introducing data analytics into your fraud-fighting toolbox is not a cut-and-dried process. There’s no universal checklist to follow. Every organization has different data to work with, and unique priorities and organizational goals. It takes a hands-on approach to figure out what will work best for you and your organization.
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Most organizations understand that collaboration is a pillar of a successful company, yet in practice, it often does not happen. It is important and necessary to have goals and targets because they push your organization to perform at a higher level. However, without communication and collaboration between teams, the metrics can unknowingly pit departments against each other.
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When I started teaching at Embry Riddle Aeronautical University, I was the first full-time accounting instructor they had hired. There was a small team in the Department of Business that included five full-time professors and a handful of adjuncts, but the school and the business department were growing. During the summer of 2013, my chair called and asked if I’d be willing to write the curriculum for an entire bachelor’s degree program in forensic accounting and fraud examination. In hindsight, I really should have asked more questions! But not knowing what all this entailed, I jumped in with both feet and said yes.
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CBS News recently reported the results of an investigation into a large-scale, wide-reaching Medicare fraud scam that has been affecting dozens of people across the United States. The story illustrates the struggles faced by senior citizens who were targeted primarily by a company called Genexe Health, which claims to be a genetic testing “one-stop shop.”
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“It’s very important to rely, not just on your competence, but also, to carry yourself with confidence.”
This quote is from ACFE Regent Bethmara Kessler, CFE. She shared it at the Women’s Networking Reception at the 29th Annual ACFE Global Fraud Conference. Her words touched many people at the conference, and they were specifically relevant to me. They set me on a path over the last year of exploring the concept of confidence.
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As Warren Buffett once said, “It takes 20 years to build a reputation and five minutes to ruin it.” Reputation equals integrity and integrity equals social responsibility. By sustaining the “social license to operate” through social responsibility, organizations ensure that business practices, operating procedures and corporate behaviors are acceptable to employees, stakeholders and the public.
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The theme of this year’s conference was Step Up, Stand Out. As I reflected on what that means to us as fraud examiners, I realized it was more than just a snappy phrase. There are a few trends in our profession that run parallel to this year’s theme.
Stepping up and standing out — two actions that can at times be uncomfortable and confrontational, but also exhilarating and rewarding.
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In February 2019, a Meals on Wheels bookkeeper pleaded guilty to stealing more than $88,000. According to court documents, between May 2013 and April 2018, the bookkeeper had access to the organization's bank accounts, debit cards and payroll system. Documents said the bookkeeper used the bank accounts to pay for things like her mortgage, utilities and property tax payments. She frequently disguised these transfers in Meals on Wheels’ internal accounting system to make them appear as they were legitimate Meals on Wheels expenses.
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To say child identity theft is a lucrative market would be an understatement. More than 1 million children were victims of identity fraud in 2017, resulting in a loss of $2.6 billion dollars, according to Javelin Strategy and Research’s Child Identity Fraud Study. So, why does that matter to you as a fraud examiner?
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Ever wanted to try your hand at running a Ponzi scheme, banking assets in offshore accounts or fleeing the country to escape legal investigations? In Fraud: The Game of White-Collar Crime, players have the unique opportunity to step inside the shoes of corrupt CEOs on a mission to bribe, cheat and defraud opponents as they race to bank $150 million before they collect three indictments.
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Fraud is pervasive in the health care field, but one area that has recently come into focus is the ambulance transport industry. While most emergency vehicle providers are ethical, there are a few out there who have taken a detour down the wrong road. Here are examples of common fraud schemes to look out for in this industry, along with real-life examples of when these schemes were perpetrated.
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The ACFE invites you to sign up for the upcoming 90-Day CFE Exam Challenge to earn your Certified Fraud Examiner (CFE) credential by December 31, 2019. The challenge is designed to help you work through the CFE Exam Prep Course and Prep Toolkit materials to successfully complete the exam in three months.
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Attention, fraud fighters! To celebrate the 30th Annual ACFE Global Fraud Conference, we invite you to join us and Forensic Strategic Solutions (FSS) for an upcoming Twitter chat. Our topic is “30 Years of Fighting Fraud.” We’ll discuss how the anti-fraud profession has evolved over the past 30 years and how fraud fighters have stepped up during that time. We hope to see you there with your own stories and experiences to share.
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Please join us and the Identity Theft Resource Center (ITRC) for our upcoming Twitter chat during International Fraud Awareness Week. Our topic this year is, “Who Is Responsible for Fraud Prevention?” Fraud Week runs from November 17-23, 2019, and is a global effort to minimize the impact of fraud by promoting anti-fraud awareness and education. For the Fraud Week Twitter chat, here are some basic guidelines to help you get the most out of it.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by June 30, 2019. The challenge arms you with study tips and peer support to help you stay motivated and on track to reach your professional goals. Our upcoming challenge starts Monday, April 1 and ends Sunday, June 30.
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Signups are now open for the 2020 ACFE Mentoring Program – Session 1. If you’ve got big dreams for your career in 2020, this is a fantastic opportunity for you to take tangible steps toward making them come true.
The ACFE Mentoring Program connects anti-fraud professionals at any stage in their career with other members. Whether you’re just starting out or have been a Certified Fraud Examiner (CFE) for many years, there’s a place for you in the mentoring program.
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In the latest episode of the ACFE’s podcast, Fraud Talk, Jeremy Clopton, CFE, CPA, director at Upstream Academy, sat down in our studio to discuss the top five areas where we typically see conflict arise from generational differences in the workplace. But, he didn’t stop there; he shared advice for overcoming these conflicts and how we can move forward in 2020.
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Intuition. It drives fraud examiners in their daily pursuits to uncover or prevent fraud in their organizations. But CFEs are trained to do this work. Tyler Shultz, our 2019 Sentinel Award winner, wasn’t a CFE. He was a young, idealistic, budding scientist who helped unravel one of the most prolific frauds in years. His intuition led him to start questioning what was going on at Theranos, a blood-testing company founded in Silicon Valley. He knew his test results and observations didn’t match what the company was publicizing. He suspected Theranos CEO Elizabeth Holmes wasn’t being completely truthful.
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The ACFE bestows our Cressey Award annually on someone who’s demonstrated a lifetime of achievement in the detection and deterrence of fraud. This year’s winner couldn’t be more deserving. Lisa Osofsky, the director of the U.K.’s Serious Fraud Office (SFO), has devoted a lifetime of service to fraud awareness on a global scale. In fact, she picked up the desire to prosecute quite early when she worked with prosecutors before she even finished law school!
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Dhara Bhatt, CFE, CPA, is a manager of compliance and monitoring at Sage Therapeutics, Inc., a biopharmaceutical company headquartered in Cambridge, Massachusetts. As a biotechnology compliance professional, Bhatt strives to create a comprehensive compliance program that can navigate the intricacies of the industry. To do this, Bhatt relies on her love of problem-solving to come up with unique compliance solutions. Always with an eye toward the future, Bhatt looks forward to the work that each new day will bring.
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Dr. Maria Krambia Kapardis already has a long list of accolades in the anti-fraud industry. She helped found the ACFE Cyprus Chapter and Transparency International Cyprus. With her advocacy work and research, she has worked with the Ministry of Justice and Public Order in Cyprus to prepare legislations on whistleblower protection, lobbying and asset declaration for elected politicians. She also worked with Cyprus’ President to create a national action plan against corruption and helped set up an anti-corruption agency, all while maintaining her full-time job as an associate professor at Cyprus University of Technology. For her efforts, she was recently named the 2019 winner of the ACFE’s Outstanding Achievement in Outreach/Community Service Award.
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Jennifer Hung, CFE, is a senior program analyst in heightened scrutiny/compliance at the Schools and Libraries (E-rate) Program in the Universal Service Administrative Company (USAC). USAC is an independent not-for-profit organization designated by the FCC to administer the Universal Service Fund (USF). Jennifer is a detailed-oriented problem solver and always strives to develop and maintain the program integrity and ensure the reduction of waste, fraud and abuse. She currently resides in Washington, D.C. and loves traveling. Her footsteps have touched every continent in the world. She also enjoys the arts and music programs D.C. has to offer. In addition to being a frequent volunteer at the concerts series from the Library of Congress, Jennifer also serves as a special event volunteer at the Smithsonian National Zoo and Cultural Tourism D.C.
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Maheswari Kanniah, CFE, has decades of experience working in financial institutions and currently is the executive director/group chief regulatory and compliance officer for Kenanga Investment Bank Bhd. (KIBB) in Malaysia. While she spends a lot of time balancing regulatory compliance with business needs, she places a high value on educating other employees about fraud and fraud prevention. Her work in spearheading KIBB’s support of International Fraud Awareness Week, November 17-23, 2019, has greatly helped spread fraud awareness within her organization, and she encourages other organizations to follow suit.
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Mitchel Huffman, CFE, works as a staff accountant at Rea & Associates, a “top 100” accounting firm based out of Ohio. Earlier this year, Huffman was thrilled to get the two years’ experience needed to become a CFE. During his time with Rea & Associates, Huffman has done both tax and assurance services. He was originally more interested in the tax route, but due to his firm’s assurance department needing staff, he shifted his focus to assurance work. As Huffman became more familiar with this work, he started to really enjoy it and is looking forward to where it takes him in the future.
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Yelesina Hernandez is the recipient of the 2019-2020 Ritchie-Jennings Memorial Scholarship. Hernandez is a junior at the C.T. Bauer College of Business at the University of Houston, and she is majoring in accounting, set to graduate in Fall 2020. She hopes to become a CFE in the future. Here’s how the scholarship has helped her get closer to meeting that goal.
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Janet Miller, CFE, is a mentor in the ACFE Mentoring Program. Janet spent more than 10 years in the Oil and Gas Industry as an auditor and is now a Senior Internal Auditor for a major healthcare organization in Houston, Texas. Janet hopes that her experience and knowledge will help inspire others in their efforts to detect and prevent fraud. Janet participated in the first session of the ACFE Mentoring Program, and her mentee was Lisa Smith.
Lisa began her career in computer application development and later pursued a career in investigation after graduating with a degree in Criminal Justice. Lisa runs a small Etsy business, is an avid genealogist and likes to occasionally ride her Harley motorcycle to relieve some stress. These two members worked together over the course of six months to help Lisa reach a big professional goal. Here’s more about their journey together.
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Natasha Williams, CFE, is a mentor in the ACFE Mentoring Program. She has more than 20 years combined experience in auditing, banking, compliance and accounting. She has managed audits across the globe throughout Europe, Latin America and the Asia-Pacific region. She has experience consulting small startups as well as working with large, complex global companies. Natasha participated in the last session of the ACFE Mentoring Program and had two mentees. One of those mentees was Mariam Afzal.
Mariam is an Audit Lead at United Airlines. She wanted a mentor who could help her build a professional brand in the in the anti-fraud community. Here is more on their mentoring relationship.
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After being a CFO for a global health care leader in the Middle East, Rémi Gayraud, CFE, dedicated more than 10 years in investigations and project management to forensic firms as a partner with Grant Thornton. Rémi now works on the corporate investigations team for a science-led health care company overseeing Europe and Africa. He’s also a co-author of two French books and has collaborated with ACFE’s president and CEO, Bruce Dorris, on the first CFE Exam Review Course in France. Rémi is part of the ACFE Mentoring Program. He serves as a mentor, and one of his former mentees was Thomas Bouloutsos.
Thomas is an Assistant to Internal Audit for a European Union Agency. Thomas joined the ACFE Mentoring Program because he hoped to meet and connect with others in his field. He also wanted to create a solid career path for himself with the guidance of a seasoned professional. These two created a lasting friendship and have a few tips to share with those who are considering joining the ACFE Mentoring Program.
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Stephen Pedneault, CFE, CPA, is the Principal of Forensic Accounting Services, LLC, a CPA firm focused exclusively on forensic accounting, fraud and litigation support matters. Through his investigative work, Steve has examined frauds ranging from a few thousand dollars to amounts well in excess of $5 million. Steve recently participated in the ACFE Mentoring Program, where he served as a mentor for Melissa Frausto.
Melissa, founder and owner of A Paper Trail, is a CFE with years of accounting experience but wanted to take her career to the next level by starting her own consulting practice. That’s where the Mentoring Program came in. She was looking for a mentor who could help guide her through this rocky, uncertain territory.
Together, Steve and Melissa forged a strong partnership that is still in place today. They have some wisdom to share with those who are considering joining the ACFE Mentoring Program.
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Have you bought your tickets for Rihanna’s 2019 tour? Trick question: though fans have speculated that the pop star will announce a new album soon, the singer has given no indication of a 2019 tour. Some entertainment industry scammers, however, recently attempted to extort millions of dollars from investors to fund fake concerts by celebrities Rihanna, Janet Jackson and Bruno Mars.
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In 2009, NASA’s Orbiting Carbon Observatory mission failed after the satellite couldn’t reach its intended orbit because the structure that encapsulates the satellite during launch refused to separate from the vessel upon command. The same malfunction occurred in 2011, when NASA’s Glory mission satellite was destroyed in the atmosphere after its shell did not open fully. After years of technical and mechanical investigations, NASA Launch Services Program announced on April 30 that they had located the root cause of the mission failures: faulty metals sold to NASA by Sapa Profiles Inc., an aluminum manufacturing company based in Oregon.
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As tax season in the U.S. approaches, it's unfortunately common for individuals to file their taxes only to find out that someone has already claimed their return. This type of identity theft can be upsetting, but it may be even more upsetting if they found out their identity was stolen not through a fault of their own, but due to their employer falling victim to a scam. To help combat this, the IRS announced the 4th Annual National Tax Security Awareness Week, taking place December 2-6, 2019.
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International Fraud Awareness Week officially begins on Sunday, November 17. Right now, we have nearly 550 supporters from around the world, and new supporters are signing up every day. This is gearing up to be the biggest Fraud Week ever! In order to help you in your Fraud Week efforts, we have some new and noteworthy resources for Fraud Week supporters this year.
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Through WhistleB’s annual survey on organizational whistleblowing, we ask our customers about how they use their whistleblowing system and the outcomes that arise from having a secure, digital whistleblowing system in place. These are some of the key findings:
An increased number of whistleblowing reports received.
Almost a third of all cases related to fraud, economic crime or money laundering.
The whistleblowing channel seen as a key tool for building trust.
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After nearly a decade of legal proceedings, Manhattan District Judge Kevin Castel has condemned four siblings to jail sentences, each of less than a year, for an extensive tax fraud scheme. The siblings — Suzanne, John, Henry and Yvonne — were all children of Harry Seggerman, a vice chairman of Fidelity Investments who made millions by investing in Japanese and Korean companies. When Harry died in 2001, he left his children a vast estate worth $24 million. This included $12 million in a secret account in Switzerland, stashed there to evade taxes. Faced with the decision to report the inherited money or to maintain their father’s legacy of tax fraud, the siblings chose to keep up the farce, a decision that is finally bearing consequences.
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Fraud inherently deals with lots of numerical data and fraud examiners are experts at diving into those numbers and finding evidence of wrong-doing. However, with balance sheets, ledgers, expense reports and other dense documents at the forefront of many investigations, it’s easy to forget the stories of those people affected by the fraud.
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As an anti-fraud professional, may consider yourself a natural born skeptic. Your job requires questioning all that is presented to you. While others may prefer to take things at face value, you are trained to dig deeper and ferret out important information. But if that doubting nature should be common sense in the course of an investigation, why is professional skepticism included as a requirement in auditing standards?
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Anti-fraud professionals know that while it’s best to catch fraud as soon as possible, it’s even better to stop fraud before it happens — which is why active fraud prevention is a critical part of anti-fraud strategies for organizations of any size. Some people may still be afraid to talk about fraud, believing that if they raise the topic, employees will suddenly become inspired to attempt to commit fraud, or that employees will think the reason it has been brought up is because a large fraud has just taken place. However, discussing fraud openly with employees is a great way to help prevent it.
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Modern technology advances quickly. What’s innovative and fresh one day can be quickly outdated and short-lived in just a few months.
As smart devices get smarter, business and industry depend more heavily on them and the data they store, which makes fraud examinations more challenging and complex.
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Since the rise in popularity of social media, there have been new rules created around social norms and professionalism — something to keep in mind when considering your personal social media privacy behaviors. Here’s a high-level overview of the many different considerations you should make in order to maintain safe, healthy levels of social media privacy.
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ACFE local chapters around the world have really done a lot to spread fraud awareness during Fraud Week. The ACFE has nearly 200 chapters that are comprised of anti-fraud professionals with a range of backgrounds, and for Fraud Week 2019, many of those chapters are hosting a variety of creative learning activities, widespread knowledge campaigns and more to spread anti-fraud education in their communities.
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This past June, John Sopko, the Special Inspector General for Afghanistan Reconstruction, released “Divided Responsibility: Lessons Learned From U.S. Security Sector Assistance Efforts in Afghanistan,” a report detailing the progress of U.S. security sector assistance efforts focused on Afghanistan since 2001. In the report, Sopko outlines the factors that led to massive operational failures in the mission to develop the Afghan National Defense and Security Forces, the Ministry of Defense and the Ministry of Interior.
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Throughout 2019, we published 114 posts on ACFE Insights — the most we’ve ever shared — and 33 guest authors contributed their expertise and insights to nearly half of those posts. Because of their willingness to share knowledge, ACFE Insights has seen a tremendous amount of growth in readership.
Contributors, please except our heartfelt thanks for being so generous with your knowledge. Readers, thank you so much for coming to the site and reading, discussing and sharing posts from ACFE Insights this year.
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Today, March 8, the ACFE is proud to recognize more than 30,000 female anti-fraud professionals in honor of International Women's Day. We created a page on our website to share articles, resources and profiles of the women dedicating their time to fighting fraud. I also wanted to share a few of the quotes and stories we heard from women over the past year.
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On the CFE Exam there are a few questions about the ACFE Code of Professional Ethics. The good news is that most of these questions are very straightforward and shouldn’t give you any trouble. Things like “don’t violate the law” or “don’t engage in conflicts of interest” are pretty self-explanatory. But there are two areas that I have found sometimes cause people a little confusion.
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Valentine’s Day offers couples in the U.S. the chance to unabashedly revel in their romantic happiness. You might spot posts from friends and family online, wherein they wax poetic about the incredible, amazing person they love. Or you might notice several individuals walking out of the grocery story with balloons and roses and chocolates, their head held high because—oh!—they are in love. You might find it hard to get a table at a restaurant because they’re all occupied by couples muttering sweet nothings to each other. It’s a great day to be alive and in love.
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Operational resilience is a set of techniques that allow people, processes and informational systems to adapt to changing patterns. In other words, it is the ability to alter operations in the face of changing business conditions. Operationally resilient enterprises have the competency to ramp up or slow down operations in a way that provides a competitive edge, and enables quick and local process modification.
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Technological advancements present opportunities for both fraud perpetrators and those trying to stop them. As criminals find new ways to exploit technology to commit their schemes and target new potential victims, anti-fraud professionals must ensure they are likewise adopting new technologies that are the most effective in navigating the evolving threat landscape.
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A recent Reuters article about the “expense report of the future” included a discussion about the future of fraud risk management and the use of robotics. Though not a new discussion, this article highlighted the most common uses of the technology without using the trendy approach of claiming robots are taking over.
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In the latest episode of Fraud Talk, Scott Porter, CPA, CA, and Senior Investigator at CPA Ontario, shares techniques to assist fraud examiners conducting investigative interviews in corporate settings. He also explores traditional law enforcement interview models, and offers emerging alternatives to enable practitioners to conduct ethical, legal and effective interviews.
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In the October episode of Fraud Talk, asset recovery lawyer Martin Kenney, CFE, shares stories from his decades-long career in finding money lost to fraud and corruption.
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Where do you draw your ethical line? Would you take a coworker’s apple from the community fridge? Would you snag a couple of pens from your employer? Would you pay the parking meter if there’s only ten minutes left on the clock? Would you embezzle $10,000 from a company worth $50 million? In the most recent episode of Fraud Talk, John Gill, J.D., CFE, ACFE Vice President-Education, sits down with Art Markman, Ph.D., a professor of psychology and marketing at the University of Texas, to discuss how and where we all draw our ethical lines.
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Published in September of 2018, Tom Wright and Bradley Hope’s Billion Dollar Whale: The Man who Fooled Wall Street, Hollywood, and the World is a detailed depiction of one of the largest, most sprawling financial fraud schemes of the 21st century. Wright and Hope, two long-time Wall Street Journal reporters, take the reader through the almost unbelievable tale of Jho Low’s rise to conspicuous wealth and international stardom. As Wright and Hope outline in their author’s note, they hoped not only to explain Low’s methods and motives but also to present a “larger portrait, about capitalism and inequality, told through the life of Low.” By exposing the links between big banks, kleptocracy, and corruption within Hollywood and Wall Street, Wright and Hope elucidate the structural concerns that enabled Low’s scheme while crafting a gripping narrative of infuriating oversights and ostentatious decadence.
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If I hadn’t pursued my passion for the anti-fraud industry, I might have been lost in the uncertainties of life, or at least I wouldn’t have learned to embrace the uncertainties in the early stage of my career.
Growing up, I was a kid who loved to plan ahead and avoid risks as much as possible. My senior year I decided to pursue my second greatest career passion — becoming a university professor — and get a Ph.D. in accounting. This path seemed more predictable compared to a path of pursuing my greatest career passion, which was to become a fraud investigator. My so-called “safe” plan fell part in spring 2016 when I got rejected from all 12 doctorate accounting programs I had applied for.
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When the FBI shut down the infamous darknet black market website Silk Road in 2014, the bureau embarked on investigations to seize bitcoin quantities earned through illegal transactions on the website, later selling those bitcoins for more than $48 million. Silk Road, founded in 2011 by Ross Ulbricht, played host to more than $200 million in cryptocurrency transactions during its online tenure. In 2015, Ulbricht was sentenced to serve a double life imprisonment for drug trafficking, computer hacking and money laundering, but because of the encrypted nature of cryptocurrency transactions, many of the site’s users who profited from the sale of illegal goods remain anonymous and untraceable.
Until now.
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Whistleblowers across the European Union (EU) have won greater protection under landmark legislation aimed at encouraging reports of wrongdoing. According to the BBC, “The new law, approved by the European Parliament, shields whistleblowers from retaliation and creates "safe channels" to allow them to report breaches of EU law. It is the first-time whistleblowers have been given EU-wide protection.
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When traveling, you might be opening yourself up to new tactics of identity theft without even realizing it. With everything from hotel rooms to public Wi-Fi being a risk, it is important to stay on your toes when you’re away from home – whether for business or leisure. Even the most diligent of people can fall victim to a scam or make the wrong move, which can result in identity theft.
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When you think of how the Panama Papers unfolded, you could imagine a scene from a movie: a hero with great hair meeting with an anonymous source on a park bench and exchanging code words. But, as we know, our realities can be much stranger than fiction. The initial exchange of the Panama Papers began at Bastian Obermayer’s parents’ home in Germany.
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A fraud scheme was recently uncovered in a Tunisian city’s largest hypermarket (also known as a supermarket) when a customer suspected an inflated receipt while paying for his items. By checking the store receipt provided by the cashier, he noticed that some item unit prices did not match the prices displayed on the shelves. He went back to the store and took pictures of the price tags of the corresponding items with his cellphone. Then, he called the store supervisor and asked for explanations as to the difference between the price tags and the prices charged on the receipt. We learned after through the local press to whom the customer reported the facts that he was not given any relevant rationale about the price difference but was nevertheless reimbursed.
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There's a simple thread that connects entrepreneurs and conmen. In the latest episode of Fraud Talk, Alexander Stein, Ph.D., discusses this connection and dissects how the psychodynamics of fraud can help fraud examiners spot the differences between ethical employees and malevolent ones. You can catch Dr. Stein as a keynote speaker for the upcoming ACFE Fraud Conference Canada in Montreal, October 20-23, 2019.
Below is an excerpt from the full transcript of the discussion, which you can download in PDF form, or you can listen to the episode.
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It’s International Fraud Awareness Week. Many of you have signed up as supporters, and some of you have also submitted great events on the Fraud Week site. Fraud Week is the perfect time to go a step further in your role as an anti-fraud professional to start discussions among peers, coworkers, executives and stakeholders in your community about how important fraud prevention is to society as a whole. Our members are on the front lines in the fight against fraud, so recently, we asked them, “What does fighting fraud mean to you?” Here’s what they had to say.
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Benford’s Law can be a tricky concept to grasp at first, but it provides an extra method for fraud examiners to test data for potentially fraudulent activity. Here’s more on what it is exactly and how fraud examiners can use it.
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One of my colleagues from the Agri-Business department of the Cornell SC Johnson College of Business, knowing my interest in fraud examination, forwarded me an article about a $5 million-dollar fraud that occurred at a Minnesota agricultural cooperative. Published in the online magazine Successful Farming, author Laurie Bedord does a fine job outlining how coop manager, Jerry Hennessey, carried out the crime that lasted over the last 15 years, his motivation for the crime as well as what systems of internal control where lacking that allowed the fraud to be committed in the first place.
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We recently co-hosted a Twitter chat with the Identity Theft Resource Center in support of International Fraud Awareness Week. Our topic for the chat was “Who Is Responsible for Fraud Prevention?” This year, we had 107 participants and 474 tweets that used the #fraudweekchat hashtag. If you didn’t get a chance to join the Twitter chat this year, here are some of the most incisive insights shared throughout the fast-paced discussion.
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Fraud befalling your organization can be a scary experience. Even more chilling is when companies die from widespread fraud schemes. In the latest video from the ACFE, the grim reaper takes us through some of the pieces in the ACFE Fraud Museum that serve as tombstones for companies that perished due to fraud. Happy Halloween from the ACFE!
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Payment card fraud detection involves banks and financial organizations leveraging analytics to delve into card transaction data and build counter-fraud models. Over the years, the discipline of fraud analytics has evolved to crafting machine learning algorithms which recognize highly complex fraud patterns in enormously large volumes of records.
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In 2015, Asher Burke started Ads Inc., which claimed to be a digital marketing firm, but which was actually a company that used the “subscription trap” structure — a method that tricks people into buying what they think is a single, free trial of a product, only to have actually unwillingly committed to a pricey monthly subscription that is purposefully designed to be difficult to cancel. Here’s how it worked.
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Sarbanes-Oxley, my how you’ve grown. It is hard to believe that the Sarbanes-Oxley Act of 2002 turned 20 years old in July. While some of us feel like we are in 2019 or 2020, still trying to process the way the world has been influenced by the pandemic, surely SOX wasn’t TWENTY YEARS AGO? Yet, here we are. Arthur Andersen, Enron and WorldCom certainly left behind a legacy that changed the financial world, especially that of the public company.
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Since 2000, organizations around the world have joined the fight against fraud during International Fraud Awareness Week, or Fraud Week. Every year, the Association of Certified Fraud Examiners (ACFE) creates new educational resources for organizations to use to spread the word about fraud prevention and awareness, but groups are encouraged to create their own activities to make the yearly event their own.
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Each year, Certified Fraud Examiners (CFEs) in good standing are given the opportunity to help foster the growth and development of the anti-fraud profession by casting votes for the Association of Certified Fraud Examiners (ACFE) Board of Regents. ACFE Regents are tasked with setting and maintaining standards for the organization to promote professionalism and ensure the reputation of the CFE credential.
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The ACFE is proud to announce that Collins Wanderi, CFE, Chrysti Ziegler, CFE and Wendy Wilder Evans, CFE, have been elected to the 2022-2023 ACFE Board of Regents. Fellow CFEs elected them from candidates selected by the Board's nomination committee. Wanderi, Ziegler and Evans will take office at the Board's meeting in February at ACFE headquarters in Austin, Texas.
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In today’s modern age almost every business is dependent on the internet and information technology to accomplish a variety of daily operational tasks. From emails to e-commerce and e-banking, sensitive business activities are conducted via the internet. While the internet has undoubtedly made it easier for businesses of all shapes and sizes to operate, it has also made it easier for cybercriminals to gain access to confidential information and systems.
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Abigail had her first introduction to the fraud industry when a former coworker referred her to an open position at their health insurance company. Later she began her work as a Fraud Coordinator in 2018 and since has made the transition to becoming a Fraud Analyst. In 2021, Abigail joined the 90-Day CFE Exam Challenge, where she was able to study and pass her exams within 90 days.
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After years of experience leading hundreds of fraud-related investigations, Dr. Tim Klatte, CFE made the decision to prepare for the CFE exam with the help of the 90-Day CFE Exam Challenge. “I have been a Forensic Accounting Partner in Shanghai, assisting clients with sensitive risk management matters since 2011. Although I have many years of practical forensic experience and have led hundreds of fraud-related investigations, I never made the time to prepare and pass the CFE. The 90-Day CFE Exam Challenge provided the exact motivation I needed to cross the finish line.”
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The Association of Certified Fraud Examiners (ACFE) is excited to announce a new resource focused on aiding anti-fraud professionals working alongside government entities at local, state, national and international levels to continue enhancing their fraud-fighting toolkits. Now available at ACFE.com/Government, this new hub offers multiple forms of content for government and public administration professionals to expand their knowledge base and continue developing skills essential to the prevention and detection of fraud at various levels of government.
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The U.S. Department of Justice (DOJ) announced in early February 2022 that they had arrested two individuals, Ilya Lichtenstein and his wife Heather Morgan. When the couple was arrested in connection with the theft of cryptocurrency from the Bitfinex cryptocurrency exchange in 2016 and subsequent laundering of the proceeds, it led to one of the most valuable seizures of illicit proceeds in law enforcement history.
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It comes as no surprise to learn that Lisa Osofsky is stepping down next summer after five years as head of the U.K.’s Serious Fraud Office (SFO). Ms. Osofsky has overseen an often contentious five years at the helm of the U.K.’s leading fraud prosecution agency. She has made several significant mistakes, which Tony McClements (our firm’s head of investigations) and myself have both commented upon, most recently when Tony suggested that the SFO should be merged with Britain’s FBI-equivalent, the National Crime Agency (NCA).
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Mobile Fidelity Sound Lab (MoFi) is best known by audiophiles and hipsters alike as a record label specializing in the production of reissued vinyl LP records, compact discs and Super Audio CDs that, even in our digital era, remain a popular and sought-after commodity. As anti-fraud professionals know, however, what you see is not always what you get. The same goes for what you hear. On July 14, 2022, Mike Esposito, owner of The ‘In’ Groove record store in Phoenix, Ariz., posted a YouTube video that sent the audiophile world spinning. Citing an unknown but “reliable” source, Mike stated that MoFi has been using digital files in its production of so-called original master tape albums despite marketing the reissues as authentic.
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The Fraud Examiner newsletter, released each month by the Association of Certified Fraud Examiners (ACFE), features in-depth research articles and insights into trending topics in the anti-fraud industry.
This exclusive, members-only newsletter includes works authored by Certified Fraud Examiners (CFEs). These authors are CFEs in good standing who are looking to have their expertise and experiences published and shared with thousands of anti-fraud professionals around the globe.
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A few years ago, I worked overseas as the director of internal audit and investigation. The organization’s headquarters had seven other support organizations to protect U.S. territory and resources. The director of the moral, welfare, and recreation (MWR) received funding from the federal government to take care of soldiers, civilian employees and their families for all recreational and morale booster activities. One of the latest programs was the Warrior Adventure Quest (WAQ) Program. WAQ was developed by the Army Medical Department; it is an Army RESET training tool designed to introduce soldiers to activities that serve as alternatives to aberrant behaviors often associated with accidents involving recently re-deployed soldiers. This tool presents coping outlets to help soldiers realize their own new level of normalcy after deployment and move on with their lives.
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Recently, I worked on a case wherein a whistleblower raised allegations on two employees that the company was engaging in unethical practices. The allegations included bribery and corruption, conflict of interest, breach of code of conduct, misappropriation of assets, high prices and poor quality of products supplied and abuse of position.
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How many times have you seen an ad on social media asking you to donate to a cause? Our natural tendency is to sympathize with these causes, which often compels us to donate money and/or property. Unfortunately, not all causes we are called to join have a noble motive; some of them are organized by unscrupulous individuals who take advantage of our generosity to steal our money.
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The sums involved in the latest high-profile cryptocurrency fraud are mind-blowing. A self-proclaimed amateur rapper nicknamed the “Crocodile of Wall Street,” Heather Morgan, along with her husband Ilya Lichtenstein, were arrested and charged with conspiracy to allegedly launder $4.5 billion in stolen Bitcoin last month.
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The head trader of EmpiresX, a global cryptocurrency platform headquartered in Florida, pleaded guilty on September 8 in an alleged investment fraud that raised around $100 million for the company, according to the U.S. Justice Department. Joshua David Nicholas, 28, admitted to the securities fraud in which he and others at EmpiresX falsely claimed their business’ trading bot, which utilized artificial and human intelligence, mitigated risk and increased the chances of profitability on an investment.
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The growing trend of shoppers preferring pajamas and pumpkin pie to cold weather and crowds reached an all-time high in 2021 as online shopping for the holiday season soared due to the COVID-19 pandemic. In 2022, global online sales again hit a new high of $281 billion during Cyber Week (Thanksgiving Day through Cyber Monday); that figure was up 2% from the pandemic season, according to Salesforce, with Cyber Monday alone accounting for $11.3 billion in online sales, according to Adobe Analytics. Black Friday, by comparison, reached $9.12 billion in online sales and reportedly light foot traffic.
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Alex Gibney has documented many fraud cases in his three decades as a filmmaker. From his first big hit in 2005, “Enron: The Smartest Guys in the Room,” to the more recent documentary about Elizabeth Holmes, “The Inventor: Out for Blood in Silicon Valley,” Gibney has long been exploring the psychology of deceit and why bright and talented people turn to the dark side.
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After seven days of deliberations, a jury in California found Theranos founder Elizabeth Holmes guilty on four out of 11 federal fraud charges on January 3, 2022; nearly four years after Holmes and Theranos agreed with the U.S. Securities and Exchange Commission (SEC) to settle civil charges of securities fraud. Each charge carries a maximum prison sentence of 20 years.
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Here at the ACFE, we are committed to providing you with the tools necessary to achieve your professional goals. To help you do that, we’ve been working diligently to make improvements to our website that will support you in your anti-fraud efforts. Now, we are excited to share the newly redesigned ACFE website with you.
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Technology tends to expand at lightning speed, and the emergence of quantum computing may be no different. More and more organizations are exploring this new frontier; its impact on the fraud-fighting field could be enormous. Quantum computing will be able to handle operations at speeds far greater than the average computers on which we now depend.
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On Thursday, a jury of seven women and five men convicted Ramesh “Sunny” Balwani on 12 counts of federal fraud. Balwani, the former COO of Theranos, reportedly sat expressionless as the verdicts were read in court. Some of the charges Balwani was found guilty of included federal wire fraud and conspiracy to commit federal wire fraud.
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While victims of traditional identity theft often catch it quickly, victims of medical identity theft may not know they are victims until they need critical medical treatment. In this episode, Scott Ward, CFE, senior vice president at Qlarant, discusses the insidious nature of medical identity theft, the impact it has on its victims and what people and governments can do to help combat it.
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Washington State’s Largest Ponzi Scheme was the catalyst for Tod McDonald, CPA to start his company and push for innovation in financial e-discovery. Years later, he and Garth Leonard, CFE, from Valid8 Financial, join ACFE Community Manager Rihonna Scoggins in the most recent episode of Fraud Talk to explore the current resources at hand to combat fraud and how fraud examiners can assess what tools are the right fit for them in this evolving landscape.
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In this episode, Jim Ducharme, COO of Outseer, a leading technology company in the fight against payment fraud, talks about the rise of "Buy Now, Pay Later" services and how fraudsters are exploiting these new avenues of credit. He also discusses identity assurance and how companies are working to combat payment fraud without adding hurdles for consumers.
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In the fight against fraud, it can be hard to remember why we do it, especially when the fraudsters never seem to quit. Associate professor of accounting, taxation and business law at SUNY Old Westbury, Dr. David Glodstein, began the Justice for Fraud Victims Project to teach his students — and remind fraud examiners — who we're fighting for: the victims. In this episode, join Dr. Glodstein, CFE, and Kate Pospisil, CFE, the Communications Specialist at the ACFE, as they discuss the Justice for Fraud Victims Project, why programs like this matter and what we can do to further the fight for justice.
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In Episode 125 of Fraud Talk, ACFE Training Director Jason Zirkle, CFE, is joined by military veterans from around the world to share their backgrounds and how their experiences have aided them in their roles as CFEs and anti-fraud professionals. Collins Wanderi, CFE, Bill Stakes, CFE, and Monica Meeks, CFE, discuss the tools they’ve gained and advice they offer to veterans and active-duty military members looking to earn their CFE credential.
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Eddie Antar founded the Crazy Eddie electronics retail chain in Brooklyn, New York, which rose to prominence across the New York-New Jersey area throughout the 1970s. Operating undetected for years, Eddie’s business practices were grounded in fraud from the very beginning. In Episode 124 of Fraud Talk, Gary Weiss, author of “Retail Gangster: The Insane, Real-Life Story of Crazy Eddie,” discusses this wide-ranging fraud case and ultimate unraveling with ACFE Chief Training Officer John Gill, J.D., CFE.
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The Justice Department charged 47 defendants on September 20th for allegedly defrauding a federal program that provided food for needy children during the pandemic, describing the scheme — totaling nearly $250 million — as the largest uncovered to date. The charges also underscore that criminals have been quick to take advantage of new programs set up by the U.S. government to curb fallout from the COVID-19 pandemic, and they’re exploiting weaknesses in systems designed to quickly distribute funds.
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“And so we are where we are. Which sucks, and that’s on me,” former FTX CEO Samuel Bankman-Fried said in 22-tweet barrage from his personal Twitter account on November 10. It was the billionaire entrepreneur’s final grasp at redemption. The next morning, the world’s second-largest cryptocurrency exchange announced voluntarily filing for Chapter 11 bankruptcy. Bankman-Fried resigned as CEO and was replaced by insolvency expert John J. Ray III, who oversaw the bankruptcy proceedings of Enron as its CEO.
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With the development of websites such as This Person Does Not Exist, anti-fraud professionals are continuing to see a rise in synthetic identity fraud. Synthetic identity fraud occurs when perpetrators combine piecemeal and, at times, factual information to create a new identity. These identities are cheap, quick and easy to produce, and may include a factual piece, or pieces, of information from sources such as breached data sites.
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In the past year, record numbers of employees have been quitting their jobs, and sometimes leaving entire industries. With so much turmoil in the job market, it comes as no surprise that fraudsters are pouncing. Career scammers are targeting job seekers using LinkedIn to reach out with fake offers and requesting personal information. The message may look like it’s coming from a legitimate company — but its origin is much more sinister. These scammers are attempting to steal your information and money.
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Attention ACFE members, you’re invited to join the Mentoring Program! The ACFE Mentoring Program connects ACFE members to anti-fraud professionals from all over the world who can offer a wealth of resources, experience, advice and guidance. Here are some basics about the program and how it works.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by December 31, 2022. The challenge arms you with study tips and peer support to help you stay motivated and on track to reach your professional goals. Our upcoming challenge starts Saturday, October 1, and ends Saturday, December 31.
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When investigating fraud, it is important that the investigator be able to think clearly and make unbiased decisions. Cognitive bias is when an investigator's own assumptions or beliefs impact their judgment of information and evidence. For example, an investigator may assume that because someone comes from a certain social class or background that they would not commit fraud. An assumption like this may prevent them from looking at other possible explanations for what happened.
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Alexandre De Genaro, CFE, realized he was on the right path when he garnered his first confession during a fraud investigation. After spending time in information security and loss prevention, De Genaro is now the Head of Business Security, Latin America for General Mills.
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Angelica Isgleas Pacheco, CFE, began her career as an auditor for an accounting firm. She found her love for fighting fraud through her career and has excelled due to her passion for her community. This is her story in her own words.
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Diana Muyibi is a graduate student studying at State University of New York (SUNY), Old Westbury and also a proud past recipient of the ACFE’s Ritchie-Jennings Memorial Scholarship. Diana is in the Master of Science in forensic accounting program and is expected to graduate this spring. Currently, she is a member of the Long Island Chapter of the ACFE, the National Association of Black Accountants and the National Society of Collegiate Scholars, and she participates as a volunteer for the Justice for Fraud Victims Project at SUNY Old Westbury along with other programs.
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Michael Mingo-Dabney, CFE, began his career as an anti-fraud professional after learning about the prevalent embezzlement and money laundering corrupting a town in Colombia while serving as a volunteer for the Peace Corps. Michael continues his work against fraud as a fraud analyst for C2 Alaska, as well as serving as a contractor for the Securities and Exchange Commission’s Division of Enforcement.
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Paul McCormack, CFE, began his career in anti-fraud as a forensic accountant and after gaining a wealth of experience, he made the leap and started his own freelance writing business in the fraud and compliance space. Paul has written for countless publications and companies throughout the industry, including Fraud Magazine.
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Ryan Cannon is an undergraduate student studying at the University at Albany and also a proud past recipient of the ACFE’s Ritchie-Jennings Memorial Scholarship. Ryan is pursuing a dual major in Homeland Security and Business Administration.
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Sherene Teo, CFE, began her career in anti-fraud as an auditor in China and after encouragement she applied to become an in-house investigator which helped her gain experience to join her new team at Microsoft. How did you become passionate about fighting fraud? I have worked in China and have witnessed first-hand highly creative fraud practices as an auditor. I was intrigued with the way things were done and it helped build my skepticism and experience as a professional. Born in Malaysia and seeing how Malaysians were affected by the 1MDB saga, it made me realize the importance of the work I do and the impact it has on the community
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ACFE member William Klun spent decades working in the financial industry before setting his sights on fighting fraud. In addition to his drive to seek the truth, he also spends time helping refugees find asylum. Here is his story in his own words.
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The ACFE Mentoring Program connects members to anti-fraud professionals from all over the world who can offer a wealth of resources, experience, advice and guidance. Mentees can search among registered mentors to find individuals whose experience and expertise match the areas in which they wish to be mentored. Caroline Kaye initially reached out to Holly Atkins, CFE, after viewing her mentor profile on the ACFE Community, and since then the pair have been connecting through their personal and professional experience.
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The ACFE Mentoring Program connects members to anti-fraud professionals from all over the world who can offer a wealth of resources, experience, advice and guidance. Mentees can search among registered mentors to find individuals whose experience and expertise match the areas in which they wish to be mentored. Kate Rolan initially reached out to David Harper, CFE, after seeing his experience in law enforcement and investigations on the ACFE Community. This is Kate and David’s mentoring story.
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We get them every day, multiple times a day. Most contain misspelled words that easily reveal the emails are fake. But that’s not the case with all of them. I’ve seen plenty of sham emails and advertisements that look authentic and made me think twice before deleting them. CFEs have a good eye for these scams and can usually spot them quickly. But sometimes the language and graphics are so convincing that they fool even the most skilled observer.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by March 31, 2023.
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While the ongoing war in Ukraine appears to have no end in sight, it is never too early to think about the Foreign Corrupt Practices Act (FCPA) risk landscape in post-war Ukraine, which can come with new and aggravated challenges for FCPA compliance. If every stakeholder is well prepared for potential FCPA risks, not only can Ukraine be saved from compliance-induced delays in its reconstruction efforts, but it can also be set on the right track to become a safe place for investment and development in the long term.
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The ACFE Board of Regents sets standards to promote professionalism and ensure the reputation of the CFE credential. There are two open positions for the 2023-2024 ACFE Board of Regents, and applications to join this illustrious group are now open.
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Classic free-market theory holds that buyers and sellers act as if they are guided by an “invisible hand” that help produce the best outcome — a better outcome than government oversight could ever produce. While economists debate the scope, scale and specific roles for appropriate government intervention, fraud continues. One recent high-profile case is the trial over allegations against a private company, Theranos, founded by Elizabeth Holmes — but this is far from the only case.
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Grab the popcorn, uncork the wine and settle in for a wild ride. Fraudsters and their schemes are having quite a moment in pop culture. We’ve compiled a list of the most popular recent limited series, documentaries and films about fraud that can add context to known cases, illustrate some common fraud schemes and provide insight into the fraudsters at the center of these now infamous frauds. Keep in mind, some of these shows may have taken a few liberties with the details of the cases for entertainment purposes.
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“Corruption exists everywhere,” says Tony Kwok, the former deputy commissioner of the Independent Commission Against Corruption (ICAC), Hong Kong’s ace anti-graft agency. He’s not only right, but sadly corruption remains a major problem. It ranks as the most common occupational fraud scheme on every continent on the globe, according to ACFE’s Occupational Fraud 2022: A Report to the Nations. And the percentage of cases involving corruption is on the rise, jumping from 33% in 2012 to 50% in 2022, the report shows.
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From paper to computer chips, products we once took for granted have become precious commodities as the global supply chain cracks under the weight of labor shortages and renewed demand in the wake of the COVID-19 pandemic. And as every fraud examiner knows, whenever there’s a need for a product or service, fraudsters are there to exploit it for their own gain.
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As investigators, we have all reached the point in the span of our interviews of what can be said or suggested next in support of fraud victims. With all the busy work of report writing, speaking to law enforcement, preparing for court and filing examination findings, we do not always remember the trauma a financial loss can be to the victim. As trained as we are, we may not have experienced fraud in our own lives to understand the emotional impact it can have.
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As experienced fraud examiners know, fraud comes in many varieties, including tales that are truly frightening. These fraudsters were willing to play any type of trick to take their ill-begotten treats. Read on to learn more about this year’s tales of terrifying fraud, but don’t say we didn’t warn you.
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Reality is simply based in fact, whether it be an event or transaction. A fraudster’s movement is a documented reality. Reality, or the truth, is simply confirmed by documentation, digital footprints and verifiable eyewitnesses, which can be pieced together to reveal the factual timeline. This has now become a natural law in a technologically driven society where a person’s movements, swipes, likes, interests and all other relevant personal metadata is collected to identify an individual.
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In September 2021, the IRS published a request for proposal titled, “Development of Exploitation Techniques Against Cryptowallets.” According to supporting documentation, it appears that the digital forensics unit of their Criminal Investigations branch has repeatedly run into scenarios involving the seizure of crypto hardware wallets (also known as cold storage devices) that could not be accessed due to their security features. The growing interest by law enforcement and tax authorities in this issue is long overdue.
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Amid the approval of the post-Covid-19 recovery plan, frugal Netherlands was the loudest voice in the European Council against the EUR 750 billion recovery plan to aid the worst affected countries. The Tax Justice Network reported that, in 2019, the European Union lost USD 10 billion in corporate tax to the Netherlands. But besides its stable political and economic environment, what makes the land of tulips and windmills so attractive to corporate giants such as Starbucks, Google and Amazon?
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Supreme Audit Institutions (SAIs) play an important role in national and global economy by ensuring that public resources are managed properly and in accordance with established rules. They normally produce an audit opinion, which may give opinions about whether the financial statements have been prepared in accordance with the reporting framework. Some SAIs, in addition to performing post-auditing responsibilities, also carry out controller functions of the national treasury--the controller function is a pre-audit function, meaning it is done before the fact.
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The U.S. Department of Justice (DOJ) has brought insider trading charges against Ishan Wahi, a former Coinbase product manager, his brother Nikhil Wahi and friend Sameer Ramani after they allegedly made profits of more than $1 million by buying crypto assets before their listings on the exchange. According to the DOJ, Ishan leaked confidential information regarding assets to be listed on Coinbase as well as the time of the listing’s public announcement to Nikhil and Ramani on at least 14 occasions between June 2021 and April 2022.
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The Association of Certified Fraud Examiners (ACFE) is proud to announce that Thomas Caulfield, CFE, and Natalie Lewis, CFE, have been elected to the 2023–24 ACFE Board of Regents. Fellow Certified Fraud Examiners (CFEs) elected them from candidates selected by the Board's nomination committee. Caulfield and Lewis will take office at the Board's meeting in February.
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The backbone of the Russian economy is energy exports. The Russian energy sector is an enormous global asset driving economic activity across the world. In 2021, Russian crude and condensate output reached 10.5 million barrels per day, making up 14% of the world’s total supply. In the same year, Russia exported oil worth USD 300 billion, accounting for 11% of the global oil trade. The country exports most of its oil production, with almost all going to Europe (about 80%) and Asia (about 20%).
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The European Union Agency for Law Enforcement Cooperation (Europol) was created in 1998 to combat cybercrime, terrorism and other forms of organized crime. Since 2016, Europol has conducted annual anti-money laundering operations known as European Money Mule Actions, or EMMA. On December 2, 2021, Europol announced the results of EMMA 7, which was conducted from September to November 2021 with the cooperation of 26 countries and multiple law enforcement partners, financial institutions and private-sector businesses.
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Whistleblowing is one of the most powerful weapons in the fight against fraud, money laundering and corruption, but the United Kingdom’s approach needs to be reconsidered. Whistleblowing can be a testy subject, but I believe it is potentially one of the most powerful weapons in our anti-money laundering (AML) arsenal. Anyone watching countless cop shows and movies will be all too aware of the value that an insider brings to an investigation. In the U.K., these “snouts,” as they’re called, are treated very differently than their U.S. counterparts. In the U.S., whistleblowers can stand to make a lot of money from their disclosure.
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Two years after the implosion of German financial services provider Wirecard, the story continues to make news. The executives blamed for their roles in the accounting scandal are still fugitives, and just recently, the whistleblower’s identity was revealed. His name is Pav Gill, and the ACFE is honoring his bravery in exposing fraud at Wirecard by presenting him with this year’s Cliff Robertson Sentinel Award, which it bestows annually on a person who, without regard to personal or professional consequences, publicly discloses wrongdoing in business or government.
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If you have the CFE Exam Prep Course, the Prep Toolkit or are planning to get either of the two, we invite you to sign up for the 90-Day CFE Exam Challenge and earn your Certified Fraud Examiner (CFE) credential by June 30. The challenge arms you with study tips and peer support to help you stay motivated and on track to reach your professional goals. Our upcoming challenge starts Friday, April 1, and ends Thursday, June 30.
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It is common these days to sell items we no longer need on online marketplaces such as Craigslist and Facebook Marketplace. It’s easy, local and usually fast. The process is further simplified through the use of peer-to-peer (P2P) payment methods such as Venmo, PayPal and Zelle. However, this ease to buy and sell can attract fraudsters looking to make a quick buck. I personally use Facebook Marketplace frequently and when I recently sold my treadmill, I experienced a scam attempt firsthand.
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In less than a month’s time, the biggest global extravaganza will kick off in Russia. Thirty-two national teams will fight for the top spot in the 2018 Football World Cup. FIFA estimates that more than $5.7 billion in revenue will be generated from the showpiece event, and that more than a million tourists are expected to travel to Russia. This event will indeed be a good time for more than 3.2 billion fans worldwide, but it will also be a potentially lucrative time for fraudsters.
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Basel’s Principles for the Sound Management of Operational Risk defines risk culture as “the combined set of individual and corporate values, attitudes, competencies and behavior that determine a firm’s commitment to and style of operational risk management.” It is no coincidence that — of the 11 principles Basel cites — risk culture is at the core of the very first principle: Strong risk culture is ONLY achievable in concert with strong firm-wide culture.
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There has been no shortage of discussion around the conflict surrounding multiple generations in the workforce. Though much of this has been reactionary and focused on the negative aspects of generations, the tides seem to be turning. More and more companies are talking about the benefits of the various generations they have in their workforce.
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During a recent asset search project, the individual we were looking for initially appeared invisible online. We knew the individual used to be a director of a company, but his name no longer appeared on their website. But, with a little snooping and a bit of luck, we had a physical address (and more) in just a few hours. What did we do to find the information?
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As I sat in the taxi in Jackson, Mississippi, waiting for the cab driver to “call in” my credit card because he had no credit card machine or app on his flip phone, I cringed. Just four days prior, I was teaching an ACFE webinar on travel fraud and here I was, hamstrung by an antiquated process that put my credit card at risk.
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One aspect of fraud examinations that is constantly changing is the use of technology for fraud prevention and detection, with an emphasis on detection. From rules-based systems, fraud analytics and artificial intelligence-based programs, examiners look to increase the effectiveness and efficiency of their work through the use of technology. However, it is critical to the management of fraud risk that examiners focus more of their efforts on the use of data and technology on the mitigation of fraud risk.
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According to the regulation’s detailed website full of helpful tips and background information, the European Union’s (EU) General Data Protection Regulation (GDPR) was designed to harmonize data privacy laws across Europe, to protect and empower all EU citizens data privacy and to reshape the way organizations across the region approach data privacy. But, as i-Sight’s Dawn Lomer recently pointed out, fewer than half of the companies recently surveyed were prepared for the regulation that comes into effect May 25.
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According to an American Psychological Association study titled “The pursuit of personal goals: A motivational approach to well-being and life adjustment,” when your external goals align with your inward aspirations, setting and reaching goals has a positive impact on your well-being.
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The most cost-effective way to limit fraud losses is to prevent fraud from occurring. But, how exactly do you prevent fraud? There isn't a one-size-fits-all approach, as we know, because there isn't one company size, one, single company culture, one type of reporting hotline or one single person within a company who is responsible for all fraud-related efforts.
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There’s more to a job promotion and climbing the career ladder than just simply putting in your time. With more than 15 years of recruiting experience, many of those years recruiting anti-fraud specialists, I’ve heard many instances of disappointment from candidates because they didn’t get that promotion they were expecting.
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Are fraud reporting hotlines worth it? Yes, according to the ACFE’s Report to the Nations, a biennial global study on occupational fraud. For more than a decade, the ACFE’s Report to the Nations has measured the effect of hotlines on generating tips about occupational fraud, and the data has consistently shown that frauds are more likely to be detected by tip when a hotline is in place. While 46% of cases in the report were detected by tip at organizations with a hotline, only 30% of cases were detected by tip in organizations without a hotline.
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Compliance seems to be everyone's business, since, for many firms, it involves managing financial crime, money laundering and cyber risks. This means compliance has to be offensive as well as defensive. Given this increased area of responsibility and scope, here are seven ways to have an effective compliance program.
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Tenecia Strayhorn, CFE, is a data analytics supervisor, who participated in the last 90-Day CFE Exam Challenge. She stayed dedicated to her goal throughout the 90 days, sharing and swapping advice along the way in our challenge group. She passed the exam just before 2018 rolled in, and now she’s got some advice to share with those who’d like to join our next challenge.
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Joanna Kardys-Stone is a CPA whose work focuses mostly on financial statement audits. She began her studies for the CFE Exam at the end of 2017 but got busy and distracted over the holidays. For Joanna, the 90-Day CFE Exam Challenge came at the perfect time for her to recommit to her goal.
Joanna earned her CFE credential in June, and she has some tips and advice to share with anyone else who is considering signing up for the challenge.
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Maureen Molekwa works as a risk mitigation officer at a financial institution in South Africa. She participated in our last 90-Day CFE Exam Challenge and was one of our most active participants in the group, checking in every week, sharing study tips and helping to cheer on fellow challenge participants. Maureen has a few study tips to share if you’re considering joining the 90-Day CFE Exam Challenge.
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There are now more reasons than ever to implement an effective fraud risk management framework for personnel in your organization. The focus on individual responsibility has dramatically altered and employees should now be educated as to the risks and repercussions, especially in the U.S. As a result of the memorandum titled “Individual Accountability for Corporate Wrongdoing” issued by former U.S. Deputy Attorney General (DAG) Sally Yates on September 9, 2015 — even those who merely had knowledge that something wrong was happening but didn’t report it would potentially face penalties.
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If you want to earn your CFE credential within the next three months, then the 90-Day CFE Exam Challenge is exactly what you need to complete your next professional goal. It will start on Monday, April 2, and end on Friday, June 29. Within that time, you will work alongside your fellow associate members to prepare for and take the CFE Exam.
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In the case of Livent, Inc. v. Deloitte & Touche the Ontario Court of Appeal upheld a 2014 decision ordering Deloitte & Touche (Deloitte) pay $118 million in damages to a theater company (Livent, Inc.) for which Deloitte performed auditing services. Why was Deloitte held accountable for such a large sum?
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Dave Cotton, CFE, CPA, chairman at Cotton & Company, LLP, recently collaborated with several members of the ACFE to start a new group* in the ACFE Community dedicated to fraud risk management. In this group, members can discuss how to perform fraud risk assessments, implement best practices and raise fraud risk management awareness in organizations of all sizes and industries.
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With the publication of the 2018 Report to the Nations, I am struck by how this study, like the Association of Certified Fraud Examiners itself, is in many ways a tribute to the vision and dedication of our founder and chairman, Dr. Joseph T. Wells, CFE, CPA. When Dr. Wells created the ACFE, he did so because he recognized there was a fundamental flaw in how organizations were attempting to prevent, detect, and investigate fraud.
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One of the most exciting technological innovations to emerge from the development of cryptocurrencies is blockchain — or distributed ledger — technology. Blockchain is essentially a decentralized ledger or database maintained across a network of computers. Anyone with access to the network can view the database, which is updated across all connected devices, rather than being maintained at a central location.
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According to the ACFE, a lack of effective internal controls are the primary contributing factor in nearly one-third of fraud cases. Why is this? For many companies, the issue stems from the effort it takes to change set processes. Boosting internal controls isn’t difficult, but it does involve taking time to reassess company procedures. For smaller businesses, the challenge often lies in the lack of resources or staff.
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One shared characteristic among fraudsters is creativity. Devising a scheme and then covering one’s tracks requires a certain amount of ingenuity. Sometimes, though, fraudsters take it one step further and venture into the realm of downright weird. Mark Twain said, “Truth is stranger than fiction…” Here are some of the spookiest frauds, so strange that we couldn’t have made them up if we tried.
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Hossam El Shaffei, CFE, has been interested in fighting fraud since first seeing normalized bribery occur in his native Middle East. Currently a partner specializing in risk advisory services at RSM Consulting, he has more than 35 years of global and regional work experience in multinational organizations such as the United Nations and United States Agency for International Development. El Shaffei also established ACFE chapters in Egypt and Jordan and recently became an Authorised Trainer for the CFE Exam Review Course in Jordan, Egypt and Lebanon.
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Shannon Grayer, CFE, CBM, CCEP, may have earned his CFE more than a decade ago, but his passion for learning more about the world and fraud examination has never waned. The head of ethics and compliance investigations for CSRA Inc. has lived in multiple countries, stays abreast of technological advancements in the IT industry and works with major players in U.S. national security.
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“Second Year Syndrome” is the malady of medical students who experience the symptoms of the disease that they are studying at the time. If they’re studying skin cancer, suddenly that zit becomes melanoma. If they’re studying arthritis, their joints start to ache. If they’re studying narcolepsy, they suddenly feel they’re about to fall asleep. (That last might be attributable to being grossly overworked, but you get the idea.)
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Kelly Ohayon, CFE, CPA, CA, and MD of Financial Governance and Controls at BMO Financial Group, will sit on a panel of experts at an upcoming screening of Collared, a new documentary produced with the support of the Fund for Innovation in Law and Media (FILM) established at Osgoode Hall Law School of York University, as well as in partnership with the Hennick Centre for Business and Law. The screening and panel discussion will be at the HotDocs Ted Rogers Cinema, September 20 in Toronto and will offer attendees 2 hours of CPE.
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After attending a fraud prevention seminar more than 30 years ago, Robert Goehring, CFE, knew he wanted to serve and protect his local community. He has been a board member of the Pacific Northwest ACFE Chapter since 2001. He has served on the board in several capacities, including president, where he has been since 2012.
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We recently finished up the April-June 90-Day CFE Exam Challenge. Associate members joined with the intention to prepare for and earn the CFE credential in less than 90 days. We had a great group of participants, and we'd like to celebrate the 99 members who completed the challenge successfully.
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2017 was a year of unprecedented progress for cryptocurrencies. From the Japanese government’s decision to recognize Bitcoin as legal tender to the overall cryptocurrency market cap exceeding $500 billion, it is a safe bet to argue that this revolutionary digital asset class is here to stay. With cryptocurrencies quickly becoming both a speculative investment and payment method, certain names in the space are gaining credibility.
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In today’s world, it’s not uncommon to see headlines about a new instance of fraud many times a week. Whether it’s a new phishing scam targeting seniors or the arrest of a low-level employee embezzling small amounts from a local government office, most fraud-related issues are interesting to the public regardless of their profession. Since anti-fraud professionals are on the front line of fraud prevention and investigation, it’s also predictable that family and friends may turn to you for clarification of these fraud-related stories.
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Dr. Jessica Barker addressed hundreds of anti-fraud professionals yesterday at the 2018 ACFE Fraud Conference Europe and told them that a new weak point in organizations’ cybersecurity might stem from an unlikely source — General Data Protection Regulation (GDPR) compliance. “One of the speculations about what we will see with GDPR is more extortion around hacks,” she said.
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I vividly remember how I felt on my first date. I was 15 years old (now that I have kids, I don’t know what my parents were thinking letting me go), and my body was still catching up to my forehead. My long-time crush of about two weeks drove to pick me up in a black Pontiac Grand Am that had a white Oakley sticker on the back window. He was one year older and was one of the few boys at my school who had a car…that worked.
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As the two most recent Reports to the Nations have indicated, data analytics is one of the most effective anti-fraud controls an organization can use. It’s worth noting, however, that data analytics are also incredibly effective at fraud detection as well. Organizations in all industries, including government, have been implementing analytics for years. According to the Department of Justice’s (DOJ) 2017 Year in Review, they are no different.
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The insurance company Aflac is probably known best for its ubiquitous duck mascot. It is also consistently ranked on Ethisphere magazine’s World’s Most Ethical Company list, and Fortune’s World’s Most Admired Companies and 100 Best Workplaces for Millennials lists. But in the coming months and years, it might also become well-known for fraud and worker abuses.
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A money laundering scandal involving an Estonian branch of Danske Bank, the Danish financial institution, led to the resignation of CEO Thomas Borgen on September 19, but the fallout from what could end up being the largest money laundering scandal in European history is far from over.
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Depositions are grueling. Let’s say you’re an expert witness for the defense. As you walk into the conference room of the plaintiff’s counsel your heart rate ascends, your palms sweat and you reach for a glass of water as you sit at the table. You know what’s coming: incessant, pointed questions from attorneys as you give sworn testimony. You also know that all parties will use your words in court as evidence or as weapons to attack your inconsistencies.
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Bryan Fogel has most likely never performed a ratio analysis on corporate financial statements or testified in court during a fraud trial, but the story he told through the Academy Award-winning documentary, ICARUS, resonates with what we do as fraud examiners.
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Olympus scandal: $1.7 billion. Bernie Madoff’s Ponzi scheme: $65 billion. Enron’s estimated total losses: $74 billion. Occupational frauds committed by owners and executives tend to be extremely costly, but why are they more costly and how do they differ from other types of fraud?
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You don’t have to go at it alone.
We — and your fellow future CFEs — got your back. Sign up for the 90-Day CFE Exam Challenge today and earn your Certified Fraud Examiner (CFE) credential by the end of the year.
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When the term “fraud” is used in conjunction with schools, the first thing that usually comes to mind is, “How much was stolen?” or “Where did our tax dollars really go?” After all, isn’t money the raison d’etre for committing fraud?
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According to the National Health Care Anti-Fraud Association, the U.S. loses tens of billions of dollars each year to health care fraud. Most health care fraud is committed by providers, such as physicians and hospitals, and much of that fraud involves fraudulent billing. This post discusses five common billing schemes, and how to detect and prevent them.
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While many industries have adopted artificial intelligence (AI), mostly in the tech sector, it’s adoption rate in financial services has been relatively slow. Even though AI is far from a pipe dream, 76% of banking CXOs agree that adopting AI will be critical to differentiate in the market, the technology tends to conjure up images of sci-fi movies, with ambitious computers replacing humans. The reality of AI is much more collaborative and effective.
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On Wednesday March 7, Red Granite Pictures, a Los Angeles-based movie production, agreed to pay $60 million to settle a lawsuit brought by the U.S. Department of Justice (DOJ). The suit alleged that the production studio took money associated with the 1MDB scandal — a multibillion dollar corruption and money laundering case that centers around Malaysia.
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At the ACFE Global Fraud Conference this past June in Las Vegas, I had the opportunity to sit down with CFEs or soon-to-be CFEs in the Professional Development Center. Through strategic one-on-one sessions I offered guidance on professional advancement, résumés and cover letters, interviewing tips and techniques, and career changes. While many topics were covered, there wasn’t a single session that didn’t lead to questions about LinkedIn and how to build a better profile.
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The volume, velocity and range of regulatory change actions today are overwhelming. By having a regulatory change management system to track and monitor regulatory change activity, you can provide your executives and regulators with more visibility and a clear outline of what you are doing to minimize compliance risk.
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If you’re looking for a new opportunity in fraud prevention, detection or investigation, you should be aware that it’s a competitive landscape. According to Glassdoor.com, the average number of applicants applying for a job these days is 250. As specialized recruiters for investigative roles, we regularly receive 500 or more applicants for jobs we post.
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We recently recorded a webinar for those of you who are new members and first-time attendees of the upcoming 29th Annual ACFE Global Fraud Conference. In the webinar, ACFE staff shared key insider tips for making the most out of your conference experience.
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We all know this well-worn concept: An organization’s reputation takes years to develop, but it can collapse overnight if it didn’t originally possess integrity from the top down. “It took 160 years for Siemens to build a reputation and only five minutes to ruin it,” said Dr. Andreas Pohlmann, the former chief compliance officer of Siemens, at the 29th Annual ACFE Global Fraud Conference in June. A little ill-gotten profit means nothing if a business has to close its bank accounts when it goes belly up.
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While millennials are more likely to fall victim to fraud than seniors, the financial losses they suffer are less than half of those suffered by seniors — $400 versus $1,092, respectively — with an annual loss by seniors of approximately $3 billion. The reason for the loss discrepancy: the financial stability of many elderly citizens and the types of frauds perpetrated against them.
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What does it take for individuals and teams to perform at the highest levels? Increasingly, researchers and business leaders have found that technical abilities and intelligence (or IQ) are only part of the equation. When IQ is combined with emotional intelligence (EQ) individuals and teams can achieve increased performance.
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Please join us and the Identity Theft Resource Center for our upcoming Twitter chat during International Fraud Awareness Week to discuss the impact of fraud. Fraud Week runs from November 11-17, 2018, and is a global effort to minimize the impact of fraud by promoting anti-fraud awareness and education. Fraud and identity crimes often go beyond the known financial implications and can have emotional, physical and psychological impacts experienced by victims.
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Before beginning his career in bank examination, and later internal audit, Jacob Flournoy wishes he would have done more of one thing: listening. “I was probably told everything I needed to succeed by my trusted advisors. I just wish I had listened more to their advice,” said Flournoy, a CFE, and the Chief Audit Executive at the University of Arkansas System.
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Clare Rewcastle Brown just couldn’t ignore the corruption. “I could see it was a massive and underreported scandal of vast proportions,” Brown says in the cover article of the most recent Fraud Magazine, written by Sarah Hofmann, CFE. “I asked why no one was covering it, and for some time I hoped someone else would. Then I realized all the local people who knew about it felt disempowered.”
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In a new sub-report, we now focus more closely on how occupational fraud impacts organizations in the Asia-Pacific region. This study is based on the 220 cases of occupational fraud from Asia-Pacific countries that were reported in our 2017 Global Fraud Survey. Collectively, these cases, which accounted for 11% of all cases in our global study, caused a median loss of USD 236,000 and lasted a median 18 months before they were detected.
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In a new sub-report, we now focus more closely on how occupational fraud impacts Canada. This study is based on the 82 cases of occupational fraud from Canada that were reported in our 2017 Global Fraud Survey. Collectively, these cases, which accounted for 4% of all cases in our global study, caused a median loss of USD 200,000 and lasted a median 12 months before they were detected.
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In April 2018, the ACFE released the 2018 Report to the Nations, which provided a global analysis of the costs and effects of occupational fraud (i.e., fraud committed against the organization by its own officers, directors, or employees). The report highlighted the tremendous impact occupational fraud has on organizations throughout the world. In a new sub-report, we now focus more closely on how occupational fraud impacts the government sector.
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In a new sub-report, we now focus more closely on how occupational fraud impacts Sub-Saharan Africa. This study is based on the 267 cases of occupational fraud from Sub-Saharan Africa that were reported in our 2017 Global Fraud Survey. Collectively, these cases, which accounted for 13% of all cases in our global study, caused a median loss of USD 90,000 and lasted a median 12 months before they were detected.
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A recent article in The Atlantic discussed how a scientific researcher is leveraging new software to address the issue of fraud in scientific studies. Though typically I focus more on the application of analytics for occupational fraud, this article showcases how unstructured data (data that doesn’t fit nicely into a row/column or tabular format) can be used to identify red flags of fraud.
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As your founder and chairman, it is with both sadness and joy that I am advising you of President James D. Ratley’s retirement next month on his 30th anniversary with the Association of Certified Fraud Examiners (ACFE). Thousands of you have met Jim; he has given countless presentations at events and local chapters while logging millions of miles on several continents.
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Corrupt politicians are a common trope in society, but what's more uncommon is how to spot the red flags of shady dealings. Breakout speaker Michael Schidlow, CFE, CAMS-Audit, head of financial crime risk training and emerging risk advisory at HSBC Bank, took attendees at the 29th Annual ACFE Global Fraud Conference in Las Vegas last month on a ride through the world of political corruption combining pop culture references with infamous real-world examples involving names like Gaddafi and Putin.
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What if you could squeeze your CPE in while on hold with your cable company? Or, while you are watching your child’s soccer game? Maybe during a holiday meal that gets a little too heated? Okay, so those are extreme examples. But, the ACFE’s new nano courses do make it easy to earn CPE on even your busiest of days. Our new courses are 10-minute explorations of specific anti-fraud topics, and offer immediate, 24/7 access and NASBA-approved CPE without committing a lot of time or money.
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Early in her career, Gabriela Coldea, CFE, understood how beneficial networking and volunteering were for her and her community. She has devoted her time tutoring young students, serving on multiple boards and, most recently, volunteering as the chapter president for the Orange County ACFE Chapter.
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International Fraud Awareness Week officially kicks off this Sunday, November 11. As a dedicated time to spread fraud awareness, it’s the perfect opportunity for you to reach out to members in your community to educate them about fraud and what you do as an anti-fraud professional.
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Buoyed by news and social media coverage of online threats and cyberattacks, cybersecurity is all the rage today. Indeed, whether we’re talking about the recent Iranian online assault on worldwide universities or the cyberattack on the city of Atlanta (which shut down Wi-Fi at the world’s busiest airport), cybersecurity is constantly and rightfully in the spotlight.
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While a report prepared by the Risk and Infrastructure Science Center indicates that severe weather — like Hurricanes Harvey and Maria — lead the pack when it comes to causes of power outages in the U.S., Mother Nature is not without rivals. Power grids can go down for a number of reasons beyond natural disasters. They often use aging equipment, are prone to human error and can just malfunction. However, energy hackers are starting to play more of a role in blackouts.
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The ACFE would like to thank all International Fraud Awareness Week Official Supporters, supporting media, bloggers, tweeters and social media posters for their amazing participation in Fraud Week.
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Perhaps the most encouraging and notable piece of RSA’s most recent quarterly report comes in the form of an overall decrease in cyberfraud. The total amount of cyberfraud attacks observed from January 1, 2018 to March 31, 2018, represented a decrease not only from the previous quarter (16.2%) but also from the same quarter of 2017 (8.6%).
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Most of our event speakers instruct from the knowledge they have in specific areas of fraud examination. But Kathe Swanson isn’t trained in law enforcement, auditing or compliance. She’s someone who noticed something wrong and had the guts and determination to shine a light on it.
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The Prevention of Corruption (Amendment) Bill of 2018 brings about a change in a 30 year-old law defining and penalizing corruption in the Indian public system. The newly introduced law aims to provide a more comprehensive definition of bribery. To a country ranking 81 out of the 180 countries on Transparency International’s Corruption Perception Index, and with its complex regulatory procedures and tax systems, it is not uncommon for an organization to encounter an unfavorable situation with a public official.
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Following a Supreme Court decision on May 14 that will allow states to determine the legality of sports gambling within their jurisdictions, more questions than answers emerged about the ruling’s implications across the country. As individual states determine whether or how they will accommodate sports gambling, fraud risks related to the industry should be at or near the top of the list of considerations for all involved.
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During the last year, whistleblowers were frequently featured in international media. News agencies covered exposures of wrongdoings, such as the Panama Papers, #metoo and LuxLeaks. There is an increasing recognition of the value of whistleblowing as a means of addressing misconduct. Also, a growing number of countries are putting legislation in place aimed at protecting whistleblowers. For example, the European Commission proposed a new law this year to strengthen whistleblower protection across the EU.
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In 2003, the ACFE awarded its first Sentinel Award to its namesake, Oscar-winning actor Cliff Robertson, “For Choosing Truth Over Self.” Robertson, known as “The Whistleblower of Hollywood,” courageously exposed and pressed for the investigation of the then- head of Columbia Pictures for check forgery.
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“The name of the game — moving the money from your client’s pocket to your pocket,” said actor Matthew McConaughey, playing fraudster Mark Hannah in the Hollywood blockbuster The Wolf of Wall Street. The irony of this quote is not lost on the people of Malaysia.
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Tim Harvey, CFE, head of global chapter development for the ACFE, recently shared a story with me about a networking event he held for the U.K. Chapter called "Find a Fraudster." The objective of the event was to move around the room and network with as many people as possible all the while trying to identify a fraudster in the room.
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Today, March 8, the ACFE is proud to recognize our more than 30,000 female anti-fraud professionals in honor of International Women's Day. We created a page on our website to share articles, resources and profiles of the women dedicating their time to fighting fraud. I also wanted to share a few of the quotes and stories we heard from women over the past year.
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We recently co-hosted #FraudWeekChat (a Twitter chat) with the Identity Theft Resource Center in support of International Fraud Awareness Week. Participants who joined the chat took the opportunity to discuss the impact of fraud and identity theft. So much great advice and wisdom were shared, along with countless resources. Not to mention, everyone brought their best gifs to the party.
If you didn’t get a chance to join our Twitter chat this year, here are some of the top insights shared during the chat.
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As the month of December progresses steadily towards the end of the year, many CFEs around the world are busy focusing on end of the year activities and holiday preparations. With all of the hustle and bustle, it is easy to forget that CFEs have an important duty they must also complete before December 31: voting for the 2019-2020 Board of Regents.
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Data breaches and identity theft continue to impact both businesses and consumers significantly. This year alone (as of November 2, 2018), there have been 1,027 data breaches which exposed over 57,667,911 million records. The Federal Trade Commission (FTC) also reported in their March 2018 Consumer Sentinel Network Data Book that they received 1.1 million reports of fraud and 371,000 reports of identity theft in 2017.
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Whether donating to a natural disaster fund, a Go Fund Me page or even giving to an organization you know well, there is always a risk for fraud. During this year’s Charity Fraud Awareness Week, happening October 22-26, we would like to offer some of the best tips we have come across over the past few years in regards to charity fraud.
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Angie Kennard felt that something was off with her 79-year-old father. When they talked on the phone he would tell her about a woman he met online and occasionally sent money to. Even though her father never met the woman in person, she professed her love for him through emails and asked him to send her money to feed her and her daughter. Angie told her father that he was being conned, but he would not listen and continued to send the woman money.
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An act of fraud rarely occurs without subsequent acts to hide it. In the time after a fraud takes place, perpetrators are working in multiple ways to either circumvent controls or take advantage of a lack of controls.
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The Securities and Exchange Commission (SEC) charged Theranos, a Silicon Valley company founded on supposedly revolutionary, portable blood testing technology, its founder and CEO Elizabeth Holmes, and its former President Ramesh Balwani with fraud this week related to false statements and representations made while raising more than $700 million from investors.
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If you follow fraud stories in the news, there’s a chance one or two of them might have caught your attention last week. Although the circumstances of each case differ, they all involve politically active defendants who either pleaded guilty to, were found guilty of, or charged with committing fraud. The cases also illustrate the interconnected nature of many fraud charges.
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As of April 2018, the global population is 7.6 billion and 4.2 billion of us reportedly use the internet. There are 3.3 billion active social media users, which means that 70% of people using the internet also have one or more social media accounts. This number is expected to increase to 90% in the next three years. As a fraud analytics professional, this tells me the majority of people who have access to the internet may also be trackable on social media.
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If you see a weather forecast that a blizzard or big storm is coming, you would most likely rush to stock up on food, water and other necessities. Similarly, if you knew fraudsters were targeting your organization, you would no doubt try to anticipate their actions and prepare accordingly.
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A man and a woman walk up to an ATM located in the back of a small drug store. The machine is tucked away in a seating area for people waiting on prescriptions to be filled. They are dressed as ATM technicians and even have a company logo over the shirt pockets of their uniforms. The man carries a small toolbox, while the woman holds a clipboard.
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When it comes to identity crimes, synthetic identity theft is a serious issue not only because it’s growing, but also because it’s a complicated threat that is sometimes hard to spot and correct.
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The business sector tops the Identity Theft Resource Center’s industry facing the most data breaches for the sixth consecutive month. This time, it’s because of the massive Marriott International and Starwood Hotels and Resorts data breach that affected more than 500 million customers.
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Anti-fraud professionals know just how devastating a fraud can be to its victims. But they are not the only ones who benefit from insight into the amount of damage that fraud causes organizations and their stakeholders, as shown in the ACFE's 2018 Report to the Nations.
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As the world witnesses a surge in fraud incidents, leveraging artificial intelligence (AI) for fraud detection could be the key to saving millions of dollars in financial fraud losses. Organizations worldwide are increasing their investment in AI-based fraud detection solutions, indicating that the industry is bullish on the capabilities of AI in fraud.
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A measure approved last week by the House Financial Services Committee to change Sarbanes-Oxley audit rules would lead to a higher incidence of fraud and an increase in the amount of fraud losses, according to the Association of Certified Fraud Examiners (ACFE).
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The Criminal Investigation Division of the Internal Revenue Service (IRS-CI) recently joined the ACFE Law Enforcement Partnership by officially recognizing the Certified Fraud Examiner (CFE) credential for hiring and promotional purposes.
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The Association of Certified Fraud Examiners (ACFE) presented its annual Cliff Robertson Sentinel Award Wednesday to Pamela Davis, CEO of Edward Hospital in near Chicago, at the 20th Annual ACFE Fraud Conference & Exhibition in Las Vegas.
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The ACFE is hosting its 20th Annual Fraud Conference & Exhibition in Las Vegas, where more than 2,000 attendees will hear keynote speakers including Madoff whistleblower Harry Markopolos, CFE, CFA and second U.S. Secretary of Homeland Security Michael Chertoff at the largest gathering of anti-fraud professionals in the world.
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Well-meaning victims, courts, the media and the public actually believe that Bernard Madoff, sentenced recently to a record 150 years in prison, stole 65 billion dollars. Not hardly — not even close.
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Intense financial pressure during the economic crisis has led to an increase of fraud, according to a survey of fraud experts conducted by the Association of Certified Fraud Examiners (ACFE).
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The median fraud loss for organizations in Canada is about 127,000 CAD, according to a fraud survey conducted by the Association of Certified Fraud Examiners (ACFE) last year.
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Anti-fraud professionals will gather in Singapore for expert training and professional networking at the 2011 ACFE Asia-Pacific Fraud Conference, 23-25 October at Marina Bay Sands hotel and resort.
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U.S. Attorney General Lanny Breuer was among the distinguished keynote speakers who recognized the fraud-fighting efforts of more than 2,300 professionals in attendance at the 22nd Annual ACFE Fraud Conference and Exhibition.
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More than 2,300 professional fraud sleuths descended upon the San Diego Convention Center Sunday for the week-long 22nd Annual ACFE Fraud Conference & Exhibition.
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The impact of fraud on business in Europe will be on the minds of nearly 150 anti-fraud professionals when they meet at the 2011 ACFE European Fraud Conference next week, 17-19 April 2011, in Brussels.
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The Association of Certified Fraud Examiners (ACFE), the world's largest anti-fraud organization and premier provider of anti-fraud training and education, has announced that Johnnie R. Bejarano, DBA, CFE, CPA, and E. Wendell Hopewell, MBA, CFE, CPA, have been elected to the ACFE Board of Regents.
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Increased financial pressure is the leading reason fraud takes an estimated 20% uptick during the U.S. holiday season, according to a new survey of Certified Fraud Examiners (CFEs). A majority of these experts believe employee embezzlement is the type of fraud most likely to increase during this period.
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Red flags of fraud, detecting deception, conducting online investigations and other trending topics will be top discussion items when anti-fraud professionals from across Europe convene on 17-19 March 2013 at the ACFE European Fraud Conference in Prague.
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Nearly 250 professional fraud fighters from around Canada arrived at the Ottawa Marriott Sunday to share best practices in fraud prevention and detection at the 2012 ACFE Canadian Fraud Conference. The largest anti-fraud event in the country kicked off with a pre-conference session on conducting internal investigations, and the main conference continues today through Wednesday.
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Professional fraud fighters from around the Asia-Pacific region will gather for training and to share best practices in fraud prevention and detection at the 2012 ACFE Asia-Pacific Fraud Conference, 4-6 Nov. 2012 in Hong Kong.
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James D. (Jim) Ratley, CFE, president and CEO of the Association of Certified Fraud Examiners (ACFE), has been selected by Accounting Today as One of the Top 100 Most Influential People of 2012. The exclusive list includes President Barack Obama, Mitt Romney, SEC Chair Mary Shapiro and other dignitaries and business leaders.
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More than 2,300 professional fraud sleuths will arrive here Sunday for the 23rd Annual ACFE Fraud Conference & Exhibition, June 17-22, 2012. The world’s largest gathering of anti-fraud professionals will take place at the Gaylord Palms Resort and Convention Center.
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Organizations around the world lose an estimated five% of their annual revenues to fraud, according to a survey of Certified Fraud Examiners (CFEs) who investigated cases between January 2010 and December 2011. Applied to the estimated 2011 Gross World Product, this figure translates to a potential total fraud loss of more than $3.5 trillion.
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For “choosing truth over self” in exposing the Olympus accounting scandal, Michael Woodford has been selected to receive the Association of Certified Fraud Examiners’ (ACFE) Cliff Robertson Sentinel Award for 2012.
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Anti-fraud professionals from across Europe will convene for training and discussion of the hottest fraud topics in the region when they meet on 25-27 March at the 2012 ACFE European Fraud Conference in London.
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With increased financial pressure causing fraud to rise an estimated 20% during the U.S. holiday shopping season, the Association of Certified Fraud Examiners (ACFE) reminds business owners and management to take a preventive stance to lower their risk.
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Two years after the world’s largest anti-fraud association held its Asia-Pacific Fraud Conference in Singapore for the first time, anti-fraud professionals are preparing to gather again in a country commonly considered a model for keeping fraud and corruption in check.
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The Association of Certified Fraud Examiners (ACFE) has announced a partnership with Airbus to provide ethics and compliance training and certification among its employees.
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For the second year in a row, James D. (Jim) Ratley, CFE, president and CEO of the Association of Certified Fraud Examiners (ACFE), has been selected by Accounting Today as “One of the Top 100 Most Influential People.” The annual list includes business leaders, government figures and luminaries who are “shaping the profession now and in the future.”
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Raiffeisen Bank International AG (RBI), a leading European universal banking group, has announced a partnership with the Association of Certified Fraud Examiners (ACFE) to increase anti-fraud knowledge and certification among its employees.
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Hundreds of professional fraud fighters from around Canada will gather Sept. 8-11, 2013 in Montreal to share best practices in fraud prevention and detection at the 2013 Association of Certified Fraud Examiner’s (ACFE) Canadian Fraud Conference. Data analytics, open-source intelligence and new laws and regulations are among the timely fraud training issues on the agenda.
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Internal Auditor magazine has announced that Dr. Joseph T. Wells, CFE, CPA, founder and chairman of the Association of Certified Fraud Examiners (ACFE), has been named 2013 Outstanding Contributor for his April 2012 article “Inside the Fraudster's Mind.”
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More than 2,600 anti-fraud professionals have gathered at the ARIA Resort & Casino here for the 24th Annual ACFE Global Fraud Conference, setting record attendance for an event that is the largest of its kind in the world.
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The Association of Certified Fraud Examiners (ACFE) announced today its selection of Allan Dodds Frank as the recipient of its 2013 Guardian Award, bestowed annually on a journalist whose “determination, perseverance, and commitment to the truth have contributed significantly to the fight against fraud.”
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The Association of Certified Fraud Examiners (ACFE), the world’s largest anti-fraud organization and premier provider of anti-fraud training and education, has announced that Richard G. Brody, Ph.D., CFE, CPA, and Bruce G. Dubinsky, M.S., CFE, CPA, have been elected to the ACFE Board of Regents.
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Preet Bharara, U.S. Attorney for the Southern District of New York, ex-Enron CFO Andrew Fastow and award-winning actor Stacy Keach head the list of keynote speakers for the 24th Annual Association of Certified Fraud Examiners’ (ACFE) Global Fraud Conference, June 23-28, 2013 at ARIA Resort & Casino in Las Vegas.
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As technology continues to advance, criminals come up with ways to exploit it just as quickly.
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The 2018 ACFE Report to the Nations on Occupational Fraud and Abuse showed that the leading detection method for fraud was through tips.
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Academy Award® Winner Bryan Fogel, the director and writer of ICARUS, Clare Rewcastle Brown, the investigative journalist who helped bring the international 1MDB scandal to light and other experts will address more than 3,000 anti-fraud professionals gathering this week for the 29th Annual ACFE Global Fraud Conference.
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Over the past decade, fewer and fewer fraud cases were referred to law enforcement.
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Dr. Jessica Barker addressed hundreds of anti-fraud professionals today at the 2018 ACFE Fraud Conference Europe and told them that a new weak point in organizations’ cybersecurity might stem from an unlikely source — General Data Protection Regulation (GDPR) compliance.
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The Association of Certified Fraud Examiners (ACFE) and the Abu Dhabi Accountability Authority (ADAA) have joined hands to assert ADAA’s Knowledge Center as an ACFE Authorized Knowledge Center, marking a major milestone in ADAA’s efforts to provide professional advanced training and support to Abu Dhabi government entities and employees.
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The Association of Certified Fraud Examiners (ACFE) announced today that Bruce Dorris, J.D., CFE, CPA, has been named the incoming president and CEO.
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With the widespread distribution of COVID vaccines now promising hope for a “return to normal,” business leaders need to understand that some of the changes in the business landscape are not temporary — and these changes will have a big impact on their organizations’ fraud risk.
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Cybersecurity expert Robert Herjavec and former U.S. Attorney of the Southern District of New York Preet Bharara will address 5,000 anti-fraud professionals at the virtual 32nd Annual ACFE Global Fraud Conference on June 21-23.
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According to the ACFE’s latest report, the Fraud Awareness Training Benchmarking Report, 14% of respondents said board members receive no fraud training.
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The Association of Certified Fraud Examiners (ACFE), in collaboration with the Capital Market Authority of Saudi Arabia, will host the 2021 ACFE Fraud Conference Middle East in a virtual format, 7-8 April.
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Award-winning journalist, broadcaster and author Misha Glenny says that ransomware should be the top concern of European organizations — and that they’re not prepared.
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Paul Kilby, an editor and journalist with more than two decades of experience, will replace Dick Carozza, CFE, who's retiring as the editor-in-chief of the ACFE’s flagship publication Fraud Magazine.
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Hundreds of organizations, such as Walmart, Microsoft and Nationwide, have pledged their support to spread fraud awareness during International Fraud Awareness Week (Fraud Week), November 17-23, 2019.
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In a new report from the Association of Certified Fraud Examiners (ACFE), 58% of anti-fraud professionals say their organizations currently have inadequate levels of anti-fraud staffing and resources.
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Dubai's General Directorate of Residency and Foreigners Affairs (GDRFA) has signed a Memorandum of Understanding (MoU) with the Association of Certified Fraud Examiners (ACFE) to host the 2020 ACFE Fraud Conference Middle East.
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“In almost four decades of security work, I have never witnessed a threat environment that has this type of volume, velocity and variety,” security expert Ray Boisvert told the Association of Certified Fraud Examiners (ACFE).
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Although the 1MDB scandal first came to light in 2015, the effects are still being felt in the Asia-Pacific region today.
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While only 13% of organizations use artificial intelligence (AI) and machine learning to detect and deter fraud, another 25% plan to adopt such technologies in the next year or two – a nearly 200% increase.
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Theranos Whistleblower Tyler Shultz, U.K. Serious Fraud Office (SFO) Director Lisa Osofsky, cybersecurity expert Theresa Payton, Kremlin critic Bill Browder and other experts will address more than 3,400 anti-fraud professionals gathering this week for the sold out 30th Annual ACFE Global Fraud Conference.
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Gretta Fenner, managing director of the Basel Institute on Governance, addressed more than 300 anti-fraud professionals today in Zurich at the 2019 ACFE Fraud Conference Europe to discuss the state of anti-money laundering in Europe.
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The region’s most important event dedicated to both analyzing and preventing fraud and malpractice began Sunday with the opening of the 2019 ACFE Fraud Conference Middle East.
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James D. Ratley, CFE, president of the Association of Certified Fraud Examiners (ACFE) has been selected as one of Security magazine's Most Influential Security Executives for 2010.
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The Association of Certified Fraud Examiners (ACFE) will host its 21st Annual Fraud Conference & Exhibition, July 25-30, 2010 at Gaylord National Hotel in Washington, D.C., headlined by keynote speakers including Special Inspector General Neil M. Barofsky, overseer of the Troubled Asset Relief Program (TARP), and court-appointed Madoff trustee Irving Picard.
Published in Press Releases
Organizations around the world lose an estimated 5% of their annual revenues to fraud, according to a survey of Certified Fraud Examiners (CFEs) who investigated cases between January 2008 and December 2009.
Published in Press Releases
With seasonal hiring in the U.S. expected to be at its highest level in years, fraud experts warn that companies that loosen their usual processes in order to add staff quickly put themselves at increased risk to fraud.
Published in Press Releases
Brian Krebs, the investigative reporter behind KrebsOnSecurity who exposed massive data breaches, cybercriminals and the service providers who catered to them, has been selected to receive the Association of Certified Fraud Examiners (ACFE) Guardian Award.
Published in Press Releases
For the third year in a row, James D. (Jim) Ratley, CFE, president and CEO of the Association of Certified Fraud Examiners (ACFE), has been selected by Accounting Today as “One of the Top 100 Most Influential People.”
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Woodford will tell his story and reflect on the current state of corruption and fraud in business in his keynote address at the 2014 ACFE Asia-Pacific Fraud Conference, November 16-18, 2014 in Hong Kong.
Published in Press Releases
Hundreds of professional fraud fighters from around Canada will gather next month at Toronto Marriott Downtown Eaton Centre to share best practices in fraud prevention and detection at the 2014 ACFE Canadian Fraud Conference, September 7-10, 2014.
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FBI Director Louis J. Freeh, Transparency International founder Peter Eigen and other experts will address nearly 3,000 anti-fraud professionals gathering here this week for the 25th Annual Association of Certified Fraud Examiners (ACFE) Global Fraud Conference.
Published in Press Releases
Organizations around the world lose an estimated 5% of their annual revenues to occupational fraud, according to a survey of Certified Fraud Examiners (CFEs) who investigated cases between January 2012 and December 2013.
Published in Press Releases
The Association of Certified Fraud Examiners (ACFE), the world’s largest anti-fraud organization and premier provider of anti-fraud training and education, has announced that Bruce G. Dubinsky, M.S., CFE, CPA, has been named chairman of the ACFE Board of Regents.
Published in Press Releases
For the first time since the original report was published in 1996, the ACFE Report to the Nations on Occupational Fraud and Abuse has been translated into Arabic thanks to the efforts of the ACFE Saudi Arabia Chapter, with support from Saudi Aramco.
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The Association of Certified Fraud Examiner’s (ACFE) first-ever Law Enforcement Government Anti-Fraud Summit will be November 21 in Washington, D.C., at the Hyatt Regency Washington on Capitol Hill.
Published in Press Releases
According to the 2016 ACFE Report to the Nations on Occupational Fraud and Abuse, organizations across the globe lose an average of $150,000 each time they fall victim to fraud and an estimated 5% of their revenues annually.
Published in Press Releases
“I think this whole offshore financial structure that’s been allowed to grow like a canker … the whole thing’s got out of control,” said investigative journalist Clare Rewcastle Brown in an interview with the Association of Certified Fraud Examiners (ACFE).
Published in Press Releases
The Committee of Sponsoring Organizations of the Treadway Commission (COSO) announced today the release of the Fraud Risk Management Guide, a new research report that offers a blueprint for helping organizations to establish an overall fraud risk-management program.
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According to the Association of Certified Fraud Examiner’s (ACFE) latest report, Canadian fraudsters were more likely to receive no punishment from their employers than being asked to resign.
Published in Press Releases
Academy Award-Winning Actor Richard Dreyfuss, Judge Jed S. Rakoff, New York Times investigative journalist David Barboza and other experts will address more than 3,000 anti-fraud professionals gathering for the 27th Annual Association of Certified Fraud Examiners (ACFE) Global Fraud Conference in Las Vegas, June 12-17.
Published in Press Releases
“Waste, fraud and abuse” has become a pervasive soundbite in the 2016 U.S. presidential election, but just how much fraud is actually occurring in the government?
Published in Press Releases
When hundreds of anti-fraud professionals from Europe gather in Brussels on March 20-22 for the 2016 ACFE European Fraud Conference, president and founder of TRACE International, Alexandra Wrage, hopes that she can shed some light on corruption and compliance issues around the world, including those affecting football’s governing body.
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The Association of Certified Fraud Examiners (ACFE) have signed a Corporate Alliance agreement with Saudi Aramco which will allow selected Saudi Aramco employees to benefit through full ACFE membership, along with exclusive on-site training opportunities, discounted ACFE conferences and seminars, self-study courses, free quarterly webinars and access to the ACFE network of fraud examiner practitioners.
Published in Press Releases
In conjunction with their annual International Fraud Awareness Week, November 12-18, 2017, the Association of Certified Fraud Examiners (ACFE) has offered up two videos explaining why people commit fraud, and what common traits fraudsters possess.
Published in Press Releases
In the Association of Certified Fraud Examiner’s (ACFE) In-House Fraud Investigation Teams: 2017 Benchmarking Report, fraud investigation teams said the top skills they are currently seeking or expecting to add are digital forensic skills and cybersecurity skills.
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The largest gathering of anti-fraud professionals from the Asia-Pacific region will take place in Hong Kong this autumn at the 2017 ACFE Fraud Conference Asia-Pacific. The conference will be held 17-19 September at the Kowloon Shangri-La Hong Kong, and feature sessions and speeches from leaders in the compliance and cybercrime industry.
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Dr. Sam Foote, the whistleblower who brought the U.S. Veterans Affairs (VA) scandal to light in 2014, will be awarded the ACFE Sentinel Award at the 28th Annual ACFE Global Fraud Conference in Nashville, June 18-23.
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Former Director of FinCEN Jennifer Shasky Calvery, investigative journalist Andrew Jennings, former FBI agent Eric O’Neill and other experts will address more than 3,000 anti-fraud professionals gathering for the 28th Annual Association of Certified Fraud Examiners (ACFE) Global Fraud Conference in Nashville, June 18-23.
Published in Press Releases
It's unfortunately common this time of year for individuals to file their taxes only to find out that someone has already claimed their return. This type of identity theft can be upsetting, but it may be even more upsetting if they found out their identity was stolen not through a fault of their own, but due to their employer falling victim to a scam.
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The Association of Certified Fraud Examiners (ACFE), the world’s largest anti-fraud organization and premier provider of anti-fraud training and education, has announced that Leah D. Lane, CFE, has been named chairman of the 2017-2018 ACFE Board of Regents.
Published in Press Releases
Famous for her work investigating and exposing the large and complex 1MDB scandal, Clare Rewcastle Brown believes that European banks should be considered partially culpable for the Malaysian-based fraud. Scheduled to address hundreds of anti-fraud professionals in London, 19-21 March, for the 2017 ACFE Fraud Conference Europe, Brown says that international bodies around the world could do more to investigate and prosecute fraud.
Published in Press Releases
The founder and former president of the World Anti-Doping Agency (WADA), Dick Pound, has spent decades battling corruption and bribery within the International Olympic Committee.
Published in Press Releases
Carson Block, the founder and chief investment officer of Muddy Waters Capital LLC, made headlines at the beginning of 2020 when he posted a report to Twitter accusing Chinese coffee company Luckin Coffee Inc. of fraudulently inflating sales.
Published in Press Releases
Danske Bank whistleblower Howard Wilkinson, security expert Jules Kroll, WIRED magazine Editor-in-Chief Nicholas Thompson and other experts will address thousands of anti-fraud professionals, June 22-24, at the virtual 31st Annual ACFE Global Fraud Conference.
Published in Press Releases
According to a new report from the Association of Certified Fraud Examiners (ACFE), a single case of occupational fraud costs the victim organization an average of more than $1.5 million, and Certified Fraud Examiners (CFEs) estimate that organizations lose 5% of their revenues each year to fraud.
Published in Press Releases
If you have lived long enough, you have been affected by some unforeseen calamity.
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Under the patronage of His Highness Sheikh Maktoum bin Mohammed bin Rashid Al Maktoum, Deputy Ruler of Dubai, the General Directorate of Residency and Foreigners Affairs (GDRFA-Dubai) along with the Association of Certified Fraud Examiners (ACFE) will host the 2020 ACFE Fraud Conference Middle East in Dubai 23-25 February.
Published in Press Releases
Documented allegations of fraud against Madoff Investment Securities, LLC were presented to the Securities Exchange Commission as early as 1999 by Harry Markopolos, a Certified Fraud Examiner.
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The Office of the Inspector General (OIG) for the National Reconnaissance Office (NRO) recently announced its official recognition of the Certified Fraud Examiner (CFE) credential for hiring and promotional purposes.
Published in Press Releases
U.S. organizations lose an estimated seven percent of their annual revenues to fraud, according to a survey of Certified Fraud Examiners who investigated cases between January 2006 and February 2008.
Published in Press Releases
The Association of Certified Fraud Examiners (ACFE) will be hosting its 19th Annual Fraud Conference & Exhibition on July 13-18, 2008 in Boston, featuring an opening keynote address by Senator George Mitchell.
Published in Press Releases
The Office of the Inspector General (OIG) for the U.S. Department of the Interior (DOI) recently recognized the Certified Fraud Examiner (CFE) credential for hiring and promotional purposes.
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Published in Press Releases
A case involving Texas Supreme Court Justice David Medina, a Harris County Grand Jury, and the Harris County District Attorney is raising a debate as to whether politics or a lack of evidence played a role in the dismissal of indictments.
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More than 300 anti-fraud professionals will gather at Atlantis, the Palm in Dubai on February 14-15, 2016 to discuss emerging issues in fraud prevention and listen to leaders in the anti-fraud field.
Published in Press Releases
More than 250 anti-fraud professionals from around the Asia-Pacific region will gather for the 2015 Association of Certified Fraud Examiners (ACFE) Asia-Pacific Fraud Conference at Marina Bay Sands in Singapore, November 4-6, to listen to leaders in the anti-fraud field, along with an unlikely special guest: a convicted fraudster.
Published in Press Releases
Cybersecurity expert Brian Krebs, Leslie R. Caldwell, U.S. Department of Justice assistant attorney general, Criminal Division, and other experts will address more than 3,000 anti-fraud professionals gathering here this week for the 26th Annual Association of Certified Fraud Examiners (ACFE) Global Fraud Conference.
Published in Press Releases
K & N Kenanga Holdings Berhad (Kenanga Group), the holding company of the largest independent investment bank in Malaysia*, Kenanga Investment Bank Berhad (KIBB), is the first Southeast Asian organisation to partner with the Association of Certified Fraud Examiners (ACFE), the world’s largest anti-fraud organisation.
Published in Press Releases
Your social security number could be the ticket for a fraudster seeking to claim a false tax refund or worse, according to the Internal Revenue Service (IRS). A fraud expert offers some tips for preventing such crime – or at least catching it early.
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The Financial Audit Department (FAD) – Dubai Government announced Thursday a partnership with the Association of Certified Fraud Examiners (ACFE), the world’s largest anti-fraud organization, to provide expert fraud training and certification for FAD employees.
Published in Press Releases
Brief Video Description shows on list page and also the main video landing page
Published in ACFE Video Library
This is a sample Description for the Podcast Article - TEST SOP
Published in Fraud Talk Podcast
Most of us know it’s more “blessed to give than receive,” but hectic work and family schedules (and pesky pandemic problems) can keep us from imparting our knowledge. But don’t let lofty assumptions of mentorship keep you from the joy of giving newish fraud examiners the career boosts they need. Here are practical ways to get started.
Published in Fraud Magazine
The U.S. Congress has approved a record $5 trillion in aid packages so far to help Americans survive the pandemic, opening up new territory for fraudsters to ply their trade. Fraud Magazine talks to two of the top professionals leading the government’s fight against fraud and finds out why CFEs are required more than ever.
Published in Fraud Magazine
Insider-fraud risks are on the rise as the economic and psychological fallout from the COVID-19 pandemic takes its toll on organizations and their employees. Understanding these risks and knowing how to manage them will be an important part of many CFEs’ jobs.
Published in Fraud Magazine
Published in Fraud Magazine
SIGPR, the U.S. office mandated to audit and investigate fraud and abuse of the $2 trillion COVID-19 aid package known as the CARES Act, is now ready to take on the task at hand. It could be a busy few years ahead.
Published in Fraud Magazine
At the height of the COVID-19 pandemic last June, the ACFE pivoted the ACFE Global Fraud Conference to a virtual format to keep attendees, speakers and sponsors safe. The ACFE stood firm in its commitment to provide quality education and resources for anti-fraud professionals, and it delivered. More than 4,000 fraud fighters gathered virtually in a breakthrough format to share knowledge, network with like-minded professionals and learn from the industry’s top leaders.
Published in Fraud Magazine
In some of the first COVID-19 articles Fraud Magazine published nearly a year ago, we warned how the pandemic was creating the perfect storm for fraudulent activity to thrive. Sadly, those predictions have proven true as record amounts of COVID-relief money flood the economy.
Published in Fraud Magazine
Arpinder Singh, CFE, got his start investigating fraud when he discovered the field of forensic accountancy just as India’s economy took off following sweeping reforms in the early 1990s. Forensics proved to be an excellent career choice as corporate India increasingly focused on governance issues, including fraud detection and prevention.
Published in Fraud Magazine
The U.S. Sarbanes-Oxley Act of 2002 mandated strict reforms to existing securities regulations and imposed tough new penalties on lawbreakers. The U.K. might soon adopt similar legislation, which could significantly change board responsibility for fraud risk management and increase demand for anti-fraud professionals.
Published in Fraud Magazine
When employment circumstances change and pressures mount, criminals might disguise red flags of misbehavior. Because past actions can be a useful indicator of future behavior, background checks provide a snapshot of an applicant’s criminal, credit and employment history. Here we discuss the importance of background checks and how to properly vet your applicants.
Published in Fraud Magazine
If 2020 wasn’t bad enough, some experts believe the COVID-19 pandemic is creating the perfect conditions for an increase in Ponzi schemes. Here’s some advice on how best to deal with this type of fraud and why these schemes persist.
Published in Fraud Magazine
Most medical office practices trust their employees to handle daily financial matters. But what do they do when they catch long-term, trusted employees stealing? Here’s information you can use if you might be looking for medical-practice fraud detection and prevention business, and want to help doctors mitigate losses and claim restitution.
Published in Fraud Magazine
Unusual circumstances open opportunities for fraudsters, and 2021 is no exception. Not only has an uptick in online tax filings during the pandemic spurred new ways to cheat Americans out of their refunds, but utility scams related to winter deep-freezes are on the rise. Here’s what you should do to protect yourself.
Published in Fraud Magazine
Investigators and auditors spend hours looking for fraud and abuse but often overlook the third bad boy: waste. Fraud is flashy, and abuse is sinister. But waste often gets a short shrift. These CFEs encourage us to look for waste so we can save our organizations millions during these lean times.
Published in Fraud Magazine
In August, the FBI began investigating a ransomware attack that struck 23 small local governments in Texas. Within these mostly rural municipalities, inhabitants have been unable to access birth and death certificates online, pay utility bills or engage in any city business or financial operations.
Published in Fraud Magazine
When ACFE Founder and Chairman Dr. Joseph T. Wells, CFE, CPA, stepped up to the podium at the 30th Annual ACFE Global Fraud Conference in Austin in June, the ACFE’s accumulated history accompanied him. As he accepted his induction into the ACFE Hall of Fame, he received it as a representative of the thousands who, but for his foresight, probably never would’ve received fraud examination education and skills.
Published in Fraud Magazine
In this ACFE News article, Fraud Magazine discusses how voting for the new Board of Regents begins in November, the Ritchie-Jennings Memorial Scholarship Program is accepting applications, Mary Sue Smith, a member of the ACFE since 2004, died June 13, and the Board of Regents expelled two members.
Published in Fraud Magazine
During an interview at the 30th Annual ACFE Global Fraud Conference, the Board of Regents opined on how to change corporate cultures, new corporate compliance guidance, ethics vs. profits and more.
Published in Fraud Magazine
An organization discovers devastating, costly fraudulent activity. It’s now waffling on spending money on a proactive fraud prevention plan. But while the fraud still stings, now’s the time for a consulting CFE — internal or external — to pitch substantive anti-fraud measures that could save the organization.
Published in Fraud Magazine
Fraud examiners and auditors at most organizations are cognizant of the risks of tangible assets mysteriously vaporizing. But it’s so much more difficult to keep track of proprietary digital information such as trade secrets, customer lists, product details, marketing strategies and PII.
Published in Fraud Magazine
Influencer marketing fraud, tax-credit fraud and restaurateur defrauds.
Published in Fraud Magazine
Tyler Shultz, our 2019 Sentinel Award winner, wasn’t a CFE. He was a young, idealistic, budding scientist who helped unravel one of the most prolific frauds in years. His intuition led him to start questioning what was going on at Theranos, a blood-testing company founded in Silicon Valley.
Published in Fraud Magazine
Poachers and hunters are committing fraud to enable slaughter of big game in southern Africa and shipping their trophies — or horns and tusks — over borders. One CFE is valiantly working to reverse the accelerating carnage and corruption.
Published in Fraud Magazine
The ACFE presented Norman DeBoer, CFE, the Certified Fraud Examiner of the Year award at the 30th Annual ACFE Global Fraud Conference in June. DeBoer, a detective with the Waterloo (Ontario, Canada) Regional Police Service for 29 years, completed in 2018 the precedent-setting $12 million financial advisor fraud case of Daniel P. Reeve, who received a 14-year prison sentence.
Published in Fraud Magazine
Complex business environments require fraud examiners to have diverse skills and holistic points of view to properly address the plethora of business risks. Escape your biases. Consider multiple sets of guidance to stay apprised to increase business transparency and dismantle silos of information.
Published in Fraud Magazine
Fraudsters have invented new themes on old schemes. They threaten to suspend Social Security numbers or tell victims they owe money to fake government organizations.
Published in Fraud Magazine
Opportunistic fraudsters often have an advantage over CFEs: They can freely and spontaneously select co-conspirators by skill, position and corruptibility. To level the playing field, CFEs can work more closely with other types of anti-corruption practitioners. Their experience and techniques, when combined with ours, frequently produce extraordinary synergies that outfox versatile criminals.
Published in Fraud Magazine
Tyler Shultz, Theranos whistleblower and ACFE Sentinel Award Winner, explains where things went wrong at the infamous blood-testing company and why he couldn’t sit back silently — even at the potential expense of his relationship with his grandfather, George Shultz, and facing the prospect of likely litigation.
Published in Fraud Magazine
Published in Fraud Magazine
Amid a surge in global mergers and acquisitions, regulators are increasingly holding organizations responsible for the bribery, corruption and fraud found at the entities they purchase. Data analytics is becoming an important tool in a due diligence process that’s more important than ever for companies seeking to avoid such risks.
Published in Fraud Magazine
Every organization has them: toxic leaders who sacrifice others for their selfish needs. At the very least, these managers can make our jobs difficult or derail our investigations and, at worst, commit fraud. Here’s how to deal with them.
Published in Fraud Magazine
Small businesses are particularly susceptible to payroll fraud, and they can go under as a result. Here’s a story about a controller who used many tricks in the books to rob a medical practice and some lessons on how to detect and avoid such scams.
Published in Fraud Magazine
On Dec. 2, 2001, Enron declared bankruptcy. Governmental and media investigations led to criminal and civil trials of executives Ken Lay, Jeffrey Skilling, Andrew Fastow and many more. U.S. legislation ensued, but did the collapse of this corporation, which ruined so many lives, engender any lessons?
Published in Fraud Magazine
Published in Fraud Magazine
When I first started teaching fraud at the university level about 20 years ago, I had no idea that I was about to be handed a case study like no other. A few months later the now-infamous accounting scandal at Enron hit the headlines, and the once-celebrated energy firm collapsed in disgrace soon thereafter.
Published in Fraud Magazine
The COVID-19 pandemic has created a host of public health crises — and unearthed more opportunities for fraud. Scammers and fraudsters are waiting in the wings to capitalize on lax controls and vulnerable public assistance programs. Here the authors cover ways to enrich and strengthen your organization’s fraud risk management program to reduce threats from bad actors and to help spot the red flags of criminal activity.
Published in Fraud Magazine
Timothy Pikas has spent his career fighting fraud on behalf of various U.S. governmental agencies, including the Air Force Office of Special Investigations, the Nuclear Regulatory Commission and the Department of the Interior. Along the way, the 2021 Certified Fraud Examiner of the Year learned that a solid fraud case takes time to build, and he counsels fellow CFEs to keep the faith and remain patient when conducting their own fraud examinations.
Published in Fraud Magazine
The Fraud Risk Management Guide has provided valuable guidance to fraud examiners, company leaders and other professionals since it was published five years ago. Now, the Committee of Sponsoring Organizations of the Treadway Commission and the ACFE — the guide’s creators — will incorporate users’ feedback to produce a stronger, updated edition.
Published in Fraud Magazine
Fraudulent use of letters of credit has run rampant in Libya amid a chaotic civil war. We look at cases in this opaque corner of the trade finance market to better understand how fraudsters are exploiting a financial instrument that helps drive global trade but also opens doors for wrongdoing.
Published in Fraud Magazine
Non-fungible tokens are all the rage in the crypto world, potentially revolutionizing the sale of everything from art to real estate. But their complexity and the public’s poor understanding of the new technology make NFTs perfect vehicles for fraudsters.
Published in Fraud Magazine
In North America, toll-free phone numbers have one of the area codes 800, 844, 855 and several others, including 833. Fraudsters have seized that last area code to entice would-be victims to divulge personally identifiable information. Also, here’s information on a new COVID-19 scam and a gift-card fraud that purportedly involves your boss.
Published in Fraud Magazine
Incidences of fraud and counterfeiting are escalating in most high-stakes collectibles markets — take art fraud, coin fraud and wine fraud, for example. But the vintage comic-book industry stands impervious even as comic book values soar.
Published in Fraud Magazine
The growing pandemic of coronavirus disease 2019 (COVID-19) is a global concern. It threatens to disrupt everything from international travel and supply chains to health care operations and the global economy. Like other natural disasters, the outbreak has also become an opportunity for fraudsters to cash in on public fears.
Published in Fraud Magazine
Taz Kalolwala has worked her way up the corporate ladder during the course of her career, but it’s her people skills and team-nurturing abilities that sets her apart. She advises fellow CFEs to remain humble and continuously seek help from other anti-fraud professionals.
Published in Fraud Magazine
Published in Fraud Magazine
Fellow Certified Fraud Examiners elected Lyn Cameron, Kenneth R. Dieffenbach and Victoria Meyer to the 2020-2021 ACFE Board of Regents from candidates selected by the Board’s nomination committee. The three new regents took office at the Board’s meeting in February at ACFE headquarters in Austin, Texas. They replaced Ryan C. Hubbs, Tony Prior and Elizabeth Simon who’ve served their terms.
Published in Fraud Magazine
Cryptocurrencies and cybercriminals aren’t going anywhere. Here’s how some fraud examiners discovered systematic patterns of attacker activity at a bank and instituted controls that protected the institution and helped a cryptocurrency exchange prevent future attacks.
Published in Fraud Magazine
Employees in the trenches are tired of management talking to them like non-compliant kids. Instead, ask them to think with the curiosity, courage and clarity of kids. Here are ways to elicit anti-fraud compliance by understanding operating environments, clearly stating instructions, avoiding proscriptive rules and more.
Published in Fraud Magazine
A euphemism is an almost automatic and alternative method we use to phrase possibly negative things in a less harmful fashion. Fraudsters use euphemisms to rationalize their crimes. Fraud examiners can use them to elicit confessions or detect fraud in an organization. Here’s what you need to know to spot euphemisms and when fraudsters are using them to mask nefarious deeds.
Published in Fraud Magazine
Once fraud becomes part of an organization’s culture, it can spread and affect employees like a virus. But why would persons with apparently high ethical standards transform into fraudsters? And how can we counteract these fraud viruses?
Published in Fraud Magazine
‘Massive’ Ponzi scheme, Jordan Belfort sues and bettor makes bad gamble
Published in Fraud Magazine
Peruvian fraudsters take advantage of victims’ gullibility and interest in pre-Columbian Andean history plus the vulnerability of powerless indigenous peoples and rampant corruption to commit archeological frauds that exploit and denigrate cultures.
Published in Fraud Magazine
Howard Wilkinson smelled smoke when he was a trader for the Estonian branch of Danske Bank. The fire he discovered is a $230 billion debacle — possibly the largest-ever money-laundering scheme. Wilkinson’s investigative skills could help accelerate European reforms.
Published in Fraud Magazine
Siddharth Kher, CFE, first learned about the anti-fraud profession when he was working at Amazon. His curiosity piqued when he searched the internet for anti-fraud specialization courses and discovered the ACFE.
Published in Fraud Magazine
The U.S. Department of Justice appears to have collusion in its crosshairs with its formation of a procurement and collusion strike force. Here are typical schemes and red flags in the context of new DOJ guidance.
Published in Fraud Magazine
Fraud examiners are always working to persuade management to search for internal fraud and adopt wise prevention controls. However, anti-fraud professionals can only give their best counsel and then work hard for a good outcome. Here are a fraud examiner’s early successes in a case and later frustrating management decisions. Regardless, he’s not daunted.
Published in Fraud Magazine
Nothing’s sacred. Cybercriminals are now faking those “https” secure websites. Don’t fall for them plus assorted new phishing scams and fraudulent Federal Trade Commission letters.
Published in Fraud Magazine
A bond of trust joins auditors with all who depend on the accuracy and completeness of their findings. But venal executives, captured regulators and compromised auditors can subvert that bond, betray confidence and dissipate capital. This article offers key insights and best practices to help CFEs — including those who are auditors — expose and mitigate threats to audit reliability.
Published in Fraud Magazine
The COVID-19 crisis is forcing companies to tackle significant operational, financial and strategic challenges. And some employees might be tempted to engage in embezzlement schemes or even manipulate financial statements, among other improper acts, to address their immediate financial needs.
Published in Fraud Magazine
According to the ACFE’s 2020 Report to the Nations, organizations are favoring civil litigation and internal punishment over referring their fraud cases to law enforcement. Organizations opting for civil litigation increased to 28% in 2020 from the average of 23% for the past decade. Similarly, referrals to law enforcement have dropped from 69% in 2008 to 59% in 2020.
Published in Fraud Magazine
Anti-fraud professionals are uniquely positioned to diagnose sick occupational cultures. Here are answers about workplace cultures that can help head off fraud before it occurs.
Published in Fraud Magazine
At a U.S. military base, 2,400 rounds of government ammunition were missing. This NCIS special agent suspected a Marine Corps gunnery sergeant, but he needed definite proof. The special agent used an unusual mass-screening interview to discover evidence that ultimately led to the gunnery sergeant’s conviction.
Published in Fraud Magazine
Residents of C-suites and boardrooms who exhibit the “Icarus complex” often initially soar but ultimately plummet from lofty heights and take their companies with them. Here’s how organizations can identify them in the hiring process and prevent disaster.
Published in Fraud Magazine
The British Overseas Territories (such as The Cayman Islands) and the British Crown Dependencies traditionally have been jurisdictions fraudsters use to hide proceeds of crime. However, recent legislation on the Islands could make it easier to conduct investigations into fraud and white-collar crime.
Published in Fraud Magazine
Thousands falsely charged with unemployment fraud; another COVID-19 scam out of California; Fraud in the Wake of COVID-19: ACFE Benchmarking Report
Published in Fraud Magazine
One of the greatest challenges in our field is to think like the fraudsters we’re trying to stop. It’s not easy for CFEs to live inside crooks’ minds, but it’s important to put on those “glasses” and try to see our organizations from the fraudster’s mindset.
Published in Fraud Magazine
If resources are valuable, fraudsters will use them to commit crimes. And they love to misuse gold, diamonds and other glittery materials from the depths of the earth. Here’s how countries are battling the schemes and what it all means for fraud examiners.
Published in Fraud Magazine
Sudhir Gidwani, CFE, says in 1984 he first found tremendous joy piecing together the jigsaw puzzle of unearthing fraud during his investigation of the collapse of a major local bank in Hong Kong. “As my experience in fraud and corruption investigations developed, I became more passionate about what I was doing,” he says.
Published in Fraud Magazine
Organizations can’t afford to be oblivious. Anti-fraud professionals are trained to be skeptical. They should teach their “trust but verify” skills to all in their spheres. Here are some cases in which the players didn’t see (or refused to acknowledge) flaming-red flying flags and paid the cost in loss of cash and reputations.
Published in Fraud Magazine
During the COVID-19 lockdowns, how did fraud examiners manage evidence collection? Learn from forensic technology industry experts about collecting custodian information and remote data preservation.
Published in Fraud Magazine
Fraud examiners who work for health care providers should know the stipulations of the EU’s General Data Protection Regulation to protect patients from data breaches. The law also applies to U.S. organizations that provide care for EU citizens.
Published in Fraud Magazine
The last time you probably thought about supply chains was during the early days of the COVID-19 crisis when the toilet-paper shelves were empty. But that TP had to wend its way through a complex journey from pulp mills to your home that involved many parties and chains of events. Disrupt just one step — say because of pandemic fears or fraud — and the chain breaks. Here’s how to help prevent supply chains from fraudulent acts and mitigate them when they do break.
Published in Fraud Magazine
Fraudsters, disguised as potential customers, are sending phishing emails to businesses to foist on them a con game. And scammers are claiming to be approved lenders under the U.S. SBA Paycheck Protection Program, which is part of the Coronavirus Aid, Relief, and Economic Security Act.
Published in Fraud Magazine
Fraud examiners tend to de-emphasize the rationalization factor — to the detriment of prevention efforts. Here’s some of the science behind would-be fraudsters’ justifications and how we can use it practically to deter their crimes.
Published in Fraud Magazine
The fact that the SEC continues to pursue AML violations, and in one instance sought a $23 million penalty, emphasizes that broker-dealers have a continuing incentive to comply with AML obligations.
Published in Fraud Magazine
The ACFE, with members around the globe, has contracts, compliance requirements, intellectual property issues and other matters that ACFE Associate General Counsel Jacob Parks, J.D., CFE, happily handles. “Fraud and corruption are the nemeses of a fair society, which was especially clear after the financial crisis of the late 2000s,” he says. “The ACFE’s mission of fighting fraud worldwide was appealing to me after I saw how much harm was due in large part to deceptive practices on a wide scale.”
Published in Fraud Magazine
The International Organization for Standardization (ISO) is developing new guidelines for whistleblowing management systems — ISO 37002. These international standards are scheduled for completion by the end of 2021. This article describes the background of ISO 37002, its scope and its added value for organizations around the globe.
Published in Fraud Magazine
The ACFE Foundation has awarded $55,000 to college and university students through the Ritchie-Jennings Memorial Scholarship Program for the 2019-2020 school year. Each recipient also will receive a one-year ACFE student membership.
Published in Fraud Magazine
Do you want to make sure you have more fraud in your organization? Then hire bad leaders and poorly train them with outdated methods. Here’s how to avoid employee disengagement by changing attitudes and behaviors.
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Everybody loved Dr. Brian. He appeared to be the perfect professional, spouse, parent and friend. But he fooled everybody. At least for a while. Here’s how he, as the lead administrative physician of a once-thriving practice, skimmed and embezzled more than $25 million in 20 years.
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Cybersecurity expert Theresa Payton says don’t wait until you’re in the middle of a breach to formulate plans. Practice digital disasters. Develop a playbook so everybody knows their roles. Line up your external helpers. Devise your communication strategy. Then, if you’re breached, cooler heads will prevail.
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According to the May 15 ABC News article by Julia Jacobo, “96 people charged in Texas marriage fraud scheme to get Green Cards,” Houston fraudsters are responsible for granting citizenship to Vietnamese nationals who paid hefty fees. Police say ringleader Ashley Yen Nguyen operated a well-organized marriage scam — charging between $50,000 to $70,000 for a marriage license. As a result, nearly 150 people fraudulently obtained green cards to become permanent U.S. residents.
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Container deposit fraud is more than just buddies transporting some empty soda bottles across state lines. We’re talking about multimillion-dollar tax fraud schemes. Here’s how to prevent them.
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Modern technology advances quickly. What’s innovative and fresh one day can be quickly outdated and short-lived in just a few months. As smart devices get smarter, business and industry depend more heavily on them and the data they store, which makes fraud examinations more challenging and complex.
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The Asia Pacific region has become a hotbed for cyber romance scams. Hong Kong cybercrime alone has risen 565% since 2012. The region’s global financial centers also face increasing concerns about cryptocurrency and blockchain money laundering fueled by North Korean cybercrime.
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Fraud examiners are increasingly tackling complicated cases that simultaneously involve several nations. We must look for legal guidance for our organizations’ cross-border operations. Here’s a start.
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Deshietha Partee-Grier, CFE, says she lives by an Eleanor Roosevelt quote: “Great minds discuss ideas. Average minds discuss events. Small minds discuss people.” Deshietha loves discussing ideas and the interplay among her colleagues as they fight money laundering and other types of financial crime. But work isn’t sufficient for her. She mentors high school girls when she’s not nurturing her five children with her husband and working on an MBA.
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The compliance landscape forever shifted after the Enron and WorldCom debacles, among others. Don’t let accelerating corporate governance changes leave your organization and clients unprotected. Here’s how anti-fraud regulations evolve in phases around the globe, a review of compliance history plus practical action plans.
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Oil theft and fraud affects everybody — not just those in far-away nations — because it enables everything from terrorist attacks to human trafficking. The author outlines thieves’ techniques and what countries are doing to battle this multibillion-dollar scourge.
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Medical identity theft is the fastest-growing form of identity fraud. Crooks use a myriad of ways to defraud federal governments and vulnerable patients. Here are the schemes and ways to avoid becoming a victim.
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This former intern learned firsthand about fraud when her boss and mentor, the senior accountant, was arrested for embezzlement and credit card fraud. The author helped discover the crimes at the nonprofit business.
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Three million fraud complaints in 2018. That’s what the Federal Trade Commission received — many of them for identity theft. When we look at the stats since 2001, we see the fraud problem is worsening.
Published in Fraud Magazine
Published in Fraud Magazine
Six candidates have been selected to compete for two positions on the 2021-2022 Board of Regents. The board sets standards to promote professionalism and to ensure the reputation of the CFE credential.
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Leadership is part art, part science and perhaps a bit of alchemy. Selecting individuals to lead companies has become more complex for boards of directors. CEOs must address the interests of all stakeholders — not just shareholders. Organizations should consider grooming honest and proven managers from within to help prevent and deter fraud.
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These case studies will help inoculate medical practices against fraud through sound ACFE principles — from financial oversight to segregation of duties.
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You might be a brilliant fraud examiner, but if your “emotional intelligence” is stunted, you’ll be ineffective with those you work with and investigate. Here’s how to buck the stereotypes of your hard-wired personality, learn practical ways to change your management style and be more empathetic in your job and life.
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Fraudsters tend to steal in similar ways. Here are six number patterns you can search for and possibly find hidden fraud. Learn from the acclaimed authority on Benford’s Law on how numbers can become your best friends.
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Defense contractor allegedly rips off $12.8 million in COVID-19 relief aid; Singapore charges businessman for claiming he held $1 billion for Wirecard; Grand Prix CFO’s tax-defrauding racer stalls
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National agencies are adopting income-asset disclosure management systems to help ensure transparency and accountability among high-level political and governmental officials.
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Interviewing narcissists during a fraud examination demand special skills. Here are some practical ways to interview those who have inflated self-perceptions and are missing solid self-esteem fundamentals.
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From the President
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When Priti Amin, CFE, was young she knew she wanted to do something that helped others because honesty, trust and personal integrity were important to her. Those values compelled Amin in her journey to fight fraud. Within Vodafone Group, a global technology communications organization, Amin is the Vodafone Business fraud manager. She’s responsible for managing fraud risks for the entity, its products, services and customers.
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Given the current economic climate and regulatory expectations, monitoring procurement spending for fraud, waste and abuse (aka “leakage”) is even more important. We can proactively monitor procurement data via big data analytics, which will reveal transactions that are fraudulent or diminish working capital.
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Use the new Anti-Fraud Playbook, produced by the ACFE and Grant Thornton, to operationalize leading guidance from the ACFE/COSO Fraud Risk Management Guide to help your organization move from theory to practice.
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CFEs discuss how they know when they should devote resources to launch fraud examinations or at least preliminary investigations.
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Travel and entertainment spending is common in many industries, but it also opens the door for disgruntled or seedy employees to steal from organizational coffers. Falsified invoices, altered receipts and spending on personal luxuries can add up. Fraud examiners can use data analytics and tested fraud examination techniques to root out employees with nefarious intentions.
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The IRS won’t call you or text you to threaten jail. And the pandemic has created security threats and opened new opportunities for cybercriminals. Plus, tax pros need VPNs.
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The startup world contains ample pressure, opportunity and willingness of entrepreneurs to rationalize decisions to secure market share and deliver on the promises they made to investors. Rarely do the teams that conduct due diligence for VCs and PE firms include someone with experience in detecting and investigating fraud.
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Deborah Kovalik, a member of the ACFE since 1995, died Jan. 26, 2018. Kovalik was a director in the EisnerAmper Tax Department with a specialty in forensic, litigation and valuation services. Kovalik is survived by her husband, Walter Pagano, CFE, CPA, a partner at EisnerAmper LLP.
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Certified Fraud Examiners elected Eric R. Feldman, CFE, and Bethmara Kessler, CFE, to the 2019-2020 ACFE Board of Regents. Fellow CFEs elected them from six candidates selected by the Board’s ACFE Nomination Committee. Feldman and Kessler took office at the board’s meeting in February at ACFE headquarters in Austin, Texas.
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A pensive 25-year fraud examiner shares lessons on working well with colleagues and thriving in the profession. Though much has changed in a quarter of a century, foundational rules will always be in style.
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Criminals are using a new form of fraud called credit privacy numbers (CPN) to defraud financial institutions and game credit bureaus. Fraud examiners will have to pool their resources and use investigative skills to connect the dots between credit bureaus and banks, and find new ways to combat this plague.
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Fraudsters increasingly are using shell companies to commit everything from asset misappropriation and money laundering to bribery and corruption schemes. Audit committees want fraud examiners to make sure their organizations aren’t victims. Here’s how to use fraud data analytics to sniff out illegal shells.
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Sentinels face few positive reasons for reporting questionable activity or fraud. They often lose their jobs, health, reputations and family stability. Yet every year a handful of whistleblowers step out from the crowd. Here are some reasons why they do it.
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Hackers target DNA tests, elder abuse fraud costs soar and home goods giant accused of securities fraud.
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Time thieves can become time fraudsters in the right conditions. Protect your employees and organizations by suggesting to top management and human resources departments that they embed sophisticated time-tracking software, procedures and training.
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The ACFE bestows our Cressey Award annually on someone who’s demonstrated a lifetime of achievement in the detection and deterrence of fraud. This year’s winner couldn’t be more deserving. Lisa Osofsky, the director of the U.K.’s Serious Fraud Office (SFO), has devoted a lifetime of service to fraud awareness on a global scale.
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The United Kingdom is a haven for dirty money. Some estimate that money launderers might be hiding 90 billion pounds per year — primarily through high-end real estate. The “Unexplained Wealth Orders,” introduced in 2018, might be stanching the flow.
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As a criminal investigator and training & operations manager at the U.S. Army Criminal Investigation Command in Fort Hood, Texas, Kendrick Thomas, CFE, credits his expanding knowledge of white-collar crime to the connections he’s made as a Certified Fraud Examiner.
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Members of the board of 1MDB — a Malaysian federal strategic investment fund — and top Malaysian government officials plus private citizens allegedly illegally syphoned and laundered billions from the fund. Here’s how they escaped controls and lined their pockets.
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Lisa Osofsky views her dual citizenship as an advantage at the SFO. She’s worked in the anti-fraud private and public sectors, and in the U.S. and U.K. judicial and prosecutorial systems. She intends to use proactive techniques, global cooperation and the latest financial tools to make the U.K. an inhospitable environment for fraudsters.
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Doing good deeds is generally recognized as positive. However, these gestures sometimes can be part of a psychological process to license and compensate for aberrant behaviors. A fraud examiner who’s aware of the potential psychological ramifications of these deeds might be able to proactively interdict fraud schemes and mitigate losses of these schemes.
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Do you even answer your cellphone anymore? Fraudsters are sending phone messages with spoofed area codes, numbers and names. Here’s how to avoid the scammers plus information on college test prep scams and online payroll check thefts.
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Published in Fraud Magazine
The COVID-19 pandemic changed the way we work and provided an opportunity for fraudsters to scam the populace like never before. The ACFE Board of Regents looks back on its experiences and provides advice on how to fight fraud in this post-coronavirus landscape.
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Fraudsters love a good crisis. Governments worldwide established procurement procedures during COVID-19, but quick actions to save lives often bypassed standard safeguards. Here’s how government agencies during future disasters can limit and/or prevent rampant corruption and fraud.
Published in Fraud Magazine
Published in Fraud Magazine
Cyberattacks have always made headlines. But they’re now occurring more frequently and causing widespread damage. Hackers have broadened their reach by infecting supply chains with ransomware and have recently crippled oil pipelines, meatpacking plants and grocery stores across the globe.
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Tania Ramirez started her career as an internal auditor, working at such organizations as Canadian National Railway, McGill University and consultant Protiviti. She soon discovered she had a knack for uncovering dubious transactions. That talent catapulted her into the world of fraud investigations and landed her a dream job at Randstad, a global leader in the human resources services industry, where she now combines both skills to uncover cybercrimes, occupational fraud and other types of fraudulent activity.
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You knew that when U.S. states began holding vaccine lotteries and sweepstakes, fraudsters would get in on the action. Also, here’s what happens when crooks attack their victims — again.
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Organizations are increasingly striving to meet environmental, social and governance (ESG) standards, at least on paper. CFEs may be well versed in the “G” of ESG but they also need to know about the “E” and “S” to understand whether CEOs are truly sticking to the values they tout.
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Intuition, sensitivity to nonverbal cues, pattern recognition — our brains are capable of rapidly processing information to help us make judgments and decisions. This ability is called “thin-slicing.” It can provide another tool for fraud examiners to follow their instincts to the truth but only when we use it properly and recognize its limitations.
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With people increasingly living their lives online, fraudsters have never had easier access to potential victims. COVID-19 has only accelerated that trend. Indeed, business is booming for cybercriminals now focused on high-value organizations. Fraud Magazine talks to cyber expert Robert Herjavec and CFEs about how best to tackle this ever-evolving threat.
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Cheating in online higher-ed classes existed long before the pandemic. Not surprisingly, exam fraud burgeoned when COVID forced most students to work in isolation. CFEs should consider how to minimize the chances for college cheaters to become occupational fraudsters and so limit negative effects for workplaces.
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When the U.S. Affordable Care Act was enacted in 2010, the for-profit drug rehab industry was essentially given a blank check to treat people struggling with addiction. In the decade since, many of these underregulated businesses — rife with fraud, waste and abuse — have commoditized addicts. Through the lens of a recent high-profile criminal case in California, here’s the background on the issue, and some advice from experts on how to combat this unique type of provider fraud.
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“Ikigai,” the Japanese notion of being truly fulfilled and how a person’s work relates to their purpose, spurred former paralegal Tracy Swaim to seek more. Conversations with a fraud investigator excited her about entering the field. She earned her CFE credential and now works in a job that checks all the boxes for her: mission, passion, vocation and profession.
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Despite futurists’ predictions, we don’t live in a paperless business world. Printer ink and toner are still an expensive necessity. Fraudsters depend on ink costing organizations more than caviar. Here’s how to prevent this asset misappropriation and possibly save millions.
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How do fraud examiners conduct fraud examinations when they often can’t meet their team members and subjects in person? These experts — during pandemic constraints — discuss their biggest investigation hurdles, maintaining professional skepticism, best practices, eDiscovery challenges, chain of custody, interviewing constraints and more.
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CFEs should consider all aspects of a fraud case when calculating the impact of fraud. Here are three primary calculations when reporting the amount of fraud impact: Total exposure, fraud amount and known loss.
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From its early days as The White Paper to the 72-page bimonthly publication it is now, Fraud Magazine’s continued credibility and necessity to the anti-fraud profession is in part thanks to the leadership of its editor-in-chief, Dick Carozza. After 25 years at the helm, Carozza is stepping back and retiring. Here we take a look at the history of Fraud Magazine and the large role Carozza played in its success.
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Ponzi schemer flees on water scooter, shysters rent parking spots and more
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Imagine if citizens, journalists, oversight agencies, and internal and external auditors were able to view all transactions of taxpayer and donors’ money online. The fraud prevention and deterrence possibilities are endless.
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Cybercriminals hit public institutions hard with ransomware in 2019 and 2020. Colleges and universities lost millions to fraudsters. These thieves endangered students’ records and stole PII, which they sold on the dark web. Administrators must train students, educators and staffs to avoid opening suspicious email attachments.
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2020 is officially behind us, but its repercussions will live with us for a long time. Nothing prepared us — professionally or personally — for the pandemic. COVID-19 probably has permanently changed the ways we operate. But we’ve been resilient as we work through tremendous disruptions. We’re fighting the good fight to protect our organizations from fraud despite our limitations.
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The pandemic is leading to increased fraud and criminals’ evolving tactics. Fraud examiners are facing budgetary and logistical constraints, and operational limitations. Here’s how these conditions could affect European anti-fraud efforts this year.
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Alan Small, CFE, first became acquainted with fraud investigations in 1973 as a member of the Baltimore (Maryland) Police Department. His first assignment was with the criminal investigation division where he reviewed and followed the assignments of experienced detectives engaged in the investigation of high-profile cases, which included fraud.
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More organizations are collaborating with data-sharing consortiums to safely exchange fraud risk profile information that could improve their internal prevention and detection activities. Here’s an interview with Matt Galvin, global VP of ethics and compliance at Anheuser-Busch (AB) InBev, who discusses how cross-company collaboration might affect the anti-fraud profession.
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Jerry thought he had it made in the shade. As he began his company maintaining oil rigs and equipment, he'd found ways – the keys to the kingdom – to fraudulently bill his former employer as a contractor. He knew how to thoroughly exploit the system he'd helped devise. Learn lessons from this fictionalized version of an actual $2 million fraud case.
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We were all glad to discard our 2020 calendars. Fraudsters took advantage of COVID-19 conditions, but not all of them needed an pandemic to pull off some big frauds. We've distilled a long list of cases to give you a few shockers.
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The pandemic is bad enough, but scammers are out there waiting to steal your money and identity via COVID-19 fraud. Here also is the newest utility bill scam.
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Ritchie-Jennings Memorial Scholarship program accepting applications; ACFE Board of Regents expels two members
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Once a poster child for Germany’s fintech sector, Wirecard — along with its ambitious CEO — was exposed as a massive fraud that seduced investors. Learn how to analyze the case by emphasizing four attributes.
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You can learn “charismatic/crisis-response” leadership characteristics to help your people continue their jobs without wavering. Crisis leadership requires intensely focused, committed actions to try to eliminate uncertainty, fear, panic and chaos.
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This Lambo loan is a no-no; 6 former NFL players allegedly try to game the system; Czech your investors before you give them cash
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As I listened to the stories of former U.S. Drug Enforcement Administration agents, Javier Peña and Steve Murphy — the inspirations behind the Netflix series “Narcos” — I sensed their passion for catching Pablo Escobar and other drug traffickers. Despite enduring constant danger and peril, they seized the mission to disrupt the narcotics trade in Colombia.
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When Tasheika Hinson, CFE, was 8 years old, she made a pact with her childhood friend that they’d grow up to become attorneys. Hinson would go on to become an assistant U.S. attorney at the Department of Justice and now is the head of investigations at The Vanguard Group Inc. where she leads internal investigations and partners with internal teams in its 19 offices around the world.
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The U.S. Department of Justice (DOJ) recently updated its “Evaluation of Corporate Compliance Programs,” the primary guidance for DOJ prosecutors when they assess penalties. These updates provide insights into the factors DOJ is likely to emphasize when it evaluates the effectiveness of your organization’s compliance program — should you come under scrutiny.
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The ACFE had three months to plan a virtual 31st Annual ACFE Global Fraud Conference from scratch. The result is in the numbers and responses: 4,472 attended and 94 percent of the participants were satisfied. Lemonade never tasted so good.
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In this excerpt from “Manhunters: How We Took Down Pablo Escobar,” retired U.S. Drug Enforcement Administration agents Steve Murphy and Javier Peña each share harrowing encounters with possible Escobar henchmen during their time in Colombia investigating and hunting the notorious drug lord.
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On July 5, 2011, the tanker ship, Brillante Virtuoso, which was carrying 140,000 metric tons of fuel oil, was drifting within Yemeni waters. Later in the day, a small boat with seven armed men approached the vessel. The men, who claimed to be a “security team” to escort the tanker through the Gulf of Aden from the Arabian Sea, hijacked the ship and demanded that the vessel proceed to Somalia.
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The recipient of the 2020 Educator of the Year Award, who owned a CPA firm for decades, had a lifelong desire to teach students forensic accounting and fraud examination at a university. In 2015, he got his chance. Now, he’s challenging ACFE members to do the same.
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Retired U.S. Drug Enforcement Administration agents Steve Murphy and Javier Peña — the inspirations behind the hit show “Narcos” on Netflix — tell the tale of their time in Colombia, investigating and capturing notorious narcoterrorist and Colombian drug lord, Pablo Escobar. Not everything you see on TV is true, but their story comes pretty close.
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January of this year now seems like a quaint time. Since then, the world has stretched in bizarre ways, and it probably won’t ever resume its previous shape. The Board of Regents want to encourage you as your organizations need your anti-fraud skills more than ever.
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Fraudsters add to COVID-19 woes by ripping off unemployment benefits. And, of course, they’ve figured out how to profit from contact-tracing programs. Plus, employers must reduce risk of data loss and theft after layoffs and furloughs.
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The Wirecard case and recent PCAOB inspection reports on the top six audit firms highlight continued issues with audit quality and the independent auditor’s responsibility in uncovering material misstatements due to fraud. They also emphasize the need for the auditing profession to hasten improvements.
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The battery in your cellphone could be powered by cobalt derived from copper that exploited “artisanal miners” — often children — hand dug from open-pit mines in the Democratic Republic of Congo. But a new DRC government could crack down on the illegal awarding of mine licenses, permits and contracts. And blockchain could make supply chains more transparent.
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Dan McCrum, an investigative reporter for the Financial Times, spent six years questioning the finances of Wirecard, Germany’s moneymaking payments processor. Fraudulent Wirecard would strike back against McCrum and his wife with smear campaigns, lawsuits and surveillance. German banks and regulators targeted him. But his efforts paid off. Read about his crazy, weird investigation.
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All of us want to look in the mirror and feel good about ourselves. But secretly we also want to benefit some from our dishonesty. Acclaimed behavioral economist Dan Ariely ponders this dichotomy every day. His research findings could help fraud examiners deter would-be fraudsters.
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Deutsche Bank’s “referral fees,” China’s corruption death sentence and more
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The FraudClassifier model, developed by a U.S. Federal Reserve-led industry work group, provides the payments industry with an intuitive classification approach to help fraud fighters get on the same page to understand the nature and magnitude of fraud.
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Wirecard was once a fast-rising European fintech company that grew primarily through acquisitions. Now it’s dubbed the “Enron of Germany.”
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Illegal logging companies in the Amazon regions, which are driving deforestation, are using multiple fraud schemes. They include fake or forged permits based on fraudulent information; corruption and collusion of and with officials who are supposed to enforce timber regulations; and front companies to avoid taxes.
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Chrysti Ziegler, CFE, the president of the ACFE Houston Area Chapter, was thrilled to discover the art of fraud fighting early in her career as an auditor. Her interest was piqued when she first learned about the idea of malicious intent. She was hooked. Her passion then grew for joining the force against fraud.
Published in Fraud Magazine
Bad actors don’t let a good crisis go to waste. Shifting of governmental department of health mandates and the absence of systems to capture evidence of compliance have contributed to a perfect storm of fraudulent employment claims during the pandemic. But you can still find hard data to drive your investigations and defense strategies.
Published in Fraud Magazine
Amazon and Apple aren’t calling you to warn you of suspicious activity. And vaccine scammers are here. Plus don’t get lax in concocting new passwords.
Published in Fraud Magazine
Telemedicine isn’t a new concept. It’s become an integral element of health care delivery. However, it’s prone to fraud opportunities because of the absence of direct patient contact. U.S. federal loosening of regulations during the pandemic has opened the door for more telemedicine visits and potential for fraud.
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Raushi Conrad was a longtime, well-liked U.S. federal government high-tech specialist. He bucked the stereotype of the aloof, arrogant IT worker. But an anonymous email led to an investigation that showed he’d committed a one-man $1 million internal fraud scheme that involved chicken restaurants, computer viruses and “wink-and-a-nod” briberies. Here’s how to fend off similar high-tech crimes.
Published in Fraud Magazine
Lyn Cameron, CFE; Kenneth R. Dieffenbach, CFE; and Victoria Meyer, CFE, took their oaths of office as newly elected members of the Board of Regents during the board’s semi-annual meeting on Feb. 6 at ACFE Global Headquarters in Austin, Texas.
Published in Fraud Magazine
Can Benford’s Law practically identify fraud? It’s one of many tests you can use to discover fictitious numbers in supposedly random datasets, such as monetary amounts of purchase transactions. In this case, a comptroller successfully uses Benford’s Law to search for anomalies in warranty claims.
Published in Fraud Magazine
Fraudsters are beginning to find the cracks in the armor of blockchains and cryptocurrencies. Initial coin offerings, Simple Agreements for Future Tokens and fake currencies are vulnerable areas. Here’s practical information for warning your organizations and clients.
Published in Fraud Magazine
For years, journalist Daphne Caruana Galizia probed the activities of Malta’s ruling elite. She shared her findings — drug smuggling, money laundering, government corruption — on her blog, “Running Commentary,” and was regularly intimidated for her work. In 2017, she was murdered in a car bombing in Malta. Thousands have mourned her and demanded justice. Her son, Matthew Caruana Galizia, shares his mother’s story and how he and other investigative journalists worldwide are honoring her legacy.
Published in Fraud Magazine
Drexel University’s Fraud and Internal Control Case Competition (FIC3) lifts anti-fraud concepts off textbook pages and ingrains them into students’ lives. Learn how to help higher-ed institutions develop similar competitions.
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Coronavirus stimulus check scam, infamous Russian hacker charged and Georgia man attempts to fraudulently capitalize on pandemic.
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Daphne Caruana Galizia had the same dogged pursuit of fraudsters and the desire to bring them to justice that you do. She was an investigative journalist in Malta who was unwavering in her pursuit of allegations of corruption by government officials and businesspeople in her country. Tragically, she lost her life because of that pursuit.
Published in Fraud Magazine
Traditional corruption frauds — bribery, kickbacks and conflicts of interest — are affecting water management and availability in Australia. Droughts, fires, and floods are raising the stakes.
Published in Fraud Magazine
Mark Lee Greenblatt, CFE, says he’s learned the importance of being fair, independent and objective — as an individual and as a leader within his organization. “In the inspector general community, we have a special responsibility as the independent oversight mechanism within our departments, and I’ve learned that we can be effective only if we operate with integrity,” says Greenblatt, inspector general at the U.S. Department of Interior.
Published in Fraud Magazine
How should fraud examiners and legal professionals meet compliance standards but also keep individuals’ and organizations’ data private? “Differential privacy” is a system of cybersecurity that proponents claim can protect data far better than traditional sanitizing or anonymizing methods.
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A business can legitimately sell its outstanding invoices for a percentage of their face value to receive money quickly to expedite cash flow. The process allows nearly $3 trillion in transactions per year worldwide. However, invoice factoring is vulnerable to fraudsters. This case shows red flags and susceptibilities.
Published in Fraud Magazine
In separate scams, fraudsters target would-be victims who are worried about packages they might never receive plus COVID-19 threats. The criminals play on fears to harvest personally identifiable information.
Published in Fraud Magazine
The C4 quotient — a combination of curiosity, creativity, critical thinking and collaboration — increases with the freedom to explore and innovate in our workplace. Backed by psychology and neuroscience, effective leaders can foster a more engaged and productive workforce, and in turn eliminate instances of fraud and abuse.
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Thulisile “Thuli” Madonsela has probably done more than any single person in South Africa to bust the lid off widespread fraud and corruption during the term of former President Jacob Zuma. She speaks about her experiences during that time and what more needs to be done.
Published in Fraud Magazine
Sometimes fraud examiners need to record covert surveillance in their cases. But will their audio and video recordings be admissible in court? Here we examine a high-profile bribery case to test all the legal angles in deciding the usability of evidence in Europe and, by extension, the rest of the world.
Published in Fraud Magazine
Pet poodle comes to the rescue in German fraud case. Hospital employee accused of skipping work on full pay for 15 years. Fraudsters steal millions in Hong Kong’s biggest phone scam.
Published in Fraud Magazine
Fraudsters combine stolen personally identifiable information from many different individuals to create dangerous Frankenstein identities. Guard against this growing insidious fraud and protect the IDs of your customers.
Published in Fraud Magazine
Our profession requires plenty of insight and knowledge to understand the fraud landscape. But it also takes a good measure of moxie. Thulisile “Thuli” Madonsela is one of those unique people who possesses that know-how and fortitude — at an extraordinary level.
Published in Fraud Magazine
Since becoming a CFE close to 20 years ago, Sophia Pretrick has been fighting fraud in the Federated States of Micronesia, where she grew up. Early in her career, Pretrick quickly became fascinated with how ubiquitous fraud was and the fact that preventing it could improve the lives of her fellow Micronesians. This year, the U.S. Secretary of State Anthony Blinken awarded Pretrick with the newly created International Anticorruption Champions Award in recognition of individuals who’ve worked tirelessly to defend transparency, combat corruption and ensure accountabilities in their countries.
Published in Fraud Magazine
Fraud examiners understand the importance of knowing whom you’re doing business with. From compliance and due diligence to investigative asset tracing, solid background-checking skills are key tools for CFEs. But beyond traditional methods, new techniques are emerging to greatly enhance business transparency — and some may surprise you.
Published in Fraud Magazine
Bernie Madoff is gone, but the effects of his crimes live on. Fraud examiners endeavor to learn from all frauds, including the world’s largest-ever Ponzi scheme. What lessons have we learned? How has the regulatory environment improved? How have Madoff’s schemes affected the anti-fraud profession?
Published in Fraud Magazine
Preet Bharara speaks about lessons learned, the outlook for new insider trading rules under the Biden administration, the challenges of overseeing COVID-relief funds, the difficulties of investigating Ponzi schemes and much more.
Published in Fraud Magazine
Identity-theft fraudsters with no consciences use any opportunity to find new victims. Witness attempts to rip off vaccine hunters, caring grandparents and desperate job seekers.
Published in Fraud Magazine
It’s logical to think that companies on the verge of bankruptcy or suffering severe financial stress might be tempted to fudge their financial statements. Yet a recent university study says that large prestigious public firms are even more prone to cooking the books. We look at why this might be the case and the need to delve into the psychology of individual perpetrators.
Published in Fraud Magazine
Eric R. Feldman, CFE, and Bethmara Kessler, CFE, took their oaths of office as newly elected members of the Board of Regents during the board’s semi-annual meeting on Feb. 7 at ACFE Global Headquarters in Austin, Texas.
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Bill Browder assumes the mantle of his fallen friend, Sergei Magnitsky, as he ferrets out fraud and corruption around the world and searches for $230 million in allegedly stolen laundered Russian funds. Despite the risks, this human-rights activist says he can’t look the other way.
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Fraud examiners often stumble upon unsought information. Here’s how to train yourself to find that info so you can detect other potential frauds, obtain evidence, recover fraud-related losses, identify and correct deficiencies, and more.
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Countries routinely use sanctions on nations to deter and penalize bad behavior. But what if economic restrictions cause criminals to seek the anonymity of alternative currencies? We possibly could see increases in fraud, money laundering and terrorism financing. Or not. The jury’s still out. Here’s what fraud examiners and law enforcement can do as nations move to their own parallel virtual and traditional monetary systems.
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Here’s brutal honesty from CFEs who’ve spent decades as expert witnesses. Prerequisites: thick skin, penchant for over-preparedness and meticulousness, ability to think quickly, poise and a supply of heavy-duty deodorant.
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The U.S. federal government disburses billions in grants annually to worthy recipients. These awards aim to make life better by promoting research and development, finding new disease treatments plus improving education, infrastructure, housing and much more. Of course, big money attracts fraudsters. Here we examine three main types of schemes and how fraud examiners can prevent and deter grant fraud. We also dissect the government’s latest anti-fraud guidance.
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Yale dad uncovers college admissions scandal; West Coast ATM skimmers arrested; flooring company pays millions in penalties
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Who’d have thought a multimillion-dollar fraud case would have the intrigue of a Cold War spy novel? And who could’ve predicted the irony of the grandson of the leader of the American Communist Party becoming a prominent capitalist in post-Soviet Russia? Truth really is stranger than fiction.
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Fabulous wealth, staggering poverty, political imbalances and ancient tribal cultures can worsen fraud and corruption. But some organizations and governments in the Middle East are beginning to take tougher stances.
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As cyber incidents become more complex, your organization’s ability to perform sufficient investigations must adapt. We explore pitfalls that businesses commonly struggle with as they deal with cyber incidents.
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We are now at a tipping point in the field of lie and truth detection. Peer-reviewed research and high-stake applications are showing that we need two main skillsets to perform better than the average human and the polygraph: 1) recognizing deceptive behavior via multi-channel analysis and 2) using unexpected prompts in interviews to elicit truth.
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In an episode of the popular television crime drama “Better Call Saul,” a lawyer stumbles upon a case of health care fraud. In real life, fraud examiners are leading the fight against these types of widespread fraud schemes by gathering evidence, analyzing documents and separating fact from fiction.
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Shopping online is almost second nature now, right? But you could be jeopardizing your identity by just entering information into web page forms. Learn about “formjacking,” how fake Netflix sites are phishing for your PII, Medicare scams and more.
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In a new ACFE research study, In-House Fraud Investigation Teams Benchmarking Report, 58% of anti-fraud professionals say their organizations have inadequate levels of anti-fraud staffing and resources.
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Fraudsters are doing more than shutting down sites by flooding them with millions of automated inquiries. They’re infecting websites with malware that unsuspecting users are downloading on their devices. Here’s how to advise your organizations and clients to protect domain name servers that will prevent loss of revenue, productivity and reputation.
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Most people don’t like being stuck in obscurity in their profession. They want recognition and compensation for their value. Here’s how to build a reputation or professional brand as an influencer in your anti-fraud field.
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Deepfakes are no longer just amusing YouTube videos. Fraudsters are beginning to use them for business email compromises. Cyber experts say phone scams, sham celebrity endorsements, biometric fakes and bogus evidence could quickly follow. Now’s the time to advise your organizations.
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An anonymous whistleblower hotline should be a critical weapon of any organization’s anti-fraud arsenal. Fraud examiners should understand some of the key success factors that make hotlines good tools in fighting fraud.
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$50 million by age 50 could get lawyer 50 years; he’s just not that into you; not the outcome these execs were hoping for
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The U.S. Department of Defense (DOD) is trying to ameliorate its deteriorating global advantage by using its Congress-granted “Other Transaction Authority” when working with vendors. But OTAs might allow fraud, waste and abuse to creep in. Here’s how the DOD can improve.
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Jules Kroll didn’t start out to create one of the largest investigative firms in the world. However, he did recognize the need for such a service for corporations and governments after he battled corruption against his father’s printing business.
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Trust your instincts, keep digging, look for patterns and know how to navigate technology to find anomalies. These are the skills Rachel Jolicoeur, CFE, has learned over the course of her career.
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Artificial intelligence and machine learning seem to be included in most technology discussions. But what do these potential technologies really mean for fraud examiners and compliance professionals?
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Jules Kroll assembles diverse professionals — fraud examiners, forensic accountants, academics, investigative journalists, former prosecutors and attorneys — to fight fraud. That’s been his modus oprandi since 1972. As chairman and cofounder of K2 Intelligence, he continues that course.
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Fraudsters always find new ways to rip off consumers. They’re stealing money via gift cards, back- and knee-brace schemes and your American Express credit card.
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The ACFE believes that large, noteworthy fraud cases like Enron or Bernie Madoff will live on in infamy and provide valuable lessons for fraud fighters and the general public. That is why we, along with input from our members, have selected the following five stories as the most noteworthy frauds of 2019. The stories were chosen based on the amount of money lost, the number of lives impacted and/or the relevance to the anti-fraud profession.
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Anti-fraud professionals know that while it’s best to catch fraud as soon as possible, it’s even better to stop fraud before it happens — which is why active fraud prevention is a critical part of anti-fraud strategies for organizations of any size. The ACFE established International Fraud Awareness Week (Fraud Week) to give organizations a dedicated time to spread anti-fraud education with employees and within their communities.
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You might not know it, but today is an important day for you. On Dec. 27, 1939 — 80 years ago — criminologist Dr. Edwin Sutherland, while speaking to the American Sociological Society, coined “white-collar crime” and placed the cornerstone in the foundation for the fraud examination profession.
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On Feb. 10, 2015, Nova Healthcare Management pleaded guilty to felonious workers’ compensation fraud and agreed to repay Texas Mutual Insurance Company more than $6 million. The investigation revealed that Nova Healthcare Management (also known as Nova Medical Centers or Nova) overbilled Texas Mutual for physical therapy by billing services as more expensive one-on-one therapy when it actually provided group therapy.
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It started with a phone call on Dec. 21, 2018. An 84-year-old Florida woman (we’ll call her June) received a call from a man who said he was attorney Thomas Wilson. He informed June that her grandson had caused an automobile accident, and the driver of the other car apparently was a pregnant woman who miscarried as a result of the accident. He said she was suing June’s grandson.
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Fraudsters wield technology like weapons to commit their crimes. Fraud examiners must match and supersede their foes with advanced high-tech tools. Here are the results of a recent ACFE survey that show how anti-fraud professionals are using technology and their plans for the future.
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Nine candidates have been selected to compete for three positions on the 2020-2021 Board of Regents. The board sets standards to promote professionalism and to ensure the reputation of the CFE credential.
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On March 14, the Institute of Fraud Prevention (IFP) merged with the ACFE Foundation, which expanded the Foundation’s mission beyond college scholarships to cutting-edge, anti-fraud research that’s accessible to all CFEs. The IFP will now be known as the ACFE Research Institute. ACFE members and other anti-fraud professionals are the beneficiaries.
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CFEs love fraud examinations that move in a linear fashion — from the general to the specific, gradually focusing on the perpetrator through evidence analysis. But life, of course, seldom moves in a straight line.
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Like it or not, networking is key to professional success. Unfortunately, keeping our heads down and doing great work just isn’t enough to further our careers. Here are tips from a wise introvert on how to build your network.
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When we have fewer emotional challenges, preoccupations and mental clutter we’re more actively aware of our surroundings. Our sharpened minds will be attuned to sights, sounds and other sensory input that can alert us to con artists’ attempts to hijack our emotions, our valuables and our dreams. Here’s practical information that you can give to your management, colleagues, families and friends.
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The dark web is often seen as a mysterious and malevolent creature — built out of the myths and legends created by popular media and clickbait headlines. In reality, the dark web is home to a vibrant and thriving criminal ecosystem with a resilient fraud trade at the center of the action. Here’s what fraud examiners should know when they enter the underbelly of the internet.
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Fraud examination is often challenging work, which involves various investigative skills. Be more successful in your engagements by focusing on these four traits that are shared by effective fraud examiners.
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Dating app maker sued for fraud, three parents sentenced in college admissions scandal and drugmaker targets dementia patients.
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As Emily Wilson, CFE, points out in her cover article, content on the dark web is designed to be hidden from search engines and from casual users. We can’t simply stumble across dark web sites by accident, Wilson writes. However, we might be surprised to learn that the dark web, which conjures images of abhorrent crimes, also stores legitimate common data and allows legal transactions.
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Fraud moves like waves globally — disrespecting borders and nationalities. However, regions often have common crimes and recurring problems. Here’s a review of some of what we’ve covered since the column’s inception in 2018 plus recent developments.
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Bernardin Assiene, CFE, found his passion for fighting fraud when he was tasked to investigate a financial fraud in the fuel distribution network at a major multinational American oil company in 1998. “The experience I gained and the lessons I learned shaped the rest of my career,” he says.
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A typical medical practice operates with controlled chaos, generous trust of staff and two separate financial accounting software programs — all breeding circumstances for fraud. Here’s how to identify internal fraudsters’ schemes and apply remedies (even if you don’t work at a medical practice).
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Think you’re completing your tax return? Think again. That frightening call from the Social Security Administration? Not who you think it is. And believe you’re getting the protection and settlement from the Equifax breach? Buyer, beware.
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ACFE student member and CFE shares her journey as a young professional navigating the collegiate to on-the-job path using the help of the ACFE.
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The ACFE has found that large, noteworthy fraud cases — like Enron or Bernie Madoff — will live on in infamy and can provide valuable lessons for fraud fighters. That’s why we, along with input from our members, have selected these five stories of 2018 as the most scandalous frauds of 2018. We chose the stories based on money lost, lives impacted and relevance to the anti-fraud profession.
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Janet O. Hicks, a member of the ACFE since 2016, died August 13, 2018. “She was a wonderful colleague with a warm and friendly personality,” said Professor Ned Benton, her mentor, in the August/September 2018 issue of the John Jay News.
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What really motivates people to be honest in business? That’s just one question economist Alexander F. Wagner is asking in his research. This University of Zurich professor will speak on some of his developing answers at the 2019 ACFE Fraud Conference Europe March 27-29 in Zurich.
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Pulitzer Prize-winning investigative journalist Bastian Obermayer isn’t afraid of investigating the global elite. He’s spent his career digging into the uncomfortable truths of Nazi war criminals, abusive Catholic priests and crooked politicians. Obermayer set into motion the largest collaborative event in the history of journalism when he initiated the Panama Papers. He’ll receive the ACFE’s Guardian Award and speak at the 30th Annual ACFE Global Fraud Conference in Austin, Texas, June 23-28.
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Burgeoning fraud against consumers is affecting millions. Two young investigative journalists at CNN recently reported an immense global mail fraud scheme targeting senior citizens.
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My career journey has been a wonderfully long and winding road through incredible roles in a wide range of industries. I’ve audited, investigated and led large global teams of people whose services kept businesses running, including IT, finance, human resources, marketing, procurement and more. I’ve been lucky enough to work with leaders and teams that have inspired me to learn crucial career lessons along the way. As I think about those lessons, I’ve distilled them down to my top three.
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Nigel Palmer, CFE, might be a native of Wales (and a dedicated rugby player), but he’s quite comfortable in the Middle East and Africa. As a former Royal Marines Commando, he learned strategies that he still applies to challenging fraud battles as security director at Mars, Inc.
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Organizations are expanding into promising emerging markets. But they’re often encountering market volatility, geopolitical risks, weakening currency and fluctuations, and complex local laws, which can cause fraud and corruption risks. Here’s how to avoid some pitfalls.
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Beware fraudsters who want to masquerade as your service providers. They’ll steal purchasing information, change bank account details and trick you into paying them.
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Cinema heists, fraudulent pet food and more.
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The initial exchange of the Panama Papers began at Bastian Obermayer’s parents’ home in Germany. His wife and kids were sick with stomach bugs, and he was graciously cleaning up one mess after another. In his words, it was a “really bad day.” He couldn’t know that one strange email would change his life, his newspaper and investigative journalism forever. The subject line read, “Interested in data?”
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A report on money laundering in Canadian casinos by drug-trafficking gangs exposes more than just gamblers showing up with bundles of $20 bills. Here’s a lesson for fraud examiners whose blinders might force them to focus on just one type of fraud.
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As your fraud risk landscape changes, so does the need to adapt and innovate. We explore how organizations are “operationalizing” anti-fraud innovation and continuous improvement.
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You’re ahead of the curve — you’ve filed your tax return early, but then you discover that a fraudster has stolen your PII and already filed one in your name. You’re a victim of the stolen identity federal income tax refund fraud scheme.
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We know how the Fraud Triangle helps explain the conditions that lead people to commit fraud. But what about the factors that could cause some to be predisposed to fraud? Here are some practical principles to consider when you’re working with fraud victims.
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Organizations continue to be at risk because their auditors and accountants often don’t know about, or continuously look for, fraud red flags. And they don’t apply additional audit procedures to offer reasonable assurance that financial statements are free of misstatements due to fraud. Let’s help them and engage everybody in this good fight.
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Investors and regulators are concerned that cryptocurrencies are highly susceptible to price manipulation. This danger is particularly pronounced for the hundreds of small, thinly traded “altcoins” that have popped up in the wake of the success of bitcoin and Ethereum. In February, the Commodities Futures Trading Commission (CFTC) issued an advisory warning investors that these small virtual currencies are targets for pump-and-dump schemes.
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Though fraud-risk teams worldwide don’t have psychics on staff (that we’re aware of), they can rely on predictive analytics to ascertain the future and assess the probability that third parties will commit fraud — or already have committed undiscovered frauds.
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Few fraudsters have marketed their schemes on social media as effectively as the organizers of the catastrophic Fyre Festival. They branded the event as “the cultural experience of the decade” for wealthy millennials who were willing to spend thousands of dollars for an exclusive VIP weekend.
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Leaders at all levels should daily use such high-level soft skills as collaboration, creativity, curiosity, problem-solving, communication skills, conflict management skills, strong work ethic, adaptability, social awareness, empathy, emotional intelligence (the arbiter between the rational brain and emotional brain) and clear self-expression (the ability to clearly express ideas, thoughts and opinions in a variety of media).
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Between 1998 and February 2009, accountant James T. Hammes embezzled more than $8.7 million from his employer, G&J Pepsi-Cola Bottlers Inc. He was indicted shortly thereafter on 75 counts — including 38 for wire fraud and 36 for money laundering — but wasn’t arrested until May 16, 2015. Why did it take so long to arrest Hammes? After the FBI had questioned him in 2009 about the theft, he left his family and life, and began hiking the Appalachian Trail (AT).
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A man in Los Angeles was determined to make a documentary that showed the anti-doping system in sport was a fraud. A man in Moscow helped construct that fraud. When Bryan Fogel and Grigory Rodchenkov met in 2015, neither could have guessed they’d land together in the middle of a dangerous geopolitical crisis that would expose decades-long corruption, shake up the Olympics and, ultimately, produce the riveting documentary, ICARUS.
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Whistleblowers are “in.” We regularly hear spectacular U.S. stories of employees blowing the whistle on organizations and receiving large federal payouts from prosecution of multimillion-dollar fraud cases. But what’s the whistleblower situation in Europe and, more specifically, my home base, Switzerland?
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App spam, terrorist financing via suitcases on flights and a psychic fails to see fraud in her future.
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Bryan Fogel has most likely never performed a ratio analysis on corporate financial statements or testified in court during a fraud trial, but the story he told through the Academy Award-winning documentary, ICARUS, resonates with what we do as fraud examiners.
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Did you think phishing campaigns were passé? Well, what’s past is prologue. Phishing attacks, which have increased 30 percent in each of the last three years, are still responsible for most data breaches. Here’s how to understand and prevent them from crippling your organization.
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Johanna Duenser-Mardook, CFE, who’s always loved solving puzzles, says the fight against fraud is a never-ending puzzle to identify missing pieces in cases or internal controls. As the vice president, business initiative fraud policy manager at Citi, Duenser-Mardook says she thrives on closing loopholes that help prevent serious damage to a person or business, financially or otherwise.
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You can’t escape blockchain. The topic’s in the media daily. It’s at the forefront of digital disruption and innovation discussions among leading businesses. We’ve seen blockchain technology applications in banking, currencies, supply chain, contracts and dozens of other areas.
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The Fraud Triangle is tried and true, but we might need more to understand our cases. The authors describe a “meta-model of fraud” that combines the “why-based” Fraud Triangle with the “what-based” Triangle of Fraud Action to better explain fraud cases. We might never know exactly why fraudsters commit crimes, but we can always gather facts and evidence to help prevent and deter fraud.
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Data analytics has been helping organizations detect fraud for years. But the future of fraud prevention and detection is looking toward new technologies, like artificial intelligence and machine learning, to stop fraudulent behavior before it costs companies millions.
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Employees who handle cash in small towns often have few safeguards, so it’s easy for fraudsters to abscond with millions over several years. Here’s how to prevent and deter these supposedly trusted and longtime staffers and how to prosecute them under federal laws.
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With the W-2 email phishing scam, the scammers ask payroll or human resources staff members for copies of W-2 forms for all employees. The forms contain a wealth of PII, including names, addresses, Social Security numbers, salary, wage and withholding information. The criminals use the pilfered information to file fake income tax returns and sometimes follow up with a request to wire transfer money to an account.
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Hundreds of anti-fraud professionals will gather at the 2018 ACFE Fraud Conference Middle East, Feb. 25-27 hosted at Jumeirah at Etihad Towers by the ACFE and Abu Dhabi Accountability Authority (ADAA).
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The ACFE scholarship award committee encourages all student members to apply for free main conference registrations to the 29th Annual ACFE Global Fraud Conference, June 17-22 in Las Vegas, Nevada.
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Learning these principles will help you distinguish between good and poor denials and make you a better fraud examiner, executive and decision-maker.
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Apart from drawing the scorn of industry regulators across the globe, Uber has been at the center of multiple fraud and workplace harassment allegations and numerous U.S. Department of Justice (DOJ) investigations. According to one Uber executive I talked to, who requested anonymity, the DOJ is conducting no less than six current investigations involving Uber.
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Whether you’re promoting your expertise to a potential client, marketing a product to a possible customer or pitching an idea to your manager (or your spouse), you should first pique their curiosity before moving forward. You do that with a value proposition or positioning statement. (Business types once called it a unique selling proposition, but most have set it aside for this term that promotes value instead.)
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The darknet is the latest example of technology that’s become a breeding ground for criminal activity. Combating virtual crime in this subset of the deep web is exceedingly difficult because of its anonymity. However, here are some ways law enforcement and fraud examiners are fighting these elusive miscreants.
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You might eventually work on an internal fraud examination within your global organization that could cross several borders. You can immediately assume, of course, that your examination will be byzantine. If you don’t possess expert knowledge on international laws, procedures and cultural norms you’ll have to add team members who do.
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In my November/December 2017 column I wrote that I’d like to share ideas on anti-fraud trainings and related issues to bring together practitioners, academics and students from around the world. Here I’ll focus on anti-fraud training needs in Europe. The International Anti-Corruption Academy (IACA) in Laxenburg, Austria, was formed to overcome shortcomings in anti-fraud knowledge and practice.
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Student loan fraud, tighter enforcement on robocalls and college email phishing on the rise.
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Depositions are grueling. Let’s say you’re an expert witness for the defense. As you walk into the conference room of the plaintiff’s counsel your heart rate ascends, your palms sweat and you reach for a glass of water as you sit at the table. You know what’s coming: incessant, pointed questions from attorneys as you give sworn testimony. You also know that all parties will use your words in court as evidence or as weapons to attack your inconsistencies.
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“I’ve often said in mentoring staff that no matter how smart you are, no one’s successful without someone else giving them a hand up the ladder of success,” says Tom Golden, CFE, CPA. Golden, a professional speaker, author and retired partner at PricewaterhouseCoopers (PwC), now focuses on speaking engagements and the debut of his new novel but says he owes a debt to all who have helped him during his professional career.
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Compliance professionals’ ultimate objective is a world in which employees receive only trainings and communications that are relevant to their roles, at exactly the right time (before they encounter compliance issues that require their attention) and in the right amount.
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Kelly Richmond Pope, Ph.D., CFE, CPA, an associate accounting professor, has produced and directed a riveting documentary, “All the Queen’s Horses,” about Rita Crundwell’s historic $53 million embezzlement from the city of Dixon, Illinois.
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Ransomware, which morphed from scareware fraud around 1998, isn’t abating. Fraudsters are still holding electronic devices ransom with creative variants and extorting money and personally identifiable information. Here are some of the historical and current developments plus ways to help others avoid ransomware.
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New and different concepts can cause fear or hesitancy. However, biometric ID is no longer new and different; it’s proved efficient, effective and secure. The technology is part of everyday life for those younger than the baby-boom generation and probably for most baby boomers. Organizations that offer financial aid could increase security and a protection against fraud in their application processes by requiring a combination of a thumb and/or fingerprints plus numeric passcodes such as Social Security numbers.
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Don’t let your performance suffer as an expert witness during a deposition because of an overbearing attorney asking the questions. Here are tips on how to keep your cool and do a great job for your client.
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It’s all connected. From comic-book enthusiasts to conspiracy theorists to new-age acolytes — many believe that those seemingly random dots do connect. And now the “Internet of Things” (IoT) might start us down that road.
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ACFE Regent Emeritus Joseph R. Dervaes, CFE, gave his final presentation and awarded the Pacific Northwest Chapter’s scholarship, renamed in his honor, at the chapter’s first hybrid annual fraud conference and the latest edition of the Fraud Risk Management Guide helps fraud examiners keep apprised of the latest threats and the multiple ways they can tackle them.
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Fraud examiners shattered Global Fraud Conference attendance records in Seattle, Washington, cementing ACFE’s hybrid virtual and in-person annual conference as a can’t-miss event. And keynote speakers shared their stories of investigating fraud and corruption and revealing the truth.
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The COVID-19 pandemic resulted in an increase in remote and hybrid work that has many managers concerned about declining productivity levels. Here we examine the latest buzzwords associated with the trend, how executives and employees are coping in this new environment, and whether “stealing time” is a fraudulent act.
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Members of the ACFE Board of Regents always bring a wealth of experience from their respective sectors. Here they impart their thoughts on an array of topics and the importance of continual learning in the ever-evolving anti-field field.
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The over $4.5 billion theft from Malaysian sovereign wealth fund 1MDB is one of the world’s biggest-ever financial scams and a sad story as it deprived ordinary people in that country of vital resources. Xavier Justo talks about his nightmare experience exposing the fraudsters responsible for this massive theft and the lessons he’s learned along the way.
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Proving someone is lying, let alone getting them to confess, is difficult to say the least. Let’s face it, fraudsters are slippery characters and adept at the art of deception. Here David Lieberman, Ph.D., a psychotherapist and an expert in the field of human behavior, helps us understand the signs of deceit and how to get a confession.
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Access/identity control is a fundamental component of data security that dictates who’s allowed to access and use company information and resources. But organizations still lack the necessary protections, opening the door for fraudsters to exploit their systems. Here the authors examine the latest IT resources to keep such criminals at bay.
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In California a man conducted a cow manure Ponzi scheme; a former Amazon manager is sentenced for stealing millions from the company; and fraudsters in India scam victims by posting fake business numbers online.
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Incoming ACFE President John Gill, J.D., CFE expresses gratitude for outgoing ACFE President and CEO Bruce Dorris, J.D., CFE, CPA.
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Understanding ChatGPT and similar generative AI tools is critical for fraud examiners seeking to leverage this emerging technology. Here we explore the risks and the extraordinary potential of this new phenomenon.
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In a world rife with scandals impacting all aspects of business and life, internal auditors aren’t immune to bad behavior. Here’s how to find their occasional crimes and misdemeanors, plus some practical measures to deter and detect their nefarious activities.
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Don’t send in the clones! Fraudsters are using ChatGPT to replicate voices to pull off classic grandparent and family-emergency scams. And beware of this new fake income-tax refund scam.
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The ACFE Foundation has awarded $85,000 in funds to the recipients of the 2023-2024 Ritchie-Jennings Memorial Scholarship. Twenty-three university students from across the U.S., Europe, Asia and Africa received scholarships ranging from $2,000 to $10,000 for demonstrating academic achievement in a fraud-related field of study and a desire to pursue a career in fraud examination or similar anti-fraud profession.
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Economic shifts, crypto deposits, weak controls and incompetent administration have led many tech-heavy banks to bite the dust this year. But none of the institutions’ C-suiters should’ve been caught flat-footed. Since the Great Depression, risk management has been the mantra of the money world. And we know that complacency and hubris can lead to fraud. Here’s how the bank collapsed and reminders for organizations to get it right.
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At 2:07 p.m. on Friday, Nov. 22, 1963, the New York Stock Exchange (NYSE) halted trading shortly after news broke that U.S. President John F. Kennedy had been fatally shot. The market had been on a downward slide, losing $11 billion in capitalization in the previous seven minutes. But hours before Kennedy’s assassination, NYSE president G. Keith Funston was doing all he could to prevent a potential market crash as one of the largest futures commodities scandals of the 20th century started to unravel.
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Trade compliance professionals help protect companies, but they also play a role in safeguarding national and global security. This emerging field offers exciting career opportunities for CFEs whose skill sets are a great match for companies that need professionals who can prevent and detect trade violations that threaten real harm.
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Michael Horowitz, the inspector general of the U.S. Department of Justice, has earned a reputation as a straight shooter and an adept investigator. He talks about his latest role as chair of the Pandemic Response Accountability Committee, mistakes made during the disbursement of COVID-relief money, how to avoid a repeat performance of the resulting fraud fiasco and the importance of strictly sticking to the facts.
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Everyone has personal biases, but letting these biases color our views of a suspect can affect the integrity of fraud investigations. Here we explain what unconscious biases are and what fraud examiners can do to overcome them.
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Cases of document fraud, including check fraud, have exploded in recent years. The authors explain what’s behind the proliferation of this age-old scam and the modern technology CFEs can employ to stop it in its tracks.
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A Manhattan construction company fakes diversity hires to win government contracts; Jalisco drug cartel members scam elderly U.S. citizens with timeshare scam; and the U.K. government fights fraud with new investigative team.
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ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, praises Cressey Award winner Michael Horowitz's achievements in detecting and preventing fraud in his role as inspector general and chair of the Pandemic Response Accountability Committee (PRAC).
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M. Brian Reid, CFE, says that in a parallel universe he might’ve been a nuclear physicist. But the CEO of Brison LLC applies the same passion he has for exploring the mysteries of the universe to examining the complexities of fraudsters and their schemes against his business clients.
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The line between corporate crime and geopolitics has become increasingly blurred as the U.S. sanctions a broad range of bad actors across the globe. Organizations can quickly find themselves in violation of these rules. Here’s how fraud examiners can use one type of technology to prevent this fraudulent behavior.
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All organizations have employees who are so smart, energetic and indispensable that they can manage integral functions without close supervision. But some of these “Radars” will succumb to their freedom and rob you blind.
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As if finding gainful employment isn’t hard enough, job seekers now must be wary of scammers posting false advertising to steal their money and personally identifiable information. Here we look at why employment scams are on the rise and how to spot the red flags.
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Using a computer these days is fraught with fraud risks. That ad about artificial intelligence may be interesting, but a click on the wrong website and you could be hacked. Here are some tips to avoid malware and having your personal identifying information stolen.
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When Andi McNeal, CFE, CPA, was in graduate school finishing up her master’s and researching doctorate programs, she read an article written by Dr. Joseph T. Wells, CFE, CPA, founder and Chairman of the ACFE, in the Journal of Accountancy that mentioned the fraud examination course he was teaching at the University of Texas at the time. “I was trying to find a path to focus my doctoral studies on fraud — the intersection of accounting and human behavior has always fascinated me — and I ended up emailing Dr. Wells to find out if he had any suggestions or guidance about where I could find a Ph.D. program in white-collar crime,” she says.
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More than 3,000 anti-fraud professionals gather at the largest anti-fraud conference in the world to power up their knowledge, networks and careers.
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The $35 million “Fat Leonard” corruption scandal threatens to decimate an entire generation of experienced U.S. Navy officers. What unfolds is the rise and fall of the defense contractor who bought off Navy brass with meals, liquor, women and bribes.
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The ACFE Board of Regents offer their counsel and ruminate on the dynamic anti-fraud profession during the 29th Annual ACFE Global Fraud Conference.
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Once someone is entrusted in a fiduciary relationship, an opportunity is created for that person to become less trustworthy, or worse, a thief. Whether structuring a new fiduciary role to prevent fraud or investigating fraud after it has occurred, breaches of fiduciary duty are great sources of work for fraud examiners.
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When corruption thrives and dirty money is kept in offshore accounts, Africa’s high levels of poverty remain. How do we reverse the trend? The solution lies in reviving countries’ primary educational standards and increasing fraud awareness and education.
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Sports-memorabilia fraud, and cheating and housing scams.
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Fraud examiners have implemented codes of conduct and compliance programs for decades in their organizations and agencies. Management challenges them to measure the returns on those programs and add an adjective like “integrity” to a list of potential fraud risks. But the overarching question is, “Are our people doing the right things at the right times for the right reasons?”
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A recurring theme of scandals bringing down Iceland prime ministers illustrates citizens’ intolerance toward corruption. Yet are attitudes, protests and political repercussions enough to reverse the trend of worsening corruption in Iceland and other Nordic nations?
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The ACFE presented Dave Cotton, CFE, the Certified Fraud Examiner of the Year award at the 29th Annual ACFE Global Fraud Conference in June. Cotton, who’s the chairman at Cotton & Company, LLP, has played a significant role in developing best practices in anti-fraud controls.
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This article explores how to assess the strength of an organization’s integrity capabilities and operationalize integrity processes with contributions from Professor Eugene Soltes, Ph.D., of Harvard Business School, plus Jon Feig, CPA, and Andrew Reisman, J.D., of Ernst & Young LLP’s Forensic & Integrity Services practice.
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Technology futurist Martin Ford ponders how job losses and stagnant wages can lead to an increase in fraud, waste and abuse. His research indicates that anti-fraud professionals would do well to become amateur seers.
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Fraud examiners should consider an enhanced set of Fraud Triangle factors for executives: greed, pride and entitlement. But the question remains, why do these behaviors manifest in executives who might be associated with fraud?
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Bluetooth can connect your phone to your car so that you can use the car’s stereo system. But vulnerabilities expose users to crooks wanting to steal personally identifiable information (PII). The column also covers phone hacking, another popular method of stealing PII.
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In any organization, tone at the top matters. Leaders who emphasize teamwork without building a strong ethical foundation risk creating an environment prone to collusive fraud. The author offers advice for mitigating collective rationalization and reducing the risk of collusive fraud within a corporation.
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Old password habits die hard, but clinging to your weak password might be the death of your account. The author examines the growing threat of account takeover and considers the effectiveness of the most common security practices.
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SEC, FBI, DOJ join forces to bust crypto fraudsters and more
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In 1995, the Association of Certified Fraud Examiners (ACFE) hired a young editor named Dick Carozza, CFE, to turn a newsletter into a magazine. It’s three decades later, and Fraud Magazine is set for another transformation. This is our last printed issue as we tackle a new assignment: delivering the latest fraud prevention and detection content in a digital-only format.
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Fraud Magazine has always been in a state of transformation, from its start as a simple newsletter to a glossy magazine. Now, the magazine is making another big change as a digital-only publication.
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Gabriella Marshall, CFE, major case consultant at Nationwide Insurance, discusses the benefits of earning the Certified Fraud Examiner credential, her professional background, her greatest achievement and more.
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The JFVP gives fraud victims who lack resources a shot at justice.
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Who monitors and oversees high-risk transactions in your organization? In this article, I explore who owns transaction and controls monitoring for vendors, customers and employees.
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The Evergrande Group, one of China’s largest property developers, recently went bankrupt and was liquidated because of excessive borrowing, mismanagement and alleged financial misreporting. In this column, the author conjectures that behavioral and data analytics could’ve gone a long way in detecting and preventing this scandal.
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Fraudsters work year-round to perpetrate their schemes. Fraud Magazine also works year-round tracking the news for those schemes we believe will live in infamy and serve as cases for anti-fraud professionals to study for years to come. Here are the most scandalous frauds of 2024.
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In 2021, Troy Gochenour became a victim of cryptocurrency fraud after striking up a correspondence with a scammer he met on a dating app. The Ohio-based voice actor talks to Fraud Magazine about his experience as a fraud victim and how it transformed him into an activist raising awareness and fighting against cyber scams.
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The ACFE, the world’s largest anti-fraud community, continues to thrive in an increasingly challenging environment, growing its membership, expanding its presence across the globe and becoming more diverse and inclusive. That’s the message from the most recent ACFE Report to Members.
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Rapid changes in technology have meant that work environments now demand faster decisions at all levels, creating the type of conditions where fraudsters thrive. Here we look at how organizations and fraud examiners can best face these challenges in an increasingly agile age.
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Just weeks after OpenAI, a U.S. artificial intelligence (AI) research laboratory, launched ChatGPT in November last year, the U.S.-Israeli cybersecurity firm Check Point noticed a spike in dark web conversations. The AI chatbot has astounded, but also unnerved, the public with its ability to do many human tasks from coding to passing an MBA-level exam to writing flawless text. However, in a popular hacking forum, a post entitled “ChatGPT – Benefits of Malware” described how one fraudster used the AI tool to recreate malware strains, such as so-called stealers that infiltrate computer systems, search for specific types of files and then remove those files without the owners’ knowledge. While the creation of malware is nothing new, the discussion on the dark web was disturbing because, as Check Point notes, its apparent purpose was to show less tech-savvy fraudsters that they too could use ChatGPT to code for malicious purposes. (See “Cybercriminals starting to use ChatGPT,” Check Point, Jan. 6, 2023.)
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Miranda Patrucic has exposed corruption across Central Asia and in Europe. The award-winning journalist talks about her experiences and the challenges she’s faced in tracking down corrupt officials across the globe and why they still evade the law.
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When an accountant raised questions to his organization’s management in 2016 about the possible manipulation of employee remuneration at an Indonesian mining operation, little did he know that he was pulling the string that would unravel a larger fraud scheme involving top executives. Once discovered, though, the fraudsters’ downfall came quickly.
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Many U.S. businesses willingly defrauded the government’s Paycheck Protection Program loan program. But PPP’s byzantine procedures, applicants’ mistakes and some banks’ disinterest might have inadvertently caused well-meaning applicants to receive money they shouldn’t have. Now investigators must sift the wheat from the chaff.
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Former Goldman Sachs banker Roger Ng receives jail sentence for money laundering and violating anti-bribery laws; in Chicago a woman used information stolen from dozens of dead people to defraud the government of over $45,000; the Texas Department of Public Safety (DPS) left 3,000 Asian Americans vulnerable to identify theft by unknowingly sending multiple driver’s licenses to a New York-based Chinese crime group.
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While fraud examiners are hard at work keeping their organizations safe from scammers and other criminals, they must also think about how their loved ones can fall victim to fraudsters’ wily ways. Here we interview CFEs about how they keep family and friends safe.
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Barry Tong, CFE, wanted to be an accountant ever since he was in secondary school, but it wasn’t until he joined a Big Four firm’s insolvency and restructuring department that he became interested in fighting fraud. Now, Tong spearheads fraud investigations as Grant Thornton China’s national leader of Forensic and Investigation Services (FIS) based in Hong Kong.
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What are the telltale signs of an improper payment? Here we explore the leading research into what can be measured and observed to find common patterns and profiles around improper, and sometimes corrupt, payments.
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Identifying and finding people efficiently online is a useful skill for fraud examiners, business investigators and due diligence professionals. Many cases require us to follow paper and money trails by searching for subjects, potential witnesses and former employees, who are generally more willing to speak about their workplaces and colleagues than current employees.
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Charles Cullen, a former registered nurse, is serving 11 consecutive life sentences for murdering 29 patients in 16 years at New Jersey and Pennsylvania hospitals. The author, who helped investigate the case, shares organizational deficiencies that have helped him in subsequent fraud investigations.
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“Corruption is an integral part of humanity,” says investigative journalist Miranda Patrucic in this issue of Fraud Magazine. It’s a sad summation, but it rings true. According to the ACFE’s Occupational Fraud 2022: Report to the Nations, corruption was indeed the most common fraud scheme in every global region we surveyed. Thank goodness the public has strong journalists like Patrucic, the focus of our cover story and the recipient of the ACFE’s Guardian Award, which we’ll present to her at the 34th Annual ACFE Global Fraud Conference in Seattle, June 11-16. The award honors journalists whose determination, perseverance and commitment to the truth have contributed significantly to the fight against fraud.
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Prior to the U.S. Veterans Day holiday, Winston Mittens, a retired Army staff sergeant, answered a call from someone who said he worked at Mittens’ bank. The caller said the bank was beefing up its security, so it needed Winston to verify his account information and Social Security number, which he did. But in the next week, Winston visited his bank to deposit a check and found he had a zero balance in his account. A bank official told Winston that someone had used his identity to steal his banking credentials and drain his money. Lucky for him, the bank covered the fraud and restored his balance. The bank also changed his account credentials so he hopefully wouldn’t be a victim again.
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"Hello. This is John Wilson calling from the Federal Reserve Bank of New York Grants Department. You have been selected to receive a $9,000 federal grant based on your clean criminal history and the fact that you have paid your taxes on time. To claim your grant is very simple. You will need to pay a $250 processing fee to the Federal Reserve Bank of New York …” Would you have hung up?
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ACFE Austin Chapter officers presented a proclamation from the Austin, Texas, mayor naming March 31, 2018, “James D. Ratley Day” to Ratley on the front porch of the historic Gregor Building at the ACFE Headquarters.
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Wildlife trafficking has been defined as “any environment-related crime that involves the illegal trade, smuggling, poaching, capture or collection of endangered species, protected wildlife (including animals and plants that are subject to harvest quotas and regulated by permits), derivatives, or products thereof.” The Convention on the International Trade in Endangered Species of Wild Flora and Fauna (CITES) bans wildlife trafficking.
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Certified Fraud Examiners elected Ryan C. Hubbs, CFE, CIA, CCEP; Tony Prior, MBA, CFE; and Elizabeth Simon, CFE, CPA, to the 2018-2019 ACFE Board of Regents from nine candidates selected by the ACFE Nominations Committee. Hubbs, Prior and Simon took office at the board’s meeting in February at ACFE headquarters in Austin, Texas.
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U.S. public pension plans are facing an unprecedented crisis with an estimated shortfall of $1.378 trillion needed to pay benefits to retirees. Most pension funds have taken on higher-risk investments to seek increased returns. The rise and fall of the Dallas Police and Fire Pension System because of these non-traditional investments provides a cautionary tale with important lessons for CFEs.
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In the January/February issue, we examined how Uber and its competitors have changed the hired car industry — and thereby changed the industry’s fraud profile. Here in part two, we take a deeper dive into some of Uber’s fraud, ethics and compliance issues that the business and mainstream press highlighted in 2017.
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The Fraud Triangle has long illustrated the core principles of the ACFE’s training in understanding how fraud occurs. Here the authors suggest a revised Fraud Triangle that considers a more detailed look at a fraudster’s personal characteristics in addition to the rationalization component of the original triangle.
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In our cover story, author Robert Tie, CFE, says Merriam Webster’s Thesaurus offers such synonyms for “whistleblower” (for obvious reasons, we prefer “sentinel”) as “betrayer,” “rat” and “snitch.” And he writes that these aren’t just words in a book; they’re manifestations of beliefs that incite and legitimize retaliation for perceived breaches of trust.
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Africa’s environment promotes corruption because of its reliance on skimming, bribes and asset misappropriation within governments that are ineffective and can’t provide services and resources to their populations. Some countries in Africa have the highest levels of corruption in the world according to the Transparency International’s Corruption Index of 2016.
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Initial coin offerings (ICOs) are a recent phenomenon used for funding companies that are developing new digital currencies and associated technologies. However, companies offering ICOs are often eager to skirt securities regulations and disclosure requirements, leaving potential investors with vague or misleading information — and fraudsters with new opportunities.
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Jadon Fox, CFE, head of fraud control services at Taylor Fry, has analyzed countless transactions using sophisticated technologies and techniques, but he’s most proud of his relentless pursuit of dreams that live outside of the office. “My wife and I’ve always wanted to live overseas,” says Fox. “So, six years ago we sold our dream house, traveled 9,000 miles from home, settled in Australia where we knew no one and I began a job at Commonwealth Bank.”
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Initial coin offerings (ICOs) are a recent phenomenon used for funding companies that are developing new digital currencies and associated technologies. However, companies offering ICOs are often eager to skirt securities regulations and disclosure requirements, leaving potential investors with vague or misleading information — and fraudsters with new opportunities.
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Fraud examiners and compliance professionals have used continuous monitoring with evidence-based, anti-fraud prevention and detection analytics programs for many years. Historically, the volumes of data generated by businesses have far outpaced the ability of risk-oriented business functions to manage that data, and the inherent risks evident within it, but this is changing.
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I was interested in the psychological aspects of fraud, so I conducted research that delved into the pressures and rationalizations of employees, which are closely linked with employee happiness and job satisfaction. I examined these in the context of a local non-governmental organization (NGO) in a developing country in Southeast Asia.
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Why do we have so much trouble preventing and deterring fraud across borders? You know the answer: lack of cooperation. However, most European law enforcement organizations don’t want to compete with each other. They want to help each other deter and prevent crime. But they need some overarching force to help them work together. That’s where Rob Wainwright and Europol come in.
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The grandparents' scam, which began about 10 years ago, is still claiming victims regardless of alerts from the media and government agencies. I’ve reported on this scam, but it’s important to address it again because fraudsters, of course, have devised a new-and-improved version that makes the voices of the targeted “grandchildren” even more believable.
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Fraud Magazine recently spoke with veteran CFEs Ján Lalka in the Czech Republic, Jonathan T. Marks in the U.S., and Sean McAuley in Scotland about how fraud examiners can help organizations develop secure, workable whistleblowing programs. This article explains why they're essential and, in some cases, a matter of life and death.
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"We don't have a lot of fraud." This unrealistic, and in my experience common, sentiment can lead to costly and disastrous outcomes. The fact is, organizations don't know how much fraud they have because fraud is invisible until they discover it. If you assume you have very little fraud, you'll pay for it.
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Tax fraud, new Facebook news feed and more
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Fraud Magazine examines how U.S. Attorney Damian Williams is leading the fight against financial fraud and public corruption from one of the most influential federal prosecutorial offices in the United States.
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In recent years, stories of company founders committing fraud have proliferated in the news. By examining high-profile cases, the author identifies patterns and key takeaways for CFEs to better understand this seemingly all-too-common phenomenon.
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White-collar criminals are adept at manipulating and exploiting the goodwill of others to carry out their schemes. Recognizing and understanding these behaviors are important ingredients in the fight against financial fraud. In this article, the author details criminal thinking traits through case studies of some of the most infamous white-collar fraudsters and provides strategies and tools that fraud examiners can use to recognize those traits.
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The use of real-time deepfakes, where fraudsters use video or audio generated with artificial intelligence to replicate someone’s voice, image and movements as the scheme is happening, is the latest way that fraudsters are perpetrating a host of frauds. In this article, the authors describe real-time deepfake schemes and what can be done to combat them.
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Fraud fighters recognize the ACFE’s Report to the Nations as the premier study of occupational fraud. ACFE CEO John Warren, J.D., CFE, takes readers on an in-depth tour of the 13th edition of this comprehensive report of occupational fraud, its perpetrators and victims, and its costs to help anti-fraud professionals better protect their organizations against this pernicious economic crime.
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Whether you call it “friendly fraud” or a chargeback, refund fraud and abuse is on the rise and costing retailers billions. The author discusses what this fraud entails, what’s behind its growth and why this decidedly unfriendly scheme is so frustrating to fight.
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Four women in England are victims of a romance scam; Yvette Wang, former chief of staff to accused fraudster Guo Wengui, pleads guilty to conspiracy to commit wire fraud and money laundering; and a mortuary worker in Arkansas pleads guilty to stealing human remains and selling them to a man she met in a Facebook group.
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ACFE President John D. Gill, J.D., CFE, gives a behind-the-scenes look at the making of the CFE Exam.
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At one time an aspiring artist, Association of Certified Fraud Examiners (ACFE) Board of Regents Chair Natalie Lewis, CFE, CPA/CFF, now investigates alleged employee embezzlement and business fund misappropriation schemes. She works to combat fraud locally and globally in her leadership positions for the City of Atlanta and the ACFE.
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CFEs, lawyers and auditors – be on alert! The proposed PCAOB’s amendments to its auditing standards related to an auditor’s consideration of a company’s noncompliance with laws and regulations about financial statement audits will have a profound impact on our profession, bringing fraud risk management front and center.
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Whether you’re drawn into a case as a fraud examiner, an auditor, or a customer encountering identity fraud, understanding credit risk modeling within financial organizations is essential. This knowledge is crucial regardless of your role because it impacts how financial products, from bank accounts to mortgages and student loans, are managed and secured globally. Appreciating how financial institutions assess the risks tied to each customer — whether an individual or a corporation — is fundamental for anyone engaged with financial services. This understanding shapes how we perceive the safety and reliability of financial products that affect everyday financial decisions.
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In March, a U.S. district court shut down a student debt-relief operation that stole $8.8 million in junk fees from school debtors. Here we detail how others can avoid falling victim to scams that claim they’re helping people pay off their student loans. And a recent data security report sounds the alarm on organizations sharing data internally.
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Generations that grew up with the internet aren’t immune to online fraud schemes. Trust in online platforms, heavy involvement in social media and financial pressures facing Gen Z and millennials put them at greater risk of being victimized by fraudsters than older adults. Fraud Magazine explores how younger generations become victims — and perpetrators — and what fraud examiners can do to educate them about fraud.
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Certified Fraud Examiners (CFEs) earn 17% more than their non-certified counterparts, and 62% report being happy on the job. These are just a few of the insights from the Association of Certified Fraud Examiner’s (ACFE) 2022 Compensation Guide for Anti-Fraud Professionals, which also revealed a slow trend toward gender diversity in the anti-fraud profession and changing workplace habits since the COVID-19 pandemic.
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Imagine for a minute that you’re an Air Force pilot flying the fighter jet F-16CM Falcon and you’re returning to base after a nighttime training mission. While attempting to touch down on the runway, you discover that your landing gear is damaged. You execute a go-around and try to land again, this time by having the plane’s tailhook catch an arresting cable. That fails too, and the wing touches the runway. As the plane starts to crash, you reach down and pull the ejection handle, which releases the canopy. An explosive cartridge launches your seat over a hundred feet into the air. But your parachute fails to deploy, and you realize you’re about to slam into the ground, still strapped into your seat, with only a fraction of a second to go before your death. How could a scenario like this happen? Once an ejection handle is pulled, it triggers an almost instantaneous sequence of events aimed at getting the pilot safely to the ground. But in this real-life example of the potential dangers of product substitution, an Air Force investigation later revealed that the failure of the seat’s digital recovery sequencer (DRS) — which controls the timing of the ejection — contributed to the pilot’s death. Not only that, but the electronic components inside the sequencer were reportedly counterfeit, even though the F-16 manufacturer maintained the strictest quality controls over its subcontractors that built the ejection seat and the DRS.
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Growing up, we all tried at some point or another to squirm our way out of being accountable for something we shouldn’t have done or said. (I admit to throwing my little brother under the bus a couple of times, but my parents were wise to that approach.) We spun the facts or rationalized our action to avoid punitive measures; in short, we wanted to preserve our standing in the family unit and stay in Mom and Dad’s good graces. But alas, many of us suffered some parental wrath as a consequence for our behavior — and the fictitious tales we told to rationalize it. Our parents knew something we kids didn’t fully appreciate: Rationalization allows us to wander further away on the far side of truth. As adults gaining experience in our respective professions, we learn about compliance and ethics, but we also add to our repertoire of rationalizations.
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When sailing, mariners must always know the wind’s direction and mind their points of sail — a boat’s course relative to the wind. Sails can’t catch the wind in what is known as the no-go zone, approximately 45 degrees on either side of the wind’s direction. But sailing close-hauled, or as close to the wind as possible, mobilizes sails. (See “What is Sailing Close to the Wind?” Life of Sailing.) Indeed, sailing requires working with the wind to move ahead. Managing fraud risk and investigations is a similar process: Just as the mariner works with the wind, collaboration among teams of experts is the best way to propel forward. When people come together and share their expertise, they can truly succeed.
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In March 2019, former New York Lt. Gov. Brian Benjamin, at the time a state senator, asked a real estate developer to help procure a number of small-dollar contributions for his latest political campaign. Benjamin’s unnamed contact, who also led a nonprofit organization, later told investigators from the U.S. Department of Justice (DOJ) that he initially rebuffed Benjamin’s request for several reasons: He didn’t have experience “bundling political contributions” in that manner; he was focused on fundraising for his own nonprofit; and any potential donors he could target were the same ones from whom he intended to solicit contributions for the nonprofit. (See “New York Lieutenant Governor Brian Benjamin Charged With Bribery And Related Offenses,” DOJ press release, April 12, 2022.)
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In the U.K., a man is arrested for attempting to sell a house he was renting; tech workers in Southeast Asia are conned into working for cybercrime rings; a 58-year-old woman receives a prison sentence for heading one of the biggest marriage fraud conspiracies in U.S. history.
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Kathryn Wilson, CFE, learned in high school that accounting encompasses so much more than crunching numbers — it’s also about following the money. And accounting isn’t just a job for Wilson, who conducts risk assessments and devises ways to prevent fraud as a senior manager in CohnReznick’s government and public-sector group; it’s also a family affair with her two brothers and late grandfather in the profession.
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Today’s world is fraught with geopolitical sanctions, fraud, corruption and cyber warfare, and fueled by rapidly emerging technologies that continue to change how we approach business and risk mitigation. Companies large and small are enduring a costly, but necessary, shift to digital, while transitioning operations to the cloud and scrambling to protect their systems from intrusion. With change comes risks, which is why companies often look to anti-fraud and/or forensic technology professionals to help them build the preventive and detective anti-fraud controls needed to protect their business and align with regulatory expectations.
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Medicare Advantage, the private-sector arm for elderly care, is fast becoming the new battle front in the fight against health care fraud in the U.S. Here's why, and what fraud examiners think should be done.
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It’s hard to believe, but it’s been almost three years since the start of the COVID-19 pandemic, and fraud fighters are still grappling with the fallout of frauds tied to government-relief funds. Yet, despite the massive scale of pandemic frauds and the staggering loss of money, governments made some progress after enacting task forces to investigate COVID-related frauds and recover stolen funds. And while some of the most scandalous frauds of 2022 were connected to the pandemic, it wasn’t all COVID all the time. Indeed, there were plenty of other frauds we believe will live on in infamy and serve as essential case studies for fraud examiners in the years to come. (See “Justice Department Announces COVID-19 Fraud Strike Force Teams,” U.S. DOJ press release, Sept. 14, 2022 and “Secret Service recovers $286 million in stolen COVID relief funds,” by Julia Ainsley and Sarah Fitzpatrick, NBC News, Aug. 26, 2022.)
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Fraud, waste and abuse emerge in most areas. But, theoretically, the health care system is where most people should least expect them. Of course, fraud has long been a problem in this sector. And most recently Medicare Advantage — the private-sector arm of the U.S. national health system for elderly Americans — and the insurers that manage it have come under intense scrutiny for allegedly submitting false diagnosis codes to inflate payments from the government.
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Kerry Binder thought of herself as a real computer jock. When she had a problem with her computer that she couldn’t solve, she contacted the Geek Squad, retailer Best Buy’s tech support service, for help. One day she received a text message saying she’d been charged hundreds of dollars to renew her Geek Squad membership. She knew nothing about this and thought that this was an error. The text message said Binder could dispute the charge or cancel her membership by calling a phone number within 24 hours. When she made the call, a scammer told her that he had to gain remote access to her computer to help her. When he’d finished rummaging around in her computer, he told her that he’d corrected the error and apologized for the mistake.
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As protests raged in Chile in 2020 over the cost of living and inequality, the government sought to procure body cameras for the police to monitor events on the ground. After going through a public bidding process, U.S. telecommunications equipment provider Motorola Solutions won the business to supply 300 cameras at a cost of close to 400 million Chilean pesos, or about $340 each at today’s exchange rate. Soon thereafter, those involved in the bidding process found themselves under investigation for irregularities. According to the local press, government officials accepted Motorola’s bid even though the company submitted its offer on the electronic procurement portal outside the hours stipulated by the bid rules. (See “El informe de Contraloría que complica a Katherine Martorell, la actual vocera de Sichel, por millonaria compra de cámaras GoPros para Carabineros,” El Mostrador, Oct. 15, 2021.)
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There’s a good possibility you’re a Certified Fraud Examiner. But you’re probably not a licensed private investigator. Are you missing out? Not necessarily, but some CFEs believe their hard-won PI skills burnish their fraud examiner careers and make them better professionals.
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When I started my career as a CFE, my background had been primarily in auditing and accounting, and most of my cases were corporate matters. Fraud victims were usually corporate entities looking to quantify a loss and mitigate the lapse in controls. I rarely encountered an individual who suffered a real loss because of a fraud scheme.
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Six candidates have been selected to compete for two positions on the 2019-2020 Board of Regents. The board sets standards to promote professionalism and to ensure the reputation of the CFE credential.
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Ileana Colón Carlo, a member of the ACFE Board of Regents from 1995 through 1996, and comptroller of Puerto Rico from 1987 to 1997, died March 19 at age 69.
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Nirav Modi supposedly was one of the richest men in India. He came from a respected family and had close connections to the government. Could he really have pulled off a huge banking fraud to finance his business ventures?
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Consider keeping investigative charges within corporate security and other anti-fraud functions. You might then increase reporting of fraud and other crimes.
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This case involved a Nigerian crime ring that stole Apple computers and devices by impersonating U.S. defense officials. Make sure purchase orders pass the “smell test,” and call agencies to confirm.
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Contract and procurement fraud, collusion and corruption can rob profits from victims. Bid riggers conspire to eliminate fair and open competition and allow some to monopolize industries. Here’s some help in detecting common contract and procurement fraud schemes, and improving the integrity of the contract-award process.
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ACFE founder and Chairman Dr. Joseph T. Wells, CFE, CPA, is among professionals named this year’s Most Influential People in Security by Security magazine.
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Digital analysis and search apps are invaluable. But nuanced interviewing, with an eye to discerning audiences, can yield solid evidence.
Published in Fraud Magazine
Scandal at the Vatican, health scams and ex-Enron CEO Jeffrey Skilling released from prison to a halfway house.
Published in Fraud Magazine
Most of our event speakers instruct from the knowledge they have in specific areas of fraud examination. But Kathe isn’t trained in law enforcement, auditing or compliance. She’s someone who noticed something wrong and had the guts and determination to shine a light on it.
Published in Fraud Magazine
It’s a familiar story. A country or region finally is prosperous, but inevitably fraud and corruption increase. Here are some infamous South Asian cases and ways the region has battled what affluence wrought.
Published in Fraud Magazine
Fighting fraud for Erik Anderson, CFE, is so much more than conducting an examination. “I fight fraud by making sure what we’re doing is right,” says Anderson. “Whether I’m on the front lines of an investigation or using the principles of a fraud examination to better understand the risk to the organization, being a good fraud examiner is about challenging yourself to stand up for what’s right and seeking that out with passion.”
Published in Fraud Magazine
New developments in forensic data analytics are breaking down traditional barriers to access, transparency and usability. You don’t need an advanced degree to use “data blending” software.
Published in Fraud Magazine
The ACFE’s 2018 Sentinel Award recipient had no intention of changing her orderly life as the city clerk of Dixon, Illinois. And then she found a secret account in city ledgers that led to discovery of Comptroller Rita Crundwell’s astounding $53.7 million fraud. Kathe Swanson’s life will be forever marked by her simple heroic decision.
Published in Fraud Magazine
Whether you’re at the beginning of your career — or second career — or you’ve had years of fraud examination experience, consider entering into a mutually beneficial mentor-mentee professional relationship. This article is for both of you and everybody in between.
Published in Fraud Magazine
We often focus on a fraud’s perpetrator, the conditions that allowed the fraud, plus the victim business and its owners. In this case, the authors cover the bases but also discuss the forgotten aspect: how the fraud affects so many more who live in the concentric circles around the fraudster.
Published in Fraud Magazine
If the oldest, largest and arguably most prestigious law enforcement agency in New England can become a victim of multiple frauds, what does that say about your organization’s exposure?
Published in Fraud Magazine
CFEs elected two new members to ACFE’s Board of Regents for the 2023-2024 term. The new members, Thomas A. Caulfield, CFE, and Natalie S. Lewis, CFE, replaced outgoing Regents Hannibal “Mike” Ware, CFE, and Alexandra Sagaro, CFE, whose terms ended in 2023. Caulfield and Lewis took their oaths of office during the board’s meeting in February.
Published in Fraud Magazine
Achieving the fraud-fighting career of your dreams is more than just a matter of luck. Creating a strategy and executing a plan for cultivating your personal brand can help establish your skills and expertise, while differentiating you from others in the field. Here’s how to get started.
Published in Fraud Magazine
Sales of “gray market” products generally are viewed as legal, but diversion of deeply discounted products from authorized distribution networks is often based upon fraud. Here we examine schemes to illicitly obtain millions of dollars of discounts through this pervasive but relatively unknown type of fraud. And we offer ways to ward off fraudsters’ efforts.
Published in Fraud Magazine
Why would someone confess to a crime they didn’t commit? Often an interviewer, trained to be accusatory and aggressive, will pressure subjects to admit guilt. Here’s how fraud examiners — rightfully constrained by higher ethics guardrails — can prevent false confessions that result in wrongful terminations and improper convictions, and ruin innocent subjects’ lives, while leaving the guilty free to commit additional crimes.
Published in Fraud Magazine
When inflation skyrockets, central banks increase interest rates to slow spending. Here, the author details why periods of high inflation might lead to high rates of fraud in the lending industry and what lenders can do about it.
Published in Fraud Magazine
When countries devastated by war, natural disasters or other calamities must rebuild, valiant efforts to rise from the rubble must be paired with another intangible quality: integrity. But prior experience with hastened economic relief underscores the need to couple that relief with a fortifying effort to deter corruption.
Published in Fraud Magazine
Fraudsters are using dilutions, substitution, counterfeits and mislabeling to infiltrate the global food market; a software engineer in Washington steals from his employer in a scheme inspired by the comedy movie "Office Space"; executives in South Korea are convicted in a $1.5 billion V Global scam.
Published in Fraud Magazine
ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, reflects on the lack of oversight and controls that led to the fall of FTX and the importance for CFEs to prevent and detect fraud in the growing cryptocurrency market.
Published in Fraud Magazine
Iryna Shkraba, CFE, has conducted anti-fraud investigations in almost a dozen European countries. She’s a governance, risk and compliance professional who’s worked for organizations such as EY as well as financial industry companies. And while Shkraba is currently based in Vienna, Austria, she takes every chance she can to visit her family and friends in her hometown of Kyiv, Ukraine.
Published in Fraud Magazine
Recent anticorruption research shows that when companies collaborate to share information about third-party payments and high-risk transactions, they have a 25% greater chance of predicting improper payments than when each company’s model is performed in isolation. A new data-sharing consortium led by a nonprofit at MIT is working to make such collaboration possible.
Published in Fraud Magazine
In 2020, the U.S. Department of Justice (DOJ), in its largest health care fraud enforcement action to date, indicted 345 various health care professionals for submitting $6 billion worth of fraudulent claims to federal programs and private insurers. Among those ensnared in the takedown were pharmacies, which were accused of scheming with telemedicine entities and other licensed health care providers to purchase unnecessary medical equipment and prescription pain medications in exchange for illegal kickbacks and bribes, as well as the illegal distribution of opioid drugs. (See “National Health Care Fraud and Opioid Takedown Results in Charges Against 345 Defendants Responsible for More than $6 Billion in Alleged Fraud Losses,” U.S. Department of Justice, press release, Sept. 30, 2020.)
Published in Fraud Magazine
Andy Greenberg first became fascinated with the dark web and the tools that give people anonymity online when he landed a job as the security reporter at Forbes in the mid-2000s. It seemed at the time that law enforcement and even intelligence agencies couldn’t lift the virtual veil that hid all the wrongdoing taking place in this relatively new digital world.
Published in Fraud Magazine
The meteoric rise and sudden downfall of crypto exchange FTX, and its founder Sam Bankman-Fried, is likely to become an essential case study for fraud examiners seeking to understand the new Wild West of the financial markets. Here we look at what happened and lessons learned from possibly one of the largest U.S. financial frauds.
Published in Fraud Magazine
The ACFE remembers Joseph W. Koletar, DPA, CFE; Kimberly A. Howell, CFE, Maheswari G. Kanniah, CFE, and Robert J. Smolich, CFE, join the ACFE Board of Regents for 2024-2025; and the ACFE Board of Regents disciplines two members.
Published in Fraud Magazine
Since the first Report to the Nation was published in 1996, the Association of Certified Fraud Examiners (ACFE) has surveyed thousands of Certified Fraud Examiners (CFEs) about the methods, costs and effects of occupational fraud. Now in its 13th edition, the Occupational Fraud 2024: A Report to the Nations provides an inside look at how fraud is committed, detected and prevented in organizations around the world.
Published in Fraud Magazine
Research shows that those with inquisitive minds seek novel solutions to unique challenges. Nowhere is this truer than in fraud investigations where curiosity and a healthy dose of skepticism are two sides of the same coin. Fraud investigators won’t detect many instances of financial deception if they don’t use curiosity as a problem-solving skill.
Published in Fraud Magazine
Jennifer Griffith, CFE, and Sarah Carver, CFE, spent years informing their superiors in the U.S. Social Security Administration office where they worked about an operation between a lawyer and an administrative law judge to fraudulently approve thousands of disability claims. But instead of rewarding them for uncovering a massive fraud, their bosses retaliated against them. Carver and Griffith talk to Fraud Magazine about their journey as whistleblowers and their courage to fight for the truth even when the odds were stacked against them.
Published in Fraud Magazine
You probably send cash via Zelle, Venmo, Apple Pay or other mobile apps. But scammers are also using those apps to trick people into authorizing payments. Banks have traditionally balked at refunding victims, but that’s changing as the U.K. government implements the Payment Systems Regulator, and the U.S. government pressures financial institutions.
Published in Fraud Magazine
Charlie Shrem was atop the cryptocurrency world as CEO of pioneering bitcoin exchange BitInstant when he was arrested for indirectly facilitating drug sales on the dark web. Now post-prison, Shrem talks to Fraud Magazine about his transformation into an evangelist for compliance and regulation in crypto and where he thinks the industry will go next.
Published in Fraud Magazine
In 2023, Christopher Linscott, CFE, CPA, CIRA, arranged a donation of $250,000 to the ACFE Foundation — the single largest donation to the foundation ever. Here’s the story of how a Ponzi scheme that bilked thousands of military veterans and retirees became the impetus for that donation.
Published in Fraud Magazine
Football — the international sport, with strikers and goalkeepers — is beloved around the world, but in an intense game where professional teams compete for wins and financial survival, fraud is commonplace. Here’s a primer on the many schemes on and off the field and meaningful steps that football clubs and leagues could take to fight fraud in the sport.
Published in Fraud Magazine
People might not be writing as many checks as they did in the past, but that hasn’t stopped fraudsters from pressing on with their schemes. The author examines why check fraud continues unabated even with the rise of noncash payment options.
Published in Fraud Magazine
Ukraine accuses Ministry of Defense and arms supplier of $40 million fraud; hundreds of sub-postmasters in the U.K. falsely convicted by the U.K. Post Office; and ESPN staff members illicitly secure Emmys for "College GameDay" on-air personnel.
Published in Fraud Magazine
ACFE President John D. Gill, J.D., CFE, shares some of his favorite insights from the latest edition of the ACFE’s biennial publication, Occupational Fraud 2024: A Report to the Nations.
Published in Fraud Magazine
Amanda Malusky Krauss’s passion for fighting fraud began early in her career when an employee of a firm she was auditing slipped her a note detailing a fraud committed by executives. Today, the lead for Axium Consulting’s internal investigations and forensic accounting practices says she’s driven to fight injustice and strives to always respect the humanity of the people she interviews.
Published in Fraud Magazine
One of four key types of analytics has long been considered a “pie-in-the-sky” concept for fraud investigators. Rather than describing or diagnosing something that’s happened or predicting what could happen, prescriptive analytics can tell us what we should do about it. With the growth of generative AI and large language models, it may just be in reach.
Published in Fraud Magazine
The FTC warns social media influencers and college students of job opportunities that are actually ploys to steal personal and financial information. Plus, identity thieves continue to scam people via work-from-home jobs and what you can do to avoid becoming a victim of these schemes.
Published in Fraud Magazine
Retired FBI agent Michael McCall has years of experience investigating white-collar crime in both the federal and private sectors. Throughout his career he’s learned that following the money is key to tracking criminals and continues to fight fraud as owner of an investigative company.
Published in Fraud Magazine
I’d been working for the ACFE for more than two years before I attended my first ACFE Global Fraud Conference. My first year — 1997 — the conference was held in Boston, Massachusetts. We had two educational tracks and a record crowd of 500 attendees. It was also the first time we had exhibitors. I think we had a total of five, including us. I’d never seen so many ACFE members together at one time. It was a little overwhelming being relatively new, but I had a great time and made friends I still have to this day. Fast forward to 2024, and our 35th ACFE Global Fraud Conference is now just weeks away, June 23-28, in Las Vegas, Nevada. It’s hard to believe how much our global conference has grown over the years.
Published in Fraud Magazine
The failure to prevent fraud offense, a key provision of the U.K.’s 2023 Economic Crime and Corporate Transparency Act, is expected to go into force later this year or 2025. The offense, part of the government’s overall strategy to fight financial crime, is meant to encourage corporate accountability for fraud. In this article, anti-fraud professionals assess the new law and consider what organizations might do to prepare as they await government guidance on “reasonable procedures” rules to prevent fraud.
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In 2022, investigative journalist Jeff German had just begun picking at the threads of a story about a Ponzi scheme that targeted members of the Mormon church. But he was murdered before he got the chance to write it. After his death, another reporter, Lizzie Johnson, took up his mantle and finished the story for him. Fraud Magazine recounts Johnson’s and German’s investigation, and talks to Johnson about honoring German’s legacy and the perils that journalists can face on the job.
Published in Fraud Magazine
Many organizations provide fraud awareness training for their employees. In fact, according to survey results from Occupational Fraud 2024: A Report to the Nations, 63% of organizations provide awareness training for their staff. However, not all awareness training is created equal, and I’ve witnessed programs that fall short of their intended goals because they lack key elements. So how can organizations bridge those gaps for effective, adaptable and scalable fraud awareness training
Published in Fraud Magazine
In 2011, Diederik Stapel was a psychologist at Tilburg University in the Netherlands at the pinnacle of his academic career. He was dean of the university’s School of Social and Behavioral Sciences and had a prestigious reputation in academic circles. But that same year, Stapel came under suspicion for fraud, unleashing a chain of events that led to his dismissal after an investigation concluded he’d falsified 55 of his publications and 10 Ph.D. dissertations written by his students.
Published in Fraud Magazine
On July 19, 2021, the U.S. Securities and Exchange Commission (SEC) alleged that Aron Govil defrauded investors of over $7 million through a scheme using investor funds in two companies he controlled, Cemtrex Inc. and Telidyne Inc., for personal expenses. The SEC also alleged that Govil engaged in scalping, insider trading and failing to file required disclosures with the SEC.
Published in Fraud Magazine
The Spanish Civil Guard arrest 14 people led by a man in Morocco for conducting a scheme targeting families of missing migrants; the FTC refunds millions to victims of student debt forgiveness scams; and a woman uses TikTok to get her money back after scammers impersonate her bank and steal thousands of dollars.
Published in Fraud Magazine
Anti-fraud professionals across the globe expect generative artificial intelligence (AI) to be part of their fraud-fighting arsenals in the future, according to the 2024 Anti-Fraud Technology Benchmarking Report. In fact, an impressive 83% of respondents surveyed for the study anticipate that their organizations will add this technology to their anti-fraud initiatives over the next two years.
Published in Fraud Magazine
The new head of a milk processing plant in India was reviewing his company’s management reports when he noticed a glaring discrepancy in the amount of fuel indicated in the report and amount it actually had. The plant, which used the leaves and husks of eucalyptus to fuel its boiler, should’ve had 150 tons of fuel, or 20 heaps of eucalyptus. But the plant head could only find two heaps. He asked the head of engineering and the boiler manager to account for the discrepancy but only got evasive answers. When the company’s internal audit team began to dig into the fuel reports to resolve the discrepancy, they discovered that records were missing.
Published in Fraud Magazine
In 2022, the Association of Certified Fraud Examiners (ACFE) and the Institute of Internal Auditors (IIA) announced a partnership that sought to collaborate on “education initiatives that will raise the competency of each organizations’ members with regard to fraud auditing and investigation.” As I reflected on this announcement, it struck me that both internal auditors and anti-fraud professionals strive to protect the organizations they serve, and though the primary focus may be different, the opportunities to collaborate are indeed vast.
Published in Fraud Magazine
Donald Jones received an email, supposedly from the U.S. Internal Revenue Service (IRS), that said he should expect a tax refund, but he first would have to complete a form and submit it. He clicked on a link in the message and complied with the request. Later that month, Jones’ bank told him that his checks were bouncing because he had a zero balance in his account. Luckily, the bank restored his funds, and he immediately changed his account number to help prevent any future losses.
Published in Fraud Magazine
“We would not have the ACFE without Jim Ratley. Period.” So said Dr. Joseph T. Wells, CFE, CPA, founder and Chairman of the ACFE, at an in-house farewell reception on March 6 for President Emeritus James D. Ratley, CFE. Ratley has retired from the ACFE on his 30th anniversary. Bruce Dorris, J.D., CFE, CPA, formerly the vice president and program director, and an 11-year ACFE executive, has been appointed president and CEO.
Published in Fraud Magazine
The EU General Data Protection Regulation (GDPR) defines personal data as information relating to an identifiable individual, directly or indirectly. That word “indirectly” is important. By having indirect identification in scope, the regulation acknowledges that the traces one leaves behind online aren’t always the obvious descriptors like names and addresses.
Published in Fraud Magazine
More than 450 anti-fraud professionals gathered in Abu Dhabi, Feb. 25-27, for the 2018 ACFE Fraud Conference Middle East. The ACFE presented the conference — for the first time in Abu Dhabi — in partnership with the Abu Dhabi Accountability Authority (ADAA).
Published in Fraud Magazine
Ryan C. Hubbs, CFE, CCEP, CIA; Tony Prior, MBA, CFE, CAMS; and Elizabeth J. Simon, CFE, CPA, took their oaths of office as newly elected members of the Board of Regents during the Board’s semi-annual meeting on Feb. 8 at ACFE headquarters in Austin, Texas.
Published in Fraud Magazine
Fraud fighters don’t successfully detect and deter fraud on their own — they use resources, contacts and the experiences of others to help save millions of dollars each year to their organizations. More than 3,000 anti-fraud professionals will gather in Las Vegas, Nevada, June 17-22, 2018, for the 29th Annual ACFE Global Fraud Conference to power up their network, boost their skills and recharge their careers.
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The “Project Crane” investigation into alleged bullying and other inappropriate behavior of BT Italy executives uncovered the multi-year accounting fraud. In October 2016, BT estimated the fraud to be 145 million pounds. That number grew to 530 million pounds in just four months, and BT would lose more than 8 billion pounds in market capitalization as its shares entered a free fall.
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Independent journalist Clare Rewcastle Brown, at the risk of her safety and without the protection of a news organization, has exposed the flow of billions of public Malaysian dollars from the government’s 1MDB development fund to the country’s top leaders and many others. She says democracies need strong, cynical, courageous media to help protect the public against the powerful.
Published in Fraud Magazine
Diamond fraudsters dupe consumers of all types, including savvy investors and collectors. The global diamond trade, like many other collectable markets, is at the mercy of the absence of transparency. Buyers must cautiously scrutinize gemstones and other low-utility/high-value objects. Here are practical ways for fraud examiners to avoid rip-offs.
Published in Fraud Magazine
As your organization grows, its business could expand into new nations. You might be conducting fraud examinations in cultures with unfamiliar social customs, laws and judicial systems. As I covered in part one in the January/February issue, you should have a solid cross-border investigative plan before you tackle a case with roots in several different countries.
Published in Fraud Magazine
In my November/December 2017 column I wrote that academia should expand traditional forensic accounting programs so our future professionals can respond well to contemporary fraud issues. Many universities do include additional training on identifying and understanding fraudulent activities and are hiring more instructors with practical experience.
Published in Fraud Magazine
'Pharma Bro' sentencing, Theranos CEO charged and beer fraud
Published in Fraud Magazine
Pablo Santamaría Cisneros, CFE, believes that a deep digital transformation is happening in the anti-fraud profession. “New cybersecurity and fraud threats are coming,” he says. As global anti-fraud senior manager at BBVA in Madrid, Spain, Santamaría is tackling these new threats by using data-driven business models and advanced analytics while adapting BBVA’s strategies to work with professionals, tools, methodologies and knowledge in the global community.
Published in Fraud Magazine
A global “quick-service” (i.e., minimal table service) restaurant business with thousands of locations accelerated its employee theft-and-error detection rate at the cash register by approximately threefold. Enhancements included the risk analysis of geographic regions, stores, employees and point-of sale (POS) transactions plus integrating “machine learning” for improved fraud detection.
Published in Fraud Magazine
Clare Rewcastle Brown just couldn’t ignore the corruption. “I could see it was a massive and underreported scandal of vast proportions,” Brown says in the cover article, written by Sarah Hofmann, CFE. “I asked why no one was covering it, and for some time I hoped someone else would. Then I realized all the local people who knew about it felt disempowered.”
Published in Fraud Magazine
Criminals have learned, through trial and error, that anonymous shell companies can pass scrutiny. Authorities and entities don’t question them, the fraudsters blend in and they don’t appear to be risky. They represent the next big sale, the new low-cost supplier or the helpful business agent. And organizations are eager to work with them. It’s time to start reversing this trend.
Published in Fraud Magazine
Susan West was perplexed when she received an email from the Internet Crime Complaint Center (IC3) notifying her that she was eligible for restitution after internet fraudsters had ripped her off. She didn’t remember that she’d been a victim. But she followed the directions to claim the restitution by clicking on an attachment, downloading a form that she filled out with her personally identifiable information (PII) and emailing it to the “IC3.”
Published in Fraud Magazine
Anonymous hotlines and tip-reporting structures are useless, of course, if informants don’t trust them. Employees won’t blow the whistle if they fear reprisals. So, their concerns often don’t enter case-management systems and frauds continue. Here’s how to earn back their trust, take them seriously and transform raw tips into valuable fraud examinations.
Published in Fraud Magazine
In 2017, Odebrecht, a Brazilian construction company, admitted to using bribery and corruption to secure more than 100 projects in 12 countries in Latin America, which generated illegal gains of about $3.3 billion. Odebrecht’s corruption reached the highest levels of government: The web of bribes implicated Latin American presidents, senators and officials.
Published in Fraud Magazine
An accounting firm took on a new client from the advice of a good friend, but it didn’t conduct proper due diligence. Big mistake. During an inventory, the client’s CEO repeatedly lied to the author — a fraud examiner — and the external auditors he worked with. Here’s how to avoid fraudulent clients and keep your sanity.
Published in Fraud Magazine
Jack Sandlin, Indiana state senator and founder of the ACFE Central Indiana Chapter, passed away on Sept. 20, 2023. He’s remembered by loved ones for his integrity and commitment to public service.
Published in Fraud Magazine
Lebanon’s economy has collapsed, aided by corrupt monetary policy, embezzlement and illusory regulatory oversight. Here’s an analysis of Riad Salameh’s mismanagement of Banque du Liban during his three decades as its governor.
Published in Fraud Magazine
For many, the dark web conjures up images of poorly lit rooms where lone fraudsters scam victims behind the veil of encrypted messaging. But the reality is more akin to an open marketplace, like an Amazon for criminals — where they sell multiple fraud products and focus on branding, marketing and the bottom line. That may be frightening, but it also presents an opportunity for law enforcement. Here’s why.
Published in Fraud Magazine
Conducting international investigations abroad requires adaptability and a willingness to learn new customs. The author, who’s conducted many overseas investigations throughout her career, details her experiences to demonstrate why understanding people and their cultures can vastly improve your investigations abroad.
Published in Fraud Magazine
Global organizations employ thousands of suppliers and vendors to get their business done, so they need to use the latest investigative tools of third-party due diligence (TPDD). Here we examine how we can use TPDD to discover how suspicious third parties can use email encryption services (and corresponding primary email addresses) to mask illegal activities and steal valuable data.
Published in Fraud Magazine
‘Cryptoqueen’ associate Irina Dilkinska pleads guilty to wire fraud and money laundering for her role in a pyramid scheme; the U.S. DOJ charges 21-year-old Matthew Bergwall with mail fraud; and British media company Virgin Media 02 launches a free beer for International Fraud Awareness Week.
Published in Fraud Magazine
ACFE President John D. Gill, J.D., CFE, expresses gratitude for the diversity in professions among ACFE fraud fighters united by a passion for fairness and justice.
Published in Fraud Magazine
Credit cooperative societies across the developing world have helped local communities gain vital access to financial systems. But this access comes with a downside. Fraud and other financial vulnerabilities can put members at risk. This is where fraud examiners step in and help protect these cooperatives against such risks.
Published in Fraud Magazine
As a senior academic and researcher, Rasha Kassem seeks to mitigate fraud risks, improve methods of fighting fraud, and better understand why fraud criminals do what they do. She says that investigating fraud isn’t enough to stop it and urges fraud examiners to innovate and explore new techniques for prevention.
Published in Fraud Magazine
The better the data, the better the insight. The better the insight, the better the results. In this issue, we explore how CFEs can help their organizations break down data silos to improve business transparency.
Published in Fraud Magazine
The author uses real-life examples from his fraud investigations to dispel a major myth about bitcoin’s anonymity, showing just how traceable the digital currency is. Unspent transaction outputs are one mechanism to track payments on the blockchain and ultimately discover who’s behind any illicit activity.
Published in Fraud Magazine
We’d just filed our Most Scandalous Frauds story of 2022 when news of the implosion of multibillion-dollar crypto exchange FTX broke. It might’ve been a little too late for us to add what would become the biggest fraud scandal since Theranos to the 2022 list, but the FTX story didn’t disappear, and we had FTX founder Sam Bankman-Fried’s trial and eventual guilty verdict to keep us riveted. Of course, FTX wasn’t the only high-profile case that shocked us; there were many others that had a big impact on the anti-fraud profession. Here are the five fraud cases we found most scandalous in 2023.
Published in Fraud Magazine
Fraudsters stole billions from U.S. federal COVID-19 loan programs. Now unsuspecting victims, who never applied for those loans, are receiving bills. Plus, business ‘NetScaler Gateways’ are attacked, and Medicaid children’s health insurance recipients are scammed.
Published in Fraud Magazine
Commercial fragrances and perfumes are big business, and the multibillion-dollar industry attracts its fair share of dodgy practices and outright fraudulent activity. Here we look at the difference between knockoffs and counterfeit products, and why the big perfume houses have such difficulty protecting their brands.
Published in Fraud Magazine
Nine candidates have been selected to compete for three positions on the 2024-2025 Board of Regents. Beginning Nov. 1 and ending Nov. 30, CFEs may vote online at ACFE.com/BORvoting for their selections to replace retiring Board of Regents members, Wendy Evans, CFE; Collins Wanderi, CFE; and Chrysti Ziegler, CFE. The newly elected Regents take office in February 2024 and will each serve two-year terms.
Published in Fraud Magazine
Investors have been losing their money to scammers since ancient times, but the scale and the cost of investment fraud has only grown in a digital age that has made it easier for fraudsters to steal hard-earned savings. Here we look at some of the different types of investment fraud and the red flags to watch out for.
Published in Fraud Magazine
Cody Easterday was a Washington state rancher and farmer with a sterling reputation. Then Tyson Foods discovered that for at least four years he sent fake invoices to that company, and another, for $244 million for the care and feeding of 265,000 head of cattle that didn’t exist. He pleaded guilty to wire fraud and is serving an 11-year sentence in federal prison. Here’s an analysis of the fraud from a prosecutor, investigators and fraud examiners.
Published in Fraud Magazine
Fraud now accounts for more than 40% of all crime in the United Kingdom. Here we explore what’s behind this proliferation of fraud in England and Wales and what anti-fraud experts say the government must do to crush it.
Published in Fraud Magazine
Joseph L. Ford, CFE, has spent a lifetime fighting fraud, working his way up from file clerk at the FBI to holding the bureau’s No. 3 spot. After leaving the FBI, he served as Bank of the West’s chief security officer and eventually founded his own consulting firm. Here Ford speaks of his experiences investigating both large and small frauds and what we can learn from them.
Published in Fraud Magazine
Higher-education tuition is astronomical. Prospective students and their parents are looking in every corner for financial relief. But fraudsters are searching even harder for desperate victims. Don’t let your panic disable your due diligence. Here’s how to use your fraud examiner abilities to avoid these opportunists.
Published in Fraud Magazine
Elderly victims in Australia lose half a million dollars in alleged romance scam; China and Myanmar join forces to crack down on cybercriminals targeting Chinese nationals; and risk management study reveals retailers are losing money in instances of friendly fraud.
Published in Fraud Magazine
Sometimes a fraudster signs their name, but with a different flourish, to deny later that they ever signed a document at all. The technique is called autoforgery. Here we examine why criminals might use this rare type of fraud and how to prove it in court.
Published in Fraud Magazine
Throughout her career investigating financial crimes — first in the CIA and FBI and now in the private sector — Lourdes Miranda found that understanding human behavior is instrumental to cracking cases. She now urges fellow CFEs to balance technology with human intelligence in their investigations and learn everything they can about cryptocurrency and blockchain.
Published in Fraud Magazine
‘Tis the season to set company goals. As we wrap up 2023 and look to the new year, ponder this: What are some of the key performance indicators (KPIs) companies use to measure the effectiveness of their fraud risk management program? Here, we explore some leading examples of anti-fraud KPIs that drive business value.
Published in Fraud Magazine
Empathy is the ability to understand other people’s emotions, values and behaviors. It was once believed to be too “wishy-washy” or submissive to be taken seriously as a valid approach for investigations or negotiations. But empathy is actually a highly valued dimension of interpersonal, communication and strategic competence that can help fraud examiners more easily obtain an admission of guilt from fraudsters and gain insight into their “why.”
Published in Fraud Magazine
Sam Bankman-Fried, Elizabeth Holmes and Bernard Madoff. What do they have in common? They apparently used their outsized social influence in their professional networks to illegally expand their bank accounts and prolong their crimes. Fraud fighters can’t also be duped by their wily ways.
Published in Fraud Magazine
ACFE President John D. Gill, J.D., CFE, shares lessons learned from ACFE fraud fighters across the globe.
Published in Fraud Magazine
Phishing scams never disappeared; they’re just more sophisticated. Also reject letters promising millions from insurance policies. And beware of invoices for COVID-19 tests you never ordered.
Published in Fraud Magazine
Each year always brings a fresh array of fraud-related scandals, and 2021 was no different. The massive theft of COVID-relief funds continued to play out, but other notable schemes hit the headlines. Here we list the most scandalous of the lot.
Published in Fraud Magazine
Over the past 20 years or so, Africa has seen an exponential growth in anti-corruption agencies as governments across the continent seek to fight what’s still considered to be an endemic problem. Here we look at the history behind ACAs, some case studies and how CFEs can assist in these efforts.
Published in Fraud Magazine
Price-fixing, bid-rigging and allocation agreements are conspiracies you should always be looking for. These experts in illegal and anti-competitive collusion show you how to detect red flags and prevent these crimes. And they give you tips on how to leverage data analysis and cross-border cooperation.
Published in Fraud Magazine
The ability to make a good presentation is a key skill for fraud examiners looking to advance their careers. How you convey your ideas is important. Here are some practical ways to present your thoughts, and it’s not just about putting together a visually appealing PowerPoint.
Published in Fraud Magazine
Any economic disruption leaves businesses vulnerable to fraud both from within and outside an organization. Here we look at how today’s bottlenecks along global supply chains are creating the potential for financial wrongdoing in the coming months and what fraud examiners and auditors should know to prevent it.
Published in Fraud Magazine
Most organizations need vendors to conduct business, but they’re often lax in investigating firms before they use their services. Here are tips for vetting your vendors and avoiding serious fraud problems.
Published in Fraud Magazine
Michael Pocalyko found his passion for fighting fraud when a troubled public company asked him to join its board as a fixer. Since then, the CEO of SI — a Washington D.C.-based intelligence and cyber-sector professional services company — has investigated numerous cases involving governments, corporations, executive misconduct and board-level improprieties. Pocalyko warns that fraudsters are more sophisticated than ever before and to anticipate fraudsters’ creativity.
Published in Fraud Magazine
Businesses and consumers across the globe are quickly adopting cryptocurrencies in daily transactions. And many organizations are scrambling to catch up with this evolving technological innovation. Here’s an update on this new means of exchange, key fraud risks and how CFEs can help with the responsible adoption of crypto.
Published in Fraud Magazine
Cultivating whistleblowers is harder work than persuading traditional interviewees to talk during an investigation. Use these profiles to categorize Victims, Avengers, Samaritans and Intellectuals.
Published in Fraud Magazine
From paper to computer chips, products we once took for granted have become precious commodities as the global supply chain cracks under the weight of labor shortages and renewed demand in the wake of the COVID-19 pandemic. And as every fraud examiner knows, whenever there’s a need for a product or service, fraudsters are there to exploit it for their own gain.
Published in Fraud Magazine
Tom Golden’s latest thriller is not only entertaining but it’s also a handy case study of a fraud investigation. The veteran fraud investigator and forensic accountant talks to us about what he’s learned, how the ACFE made all the difference to his illustrious career and why we need more CFEs.
Published in Fraud Magazine
The ACFE's 2022 survey of CFEs around the world and the occupational frauds they have detected and investigated
Published in Fraud Magazine
2022-2023 Ritchie-Jennings Memorial Scholarship winners.
Published in Fraud Magazine
Choosing an investigator with the right skill set is key to successfully resolving a fraud case. An attorney is often best suited for the role but not always. Here we look at the pros and cons of using someone with a legal background to investigate fraud and the challenges of wearing two hats.
Published in Fraud Magazine
Billing fraud may not capture all the big headlines, but it’s pervasive, hard to detect and has been growing since the outbreak of the COVID-19 pandemic. Here are some recent case studies and a bird’s-eye view of how and why this type of fraud thrives.
Published in Fraud Magazine
We’ve all been in meetings where prominent issues needed resolution, but after a couple of hours, the team made little or no progress. A neutral, third-party facilitator, moderator or mediator can help run meetings more efficiently and navigate all parties to desirable outcomes.
Published in Fraud Magazine
Tony Kwok knows a lot about corruption and how to fight it. He was the former deputy commissioner of the Independent Commission Against Corruption, Hong Kong’s ace anti-graft agency. He talks to Fraud Magazine about how it changed the city forever and what he’s doing now to help other countries fight fraud and corruption.
Published in Fraud Magazine
Fraudsters create identities from bits and pieces of fictitious or stolen personally identifiable information. The U.S. Federal Reserve provides a one-stop online toolkit with downloadable resources to help educate financial institutions and other businesses about synthetic identity fraud and how to protect themselves.
Published in Fraud Magazine
Netflix investors sue the streaming service for securities fraud; Spanish police crack a luxury car scam; Lincoln College shuts down in part because of a ransomware attack.
Published in Fraud Magazine
ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, discusses Cressey Award winner, Tony Kwok and his success fighting corruption in Hong Kong. Kwok was the deputy commissioner of Hong Kong's anti-graft agency, the Independent Commission Against Corruption (ICAC). Dorris also discusses the growing problem of corruption all over the world.
Published in Fraud Magazine
As a child, Kenneth Boey read mystery novels and dreamed of fighting crime as a police officer. Now, Boey is a full-fledged fraud fighter, ensuring that his company, Etiqa Insurance, has strong controls in place to protect its systems from threats.
Published in Fraud Magazine
Artificial intelligence (AI) is changing how businesses run — especially in anti-fraud and compliance. Here we describe how to build an AI-focused, anti-fraud technology company and what mindsets, strategies and tactics work well for organizations and entrepreneurs.
Published in Fraud Magazine
When a cybercriminal breaches an organization’s data and financial systems, management automatically begins investigating the culprit’s financial motives. But often hackers are just curious to see if they can invade mainframes. Or they’re bored and want to have some fun. Here’s how to investigate cybercriminals’ minds, understand their nuanced purposes and then prevent more breaches.
Published in Fraud Magazine
Amid the current enthusiasm for all things crypto, interest in decentralized finance (DeFi) has exploded. Proponents think it will help democratize finance. But fraud is running rampant in this corner of the market. Here’s how it works and why fraud examiners should be paying attention.
Published in Fraud Magazine
It seems like identity thieves never sleep. Now they want to imitate your friends and hack into your social media accounts. And they want to compromise your credit scores. Here’s how to protect yourself and your loved ones.
Published in Fraud Magazine
Fraud examiners don’t need cutting-edge techniques to fight fraud in the burgeoning area of environmental, social and governance (ESG) initiatives. They can simply build on existing tools and guides to mitigate those risks, according to the latest report from the ACFE and Grant Thornton LLP, "Managing Fraud Risks in an Evolving ESG Environment."
Published in Fraud Magazine
Fraud examiners came together for the first time since the outbreak of the COVID-19 pandemic at the 33rd Annual ACFE Global Fraud Conference in June. The association’s first hybrid event for both in-person and virtual participants enjoyed record attendance and has proven to be a winning formula.
Published in Fraud Magazine
My early undergraduate study as a foreign language major plunged me into linguistics, semantics and phonetics — collectively referred to as rhetorical devices. I found these tools enhanced the importance of the underlying communication architecture of the languages I studied. Throughout my career as I progressed to higher levels of leadership, these rhetorical devices continued to influence my communication acumen.
Published in Fraud Magazine
Catching and preventing fraud in the European Union is no easy task, and its anti-fraud agency OLAF has more than its fair share of wrongdoing to contend with. We talk to Ernesto Bianchi, OLAF’s acting deputy director-general of operations and investigations, about challenges ahead as the EU prepares to disburse money from its biggest-ever budget.
Published in Fraud Magazine
An organic farmer is busted for selling non-organic grains; Ukrainian law enforcement arrest cybercriminals for a phishing scheme against Ukrainian citizens; Salt Lake City 'Real Housewife' Jen Shah and and rapper Nuke Bizzle plead guilty to fraud schemes.
Published in Fraud Magazine
ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, discusses quantum technology to fight fraud and how important it is for CFEs to anticipate fraudsters using the technology as well.
Published in Fraud Magazine
Many organizations that have nurtured new business via cross-border e-commerce sales are vulnerable to payments fraud, especially during the COVID period. Here’s how to fight global cybercriminals at their own game.
Published in Fraud Magazine
Ricky D. Sluder, CFE, first discovered a knack for solving fraud cases when he was a detective in Dallas County, Texas. Now the head of healthcare value engineering for Shift Technology is using his investigative know-how to help other investigators better prevent and detect fraud.
Published in Fraud Magazine
It’s been over a decade since we examined Fraud Triangle Analytics, a method of risk ranking individuals by applying keywords for pressure, opportunity and rationalization to electronic communications. Here we look at how advancements in technology have helped improve FTA in today’s battles with tech-savvy fraudsters.
Published in Fraud Magazine
Fraud examiners working in financial services are familiar with cutting-edge innovations to fight fraud. But quantum computing may be a game changer. Here we explore how this groundbreaking technology could help CFEs and some of the dangers it might entail.
Published in Fraud Magazine
Fraudsters have stolen an unprecedented amount of U.S. COVID-19 relief funds — possibly more than the GDPs of many world economies. But millions of dollars had already been streaming from government programs long before the pandemic, and those cases hold valuable lessons. Here’s how to stanch the flow of money from vulnerable agencies.
Published in Fraud Magazine
Fraudsters want your personally identifiable information. And they’ll steal it by trying to convince you to apply for phony jobs, respond to a fake alert that illegal goods were shipped in your name and have been intercepted, and bogus student loan forgiveness programs. Foil them before they try to punk you.
Published in Fraud Magazine
The world is changing quickly, and fraud fighters must adapt to the times. The ACFE Board of Regents relate their experiences in fighting fraud, waste and abuse, and the new battle opening up on the technological front.
Published in Fraud Magazine
The ACFE and SAS release their 2022 Anti-Fraud Technology Benchmarking Report; nominations open for the 2023-2024 Board of Regents
Published in Fraud Magazine
Alex Gibney’s documentaries have covered some of the biggest frauds of our times. The award-winning director talks to us about what he’s learned about the psychology of corporate fraud and more. It might not be what you expect.
Published in Fraud Magazine
U.S. bankruptcies — and bankruptcy fraud — greatly decreased during the pandemic because of temporary lifelines. But as government stimulus, pliant lenders, and cheap and easy funding dissipates, we’re seeing crimes rise. Changes in U.S. federal bankruptcy law could accelerate prosecution of bankruptcy fraud.
Published in Fraud Magazine
Management at Collin Street Bakery, the maker of famous fruitcakes, trusted its close-knit family of employees. Big mistake. That faith cost the company close to $17 million in a massive fraud that serves as an excellent case history.
Published in Fraud Magazine
During their careers, fraud examiners will inevitably run into major problems on a high-profile project such as a forensic investigation. Human interaction can be a messy affair and often a major hindrance in project management. Here are tips to minimize cognitive bias and other psychological pitfalls that sabotage the best-laid plans.
Published in Fraud Magazine
Rachel Wilson was a cybersecurity expert before the broader world was even aware of such threats. The former head of the U.S. National Security Agency’s cyber exploitation operations now works to protect Morgan Stanley’s wealth management clients and systems. She talks to us about the latest dangers lurking in cyberspace and much more.
Published in Fraud Magazine
What if a company could significantly improve its financial results, regardless of reality? That opportunity exists today. The fallout from the COVID pandemic has made financial estimates increasingly difficult to calculate and open to manipulation and fraud. Here’s why.
Published in Fraud Magazine
The U.S. Small Business Administration’s Office of the Inspector General faced unprecedented challenges during the COVID-19 pandemic, but a diverse staff was able to weather the storm. Inspector General Hannibal Ware details how his organization built a diverse workforce able to withstand tough times and how other organizations can do the same.
Published in Fraud Magazine
The former Czech prime minister is indicted for fraud; A Wisconsin dentist breaks his patients' teeth as part of an insurance fraud scheme; The U.S. Department of Justice appoints a chief prosecutor to handle pandemic fraud.
Published in Fraud Magazine
Alex Gibney has documented many fraud cases in his three decades as a filmmaker. From his first big hit in 2005, “Enron: The Smartest Guys in the Room,” to the more recent documentary about Elizabeth Holmes, “The Inventor: Out for Blood in Silicon Valley,” Gibney has long been exploring the psychology of deceit and why bright and talented people turn to the dark side.
Published in Fraud Magazine
While conducting forensic and fraud examinations involving small organizations, Julie Aydlott saw just how devastating fraud could be for businesses with limited resources. Aydlott and a colleague founded Business Fraud Prevention, Inc., a nonprofit dedicated to providing free training and resources to help small business owners implement internal controls and fight fraud.
Published in Fraud Magazine
Fraud is constantly evolving. So too should our technologies for detecting and preventing it. Inspired by the Seven Wonders of the World, I present my seven favorite anti-fraud techniques. Some have been in use for over a decade, some are new and evolving — but all of them are “wonderful.”
Published in Fraud Magazine
While external fraudsters who absconded with billions of dollars in pandemic relief have dominated headlines, less attention has been paid to employees scamming those very same programs. Here we spotlight internal fraud at state agencies and what organizations can do to fight this pernicious type of fraud.
Published in Fraud Magazine
Fraudsters continue to harvest PII by targeting professional tax preparers, compassionate givers and COVID unemployment insurance benefits money.
Published in Fraud Magazine
Six candidates have been selected to compete for two positions on the 2023-2024 Board of Regents. The board sets standards to promote professionalism and to ensure the reputation of the CFE credential.
Published in Fraud Magazine
The ACFE kicks off its 2022 International Fraud Awareness Week, Nov. 13-19, with high-profile organizations like Walmart, Microsoft, General Mills and ADP signed on as Fraud Week Ambassadors to host in-person and virtual educational events meant to raise awareness about fraud and promote anti-fraud training.
Published in Fraud Magazine
When Florida Governor Ron DeSantis banned all nonemergency medical procedures in the state in early 2020 to help battle rising COVID-19 cases, Physician Partners of America LLC (PPOA) searched for other ways to compensate for falling revenue. The solution? The health care provider allegedly required its physicians to schedule unnecessary telemedicine visits every 14 days instead of each month. It then overbilled Medicare and Medicaid, the U.S. federal insurance systems for older and low-income Americans, by submitting overvalued evaluation and management (E&M) codes that compensated PPOA more than was warranted by the patients’ visits.
Published in Fraud Magazine
You look 10 years old. The opposing expert has been an expert witness for 30-plus years. Why in the world should even one juror listen to you over the opposing expert?” It was 7 a.m. in August 2021 — the week prior to my first deposition ever as an expert witness in a trial — when I received an email with these insults. The plaintiff’s counsel had retained the firm I worked for to analyze and trace the plaintiff’s investment into XYZ Corp. My then-managing partner and I jointly prepared a report detailing XYZ’s lack of inventory records, cash withdrawals disguised as inventory purchases and improper revenue recording. Because I’d performed most of the analysis, I asked the plaintiff’s counsel if I could testify rather than my manager (who had three decades of experience providing litigation support services). The plaintiff’s counsel replied with the most belittling, demeaning and unprofessional email that I’d ever received. Yet I couldn’t stop laughing. After multiple rereads of this email, I decided it would be for the best to let it go and not respond. Turns out, that was a good move.
Published in Fraud Magazine
Authorities apprehend Leonard Francis, who recently escaped house arrest after involvement in Naval corruption case; the Federal Trade Commission sues Roomster Corp. for using false apartment listings and fake reviews; Police in China arrest criminal gang responsible for major banking scandal
Published in Fraud Magazine
Imagine you’re working at your desk in your company’s office (not at home at your kitchen table in your pajamas), and a friendly co-worker (we’ll call him Frank) strikes up a conversation. Frank asks about your recent birthday and listens intently as you describe how you celebrated. He dives deeper, asking about your best birthday party and your all-time favorite birthday present. You don’t consciously realize it, but Frank is using your name frequently and mimicking your body language. Finally, he admits he feels a bit insecure about the fact that he’s never been a good gift-giver and fears no one has fond birthday memories about him.
Published in Fraud Magazine
ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, discusses the importance of understanding cybercrime and the tactics used by cybercriminals to prevent fraud in an increasing complex financial landscape.
Published in Fraud Magazine
Long before she became a fraud examiner, Gogi Overhoff, CFE, had her sights set on becoming an actress. But instead of a life on stage, she shines a spotlight on licensed accountants accused of defrauding their clients in her role as an investigator for the California Board of Accountancy.
Published in Fraud Magazine
A global corporation with operations in Latin America, West Africa and Eastern Europe was being investigated by the U.S. Department of Justice (DOJ) for alleged violations under the Foreign Corrupt Practices Act (FCPA). In coordination with outside counsel and its forensic accounting service provider, the corporation applied technology-assisted review (TAR) techniques to payment transactions, reducing the DOJ’s $30 million in bribery and corruption allegations to less than $8 million and allowing them to settle the case out of court. Did I get your attention?
Published in Fraud Magazine
Before he died earlier this year, Robert Brockman stood accused of multiple charges of wire fraud and money laundering in what was the biggest tax evasion case of its kind in U.S. history. During a 20-year period, he allegedly hid over $2 billion in income from the IRS in secret offshore accounts, using encrypted communications and false documents.
Published in Fraud Magazine
“We must do something to stop the commodore. He disobeys orders, takes government property for himself, uses our ship for smuggling and orders the torture of our British prisoners. He is evil and corrupt.” We can only imagine secret conversations such as these among 10 sailors late one night in 1777 aboard the Warren, a U.S. naval warship anchored off the coast of Rhode Island. What we do know is that the men sent a letter to the Continental Congress that described the illegal and violent deeds of their commodore, Esek Hopkins, setting in motion efforts that resulted in the world’s first law to protect whistleblowers.
Published in Fraud Magazine
North Korean state-sponsored cyberfraudsters are attracting increasing attention and, so far, have been outsmarting the government authorities pursuing them. Here’s what fraud examiners can learn from the authoritarian regime’s tricks to exploit the latest technology and what they need to know to stop them.
Published in Fraud Magazine
Commercial fisherman, Carlos Rafael, known as “the Codfather” in New Bedford, Massachusetts, spent years selling thousands of pounds of misrepresented catch under the table for cash, laundered his money and overvalued his business to the IRS, among other crimes. His illegal monopoly predated well-intentioned conservation efforts of governments and citizen groups that inadvertently might have created an environment ripe for fraudulent fishing and reporting activities.
Published in Fraud Magazine
Susan Jones received a letter from a law firm that told her that she might be the recipient of a long-lost relative’s multimillion-dollar inheritance. To process the claim, she wired the firm a deposit, her Social Security number (SSN) and bank account numbers, but she didn’t receive any correspondence after that. Two weeks later, her bank account had a zero balance.
Published in Fraud Magazine
CFEs elect three new members to the ACFE's Board of Regents for the 2022-2023 term.
Published in Fraud Magazine
Jeanette LeVie, CFE, the ACFE's vice president and chief operating officer, celebrates her 30th anniversary at the leading anti-fraud training and education organization.
Published in Fraud Magazine
Countries across the world are increasingly recognizing the importance of whistleblowers in the fight against corruption and fraud. Here’s some useful background for CFEs wanting to know about the latest whistleblower protections and legislation.
Published in Fraud Magazine
Digital fraud has surged as the COVID-19 pandemic only accelerated the use of computers and cell phones for everything from banking to shopping. Here’s the latest on the evolving threat landscape and what CFEs and security experts are doing to stop cybercrime.
Published in Fraud Magazine
Pav Gill is now widely recognized as the internal whistleblower who helped expose corruption and fraud at the now-defunct German fintech Wirecard. In a little over a year, his professional and personal life was turned upside down. Gill tells Fraud Magazine his story and the lessons he learned from this bizarre journey.
Published in Fraud Magazine
As organizations and people across the globe observe International Women’s Day in March, the author talks to anti-fraud professionals about the challenges they face in the field, their successes and how they’re overcoming gender bias.
Published in Fraud Magazine
Global anti-fraud and compliance enforcement is on the rise, and regulators want proof that fraud risk management programs are effective. Here we look at some of the hard questions organizations need to ask and some examples of how companies have updated their systems to tackle fraud in the post-COVID environment.
Published in Fraud Magazine
It’s a fact: Data monitoring and analysis can help catch fraudsters. Here’s a primer on incorporating data analysis into your organization along with the latest ACFE tools.
Published in Fraud Magazine
Thirteen people indicted for a $100 million no-fault car insurance scam, sisters perpetrate a tax return fraud scam and Pakistan contemplates banning cryptocurrency.
Published in Fraud Magazine
Commercial-loan agreements can pressure borrowers and lenders to cross the line to avoid bankruptcy or fleece customers. Here are some common fraud schemes that desperate parties can use in this cat-and-mouse game.
Published in Fraud Magazine
The ACFE honors Pav Gill as the Wirecard whistleblower.
Published in Fraud Magazine
Having an environmental, social and governance strategy has become all-important for companies. But as criticism over misleading and fraudulent claims grow, regulators are clamping down and pushing to clarify ESG disclosure rules. As they do in financial reporting, CFEs will have a big role to play in this hot but nascent corner of the market.
Published in Fraud Magazine
Monica Meeks is a U.S. Army veteran and veteran fraud investigator who first honed her fraud-fighting skills as a service member probing credit card fraud committed by Army officials. Now the financial services investigator for the Tennessee Department of Commerce and Insurance, she shares lifelong lessons with students and fellow veterans, educating them about fraud and the value of earning the CFE credential.
Published in Fraud Magazine
Deficient due diligence during the pandemic has allowed real estate investment schemes to proliferate amid a boom in property prices. Consulting fraud examiners and those who work for potential investors and financial institutions can help prevent these extravagant frauds.
Published in Fraud Magazine
U.S. federal government agencies will never text, email or contact citizens on social media or via robocalls. But scammers will. Here’s information on the child tax credit, broadband benefit program, pandemic-related economic payments and fake QR frauds.
Published in Fraud Magazine
Brief Video Description shows on list page and also the main video landing page
Published in ACFE Video Library
This is a sample Description for the Podcast Article - TEST SOP
Published in Fraud Talk Podcast
The results of this survey are presented in the In-House Fraud Investigation Teams: 2017 Benchmarking Report.
We have frequently heard from our members about a desire to benchmark their organizations’ internal fraud investigation teams.
The ACFE Brand Guidebook, as well as the accompanying resources below, are designed to help you promote yourself and your affiliation with the ACFE.
Discover our featured case studies and learn how many of today’s fraud cases are old schemes dressed in new technology with a new cast of characters.
Find resources for ACFE members and others to foster diversity, equity and inclusion in the anti-fraud community and beyond.
