Lessons from the ACFE Global Fraud Conference: Newest Prevention and Detection Methods

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.

July 2013 

By ACFE Staff 

 

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 24^th Annual ACFE Global Fraud Conference, expert presenters brought timely fraud issues to the forefront and explored ways in which fraud examiners can best be equipped to deal with them.

 

This article spotlights just a few of these trending issues and what was learned in presentations about them last month in Las Vegas: using social media and the Internet to fight fraud; the latest ways to maximize data analytics; and how to be prepared when fraudsters use old technology in a new fashion.

 

Using Intel Gleaned from the Internet and Social Media 

“Nothing is private online. We can encrypt things and put up firewalls, but there is always someone out there who can get your information.” Cynthia Navarro shared this stark reality during her presentation: “Exploiting Internet and Social Network Intelligence to Enhance Investigations.” Navarro is Principal of Finnegan's Way, an investigative consultation and training firm located in California.

 

What type of information could be important, both for fraudsters and investigators? A few examples:

A family photo on Facebook that also holds important time and date stamps 

An online purchase that reveals a personal interest or habit 

A business affiliation on LinkedIn that confirms a suspected insider trading tip  

 

Navarro pointed out the following statistic: Cisco projects that by 2022, they will have $14.4 trillion in profits solely from the Internet. That is a lot of profit from a technology that is only a few decades old.

 

She stressed the importance of search engines – among them are familiar names, such as Google, Bing and Yahoo!, and some that aren’t so familiar. Other U.S.-based search engines include:

Lygo 

MSN 

Dogpile 

About 

Kartoo 

Altavista 

Alltheweb 

Mamma 

A9 

Kartoo 

Quinturq 

Clipblast 

Like 

 

Adding to these options are international sites that can be used for research, including:

Stopfakes.gov 

Made-in-China 

Corporateinformation 

Thepaperboy 

Kidon 

Asianproducts 

Fita.org 

 

And, of course, any discussion about searching the Internet would be remiss without highlighting social networking sites like Facebook, Twitter, Instagram, Mocospace and hi5, as well as blogs.

 

 “If there is a blog that is talking about the banking industry, and you are in the banking industry, that is where you need to go,” Navarro said. “The information that is on there is coming from your employees and contractors.”

 

Data Analytics in the Fight Against Fraud 

The term “big data” has changed the way accountants, auditors and fraud examiners look at what used to be rows and rows of Excel spreadsheets, or — before that — what used to be pages and pages of handwritten company ledgers. When we say “big data,” we are not referring to data that is trendy or hot; there aren’t groups of data sets cruising around the web or in our email wearing skinny jeans and tight v-necks. The term “big” describes the vast amount of information lying in the structured and unstructured data every business produces. Gartner defines big data as “high-volume, -velocity, and -variety information assets that demand cost-effective, innovative forms of information processing for enhanced insight and decision making."

 

In “Taking Data Analytics to the Next Level,” Vincent Walden, CFE, CPA, senior manager of fraud investigation and dispute services at Ernst & Young, provided the tools needed to capture, organize and filter data that could ultimately catch or stop a fraud.

 

Among the key takeaways from his presentation, Walden described the top ways to work with your company’s IT department to get the analytics you need:

Design your analytics based on fraud risks 

Determine your required data sources (structured and unstructured) 

Prepare a data-request memo (specify table names, desired data output and time frame) 

 

Walden advised attendees to remember to:

Recall the Forensics Analytics Maturity Model 

Leverage multiple data sources — both structured and unstructured 

Identify links between structured/unstructured data and unite them in a stronger platform 

Use search-around functionality to analyze data from multiple aspects 

Use geocoding and heat maps to identify high-risk regions 

  

Fraudsters Use Old Technology in New Ways 

Christopher Rosetti, CFE, CPA, focused on how old technology can be used in new ways in “Cutting Edge Tips in Today’s World of Fraud.” Rosetti is Partner-Fraud Investigations with BST. First, he explored the way fraudsters are getting ahead of the game with new methods of their own. A few examples of the mediums through which they perpetrate these schemes:

Metadata – the digital DNA of who created a document and who made changes and when 

Made-to-order fake websites 

Use of alibi websites – these produce documents to “corroborate” a fraudsters story 

Data storage and transmission techniques – such as flash drives 

 

Alibi websites offer an astonishing array of services, according to Rosetti. Provided by sites like Falseexpenses.com, Alibinetwork.com and Alibisnpaybacks.com, these services may include:

Receipts on authentic thermal paper 

Rescue calls to get you out of meetings 

Virtual doctors’ offices 

Fake travel documents and confirmations 

Virtual employment, including business cards, letterhead and confirmation of “employment” 

Escape-a-date 

 

To read more about these sessions and other techniques, trends and best practices shared at the 24^th Annual ACFE Global Fraud Conference, go to FraudConferenceNews.com.