corporate fraud

CORPORATE FRAUD INVESTIGATION- THE UNKNOWN FACTS – Atlanta Georgia

November 22, 2010 by Staff Editor Leave a Comment

A corporate fraud investigation is much more complicated than many of us think. I’ve been in corporate America for years and did not understand the intricacies of how the investigation of wrongdoing is conducted in a large corporation. Or even who conducts that investigation.

The first intriguing fact is that a corporate fraud investigation is not only a private affair but involves the help of many federal agencies, including the Internal Revenue Service. This is because the violations that are usually being investigated are in relation to the Internal Revenue Code and related statutes.

These crimes of corporations usually involve senior executives. People who investigate these crimes must be able to concentrate on and understand the intricacies of high corporate finance and accounting. The most prevalent law that prevents violations of the Internal Revenue Code is Sarbanes-Oxley. This act imposes stiffer sentences of up to 20 years in prison for the destruction, alteration or falsification of records in order to impede a federal investigation.

In 2010 there were 116 corporate fraud investigation s initiated. Of those 116, 91 of those recommended that someone be prosecuted. There was actually a 77% incarceration rate of those 116 investigations with senior executives serving an average of 48 months. This information comes from the Criminal Investigation Management Information System.

Need advice on a corporate fraud investigation. Contact us or call 1.770.426.0547 – Atlanta Georgia

CORPORATE FRAUD INVESTIGATOR, DO YOU HAVE THE SKILLS? – Atlanta Georgia

November 17, 2010 by Staff Editor Leave a Comment

In order to be a corporate fraud investigator , you may need skills you aren’t aware of. It takes more than private investigator criminal catching know-how to be on the team that investigates corporate fraud. There are a variety of crimes investigated by these individuals that range from tax evasion to embezzlement.

Corporate fraud crimes have a different scope, complexity and magnitude than your common everyday theft or fraud case contains. The ramifications can have economic consequences for employees and communities and can often affect the entire investment market.

A corporate fraud investigator has to have accounting expertise. They must be able to identify anomalies in vast company financial records and book keeping transactions. They must have excellent computer skills. Where else do you think all those accounting records will be store, yep you got it, on a computer.

The corporate fraud investigator needs to also be a bit of a computer “hacker”. Often times important documents have been password protected or encrypted to prevent detection.

According to several online sources and our own people a corporate fraud investigator has on average between 5 and 20 years of experience. The hourly rate is dependent on the experience level of the individual.

Want more information on corporate fraud ? Contact us at corporate fraud investigator or call 1.770.426.0547. Atlanta Georgia

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CORPORATE FRAUD…HOW COMMON IS IT? – Atlanta Georgia

November 15, 2010 by Staff Editor Leave a Comment

Corporate fraud schemes cost the United States billions of dollars every year. With hundreds of different fraud schemes out there it’s hard to determine the exact cost to companies across the nation. Believe it or not there are two specific types of corporate fraud involving insurance companies that all these schemes fit into…very simply hard versus Soft fraud. Both require a corporate fraud investigation.

Hard fraud schemes are meticulously planned out. As an example of a “hard” fraud scheme, setting an arson fire to collect insurance money on a building. Most organized crime rings have some sort of hard fraud scheme game they are into. It can be setting up auto accidents or even as intricate as an auto theft ring.

Soft fraud is much more common in the scheme of the general world population. Soft fraud is committed when an individual has an “opportunity” to exploit what might actually be a legitimate insurance claim. A soft fraud also requires a corporate fraud investigation.

Let’s look at an example of soft fraud. So this giant clunker, rusted, beat up car pulls in behind you in a parking lot. You don’t see the car. You back right into it!! Wow. Aren’t you surprised when your insurance adjuster informs you that the small dent you thought occurred has turned into replacing the entire rusted front of this jalopy. The person you hit has taken an “opportunity” to scam more money from your insurance company than is rightfully theirs. And voila, you have corporate fraud the “soft” way.

Do you think that corporate fraud is occurring in your business? Contact us at corporate fraud investigation or call 1.770.426.0547 – Atlanta Georgia

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Who Commits Employee Theft? – Atlanta Georgia

November 10, 2010 by Staff Editor Leave a Comment

At this point we all know that employee theft goes on in every organization. However, the million dollar question still remains: who will it be? I was told once of an old accepted truth within loss prevention circles. It’s called the 10-10-80 rule. What this rule basically states is that 10% of people will never steal, no matter the circumstances. 10% of people will steal given their first opportunity and continue to do so at every chance they get. 80% of people can go either way depending on how they rationalize the opportunity and access the risk involved. It is our job to sway the thinking of that 80% to believing that it’s just not worth it.

Statistics show that younger employees tend to steal far more often than older ones. Before you go putting the kibosh on your hiring of the under 30 crowd, statistics also show that when older employees do steal they tend to steal a lot more than their younger counterparts. Managers who have been employed for over 3 years are the usual culprits when it comes to employee theft . They’ve been around long enough to know the system inside and out, including any loopholes that might exist. Often they may be disgruntled or consider themselves underpaid, under-appreciated or both.

Most employee theft comes to the attention of the employer by another employee or strictly by some sort of accident. On average it can take up to 18 months for an employer to catch an employee that has been stealing. Imagine how much damage one person can do in that amount of time. A smaller business is less likely to be able to absorb that type of loss when it happens. There are a number of cases where the theft of one individual has driven a small business into bankruptcy. The fact is that anyone can commit employee theft , so you must be vigilant in your efforts to identify them.

For more information about employee theft investigation or corporate fraud investigation contact us at employee theft or call 1.770.426.0547 – Atlanta Georgia

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Corporate Fraud….Insurance Scams – Atlanta Georgia

October 29, 2010 by Staff Editor Leave a Comment

One of the leading corporate fraud scams out there is insurance scamming. Insurance Fraud is any act committed with the intention of obtaining funds fraudulently from an insurance provider. These types of frauds not only cost companies billions of dollars annually, but can affect the lives of innocent by standers as well. The Coalition against Insurance Fraud estimates that in 2006 a total of about $80 billion was lost in the United States due to insurance fraud.

Let’s look at an example of corporate fraud that affects the innocent. Ever been sitting at a red light, minding your own business and someone intentionally hits you from behind, then you hit the car in front of you. Well when the person in front of you claims a neck injury….because he was working with the creep who hit you….files false medical costs…….then they are committing insurance fraud.

Medical disability is also one of the leading corporate fraud scams for insurance companies and worker’s compensation. Say an employee is able to convince a medical professional they are unable to work due to an injury they sustained while on the job. Not only is the company out worker’s compensation monies, but the government is out disability funds if they employee claims they cannot ever work! My dream job would be follow these folks around that are capable of holding a job but defrauding the government for disability and take photos of them riding bikes and water skiing.

Corporate fraud in the insurance market is one of the hardest to prove. Do you think your corporation, insurance company or otherwise, have been the victim of Fraud? Contact us at corporate fraud or call 1.770.426.0547. – Atlanta Georgia

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Employee fraud more of a temptation in poor economy and becoming tougher to tackle

October 29, 2010 by Staff Editor Leave a Comment

The poor economy leads more people into employee fraud temptation. They say there are three types of employees; those who fall into the ten percent who will never steal from you no matter what, those who will steal from you at some point if given the right opportunity at about 80%, and the final 10% who are going to steal from you no matter what.

So the eight percenters are the ones we need to watch, obviously now more than ever, being in these tough economic times. And this 80% group is probably full of people you would think would never steal from you no matter what. So how do you know who is a thief and who is not when you recognize you are having a problem somewhere and likely experiencing employee fraud of some kind?

Your CPA may be the first person you call to put some pieces of the puzzle together. They will no doubt find issues. So now what? You have some irregular activity identified, could be one or more of a few different employees. How do you get to the truth without accusing all the potential suspects and damage relationships with good employees? Answer, a professional corporate fraud investigator can get down to the truth without blowing anyone up, and they will protect you from the process.

We often work with CPAs and CFEs as a link in the chain of their unvestigation. A trained employee fraud investigator from our team will utilize information gathered to lead them through specific interviewing tactics and ultimately interogation techniques if needed to deliver a written confession. No rubber hoses or scare tactics necessary.

If you have a concern about internal theft and would like to learn more, please visit employee fraud.

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Does your business need a Corporate Fraud Investigator? – Atlanta

October 19, 2010 by Staff Editor Leave a Comment

A corporate fraud investigator is a seasoned professional trained in the art of detecting fraud at the corporate office and the executive level. These investigators spend large amounts of their time looking through ledgers and performing forensic accounting.

A business having issues with accounts payable, accounts receivable, merchandise flow and at times, merchandise at the distribution centers or other areas can be indicators of corporate fraud . Although there are numerous other ways for fraudsters to “do work”, the IRS believes the negative impact of corporate fraud depends on the complexity and magnitude of the schemes.

A simple look at corporate fraud takes us to the basics. Let’s say an Executive within an organization and two other of his coworkers decide to take advantage of the company they work for. The main executive makes several purchases on his corporate credit card. These purchases include repairs to his personal home, clothing and jewelry for his wife/girlfriend. Additionally, this executive hires his two coworkers as “consultants”. The “consultants” are paid hundreds of thousands of dollars for work that is never performed. Altogether, these fraudsters are bilking the company for serious amounts of money.

To truly understand the inter-workings of these schemes, the corporate fraud investigator will spend time digging, building, reviewing and identifying the trends and activities of the suspected employees. This is not an easy task. The investigator has to stay sharp and know the signs of fraud.

In another example, a business partner starting a new sales division needed money from investors. He falsely claims to have contracts with other large “brand name” businesses and tells investors the return on their investment will gain them a 15% return. The investors, seeing the potential for profits gave out millions. The fraudster took the monies and opened bank accounts overseas and trusts in the name of family members. The corporate fraud investigator working this case quickly saw the concerns on the investors when the returns never came in.

For more information about corporate fraud, contact us at corporate fraud investigator or call 1.770.426.0547 – Atlanta

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Why you may want to seek help from a Corporate Fraud Investigator

October 15, 2010 by Staff Editor Leave a Comment

If you are aware that your business is suffering from internal theft you likely have a CPA or CFE working on gathering accounting evidence to identify the source of the problem, maybe you contacted an attorney to lead the quest or play a role. What you may not be aware of is the option to contract hire a corporate fraud investigator as a link in the chain of your corporate fraud investigation, or how they fit with the experts already on the task.

Typically a good CFE (Certified Fraud Examiner – usually a CPA with specialized training and certification) will find the forensic evidence needed to point towards suspects. This is similar to how an attorney gathers evidence and information to build a case that he or she believes will win the favor of a judge panel or jury in court.

A good corporate fraud investigator with a loss prevention background will often come into play when interviewing employees and or interrogating suspects. This specific skill set is based on training from organizations such as the John Reid & Associates Institute or Wicklander – Zulawski & Associates. These skills lead the corporate fraud investigator to orchestrate interviews in a particular order and style based on the evidence compiled by the CPA – CFE etc… The results are written confessions through non confrontational techniques and a complete case file that can be handed over to authorities ready for processing in criminal court if desired.

Calling a corporate fraud investigator up front may help avoid some costs in the overall process depending on the experience of the CPA and or attorney on the case. The trained investigator can help guide the investigation offering some specific direction to the team that will reduce the amount of time necessary to land on a confession. This saved time means saved dollars spent on hourly fees etc…

For more information visit: corporate fraud investigator

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The Evils of Corporate Fraud

October 12, 2010 by Staff Editor Leave a Comment

You want to know about corporate fraud ? Well you have but to look in the direction of one of the biggest scandals of the last decade: Enron. In October of 2001 the company announced a $638 million loss in third-quarter earnings. The next month they publicly admitted to overstating earnings for the past four years by $586 million. As a result the company’s stock plummeted costing thousands of employees their jobs, retirement savings, 401K plans, etc. You would think that such a debacle would cause companies to stand up, take notice and put necessary safeguards in place, but in fact statistics indicate that corporate fraud is still on the rise today.

The number of fraud cases between 1998 and 2007 have increased compared to the previous 10 year period. The most common fraud techniques are improper revenue recognition (lying about how much money you made) and overstatement of assets (lying about how much your company is actually worth). The most common motives for this fraud are the need to meet internal/ external earnings expectations, an attempt to hide the company’s financial condition and, my personal favorite, the desire to increase management compensation (ie. I lied so it would look like I was doing a good job and therefore I could justify receiving a raise).

The long-term consequences of corporate fraud are bankruptcy, material assets sales and possibly de-listing from a stock exchange. However, the individual commits this type of crime is motivated to do so by short-term goals. Most CEO’s and CFO’s have their compensation tied to the company’s short-term stock performance so it is in their personal best interest to make things seem brighter than they really are. The fact is that until the boards of directors are held responsible for their actions corporate fraud will persist.

For more information about employee theft or corporate fraud investigation contact us about Corporate Fraud or call 1.770.426.0547

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Reasons you may want to get help with an employee theft investigation

October 11, 2010 by Staff Editor Leave a Comment

There are reasons why you may want to get help with an employee theft investigation and by help I do not mean calling the police (I’ll get back to that).

When you get an idea you may have a problem with internal theft you likely have a rush of thoughts and feelings about what is happening to you/ your business and maybe even some thoughts about specific employees you feel may be suspect of internal theft. Often times business managers and owners make the fatal mistake of reacting in a way that alerts the thief and allows them to cover tracks and or prepare themselves for accusations. Sometimes the knee jerk reaction is to point fingers at employees too quickly, those who are innocent. These reactions can cause some damage to the team and effectiveness of any organization.

Back to the police…calling the police before you have a proper case documented including a written confession can blow your chances of ever getting justice. Police are simply not trained to be experts at internal theft / corporate fraud and they are not likely to conduct a corporate fraud investigation or employee theft investigation when they have piles of dangerous criminals committing crimes regularly, missing children to find and so on. It is simply a matter of not being a priority and I do not mean that in a negative way against law enforcement in any way.

Hiring a professional for your employee theft investigation who knows how to build a rock solid case with proof including getting written confessions is a very smart and cost effective way to get solutions. And it insulates you from the employees protecting you from creating uncomfortable feelings with your good employees in the process.

To learn more visit: employee theft investigation

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