Advanced Accounting: Discussion Post: Types of Fraud: Bayo Cary

April 11, 2015

Discussion Post: Assignment 7: Types of Fraud

Miss Bayo Elizabeth Cary, A.A., B.A., M.L.I.S.  

Home/Cell: 001-352-262-9733 Toll Free US: 1-888-571-011

Fax: 1-352-433-1875 Email: bayo.cary@yahoo.com

     Fraud can occur in almost any work environment. One of the best ways to prevent fraud in the workplace, is to screen work applicants thoroughly, during the job application process. Once an individual has been hired, it is important that the new hire, is brought up-to-date, on the workplace policies-supporting fraud prevention. An alarming number of frauds, in the workplace, go unreported, because employees are afraid of being labeled a: "Whistle blower," and thus being stigmatized, and ostracized, at work.

    

      Employers need to have in place, various safe avenues, so that employees can safely report acts of suspected fraud, in the workplace anonymously. Once a suspected fraud has been reported, it is then up to the management, to investigate. Following through, with an investigation, of suspected fraud in the workplace, is key to the prevention, of future fraudulent acts, in the workplace. In addition to suspected frauds being reported, by employees, another method of fraud discovery in the workplace, is by an auditor, who comes to check a business’s financial records, for anomalies-which indicate possible fraud in the workplace.

    

       If an auditor detects suspicious information, while checking through a business’s financial records and information, then, the auditor, who is not as specialized as a fraud investigator, will suggest, that the business hire a fraud investigator, to look into anomalous financial reports. If the fraud investigator, finds sufficient evidence, against an employee, which confirms fraudulent activity, against the business, then, the investigator, will urge the business to prosecute. The fraud investigator, plays a key role, in assisting the prosecution's case, when an act of fraud, in a workplace, is being resolved, through the court system. 

     

        Accounting fraud, is fraud, is fraud committed by altering the financial and accounting reports and statements, of a business, to place the business in a better light. After the financial, and accounting statements, of a business have been altered, to place a business in a more favorable light: stock prices might stabilize or increase, more shares of stock might sell, and /or, more individuals, may choose to invest in the business in other ways, and, it may be easier for the business to gain additional financing, such as bank loans.

    

      Consumer fraud, occurs when vendors lie to consumers, about products and services, to swindle money and information, out of the consumers. Consumer fraud can be used to steal bits and pieces, of consumers identifying personal information, such as: address, phone number, etc., that later, can be sold to the highest bidder, or later, can be used in addition, to other identifying information, to create: fraudulent bank accounts, fraudulent employment applications, etc. .It is extremely important, that consumers monitor their credit reports, and scores, and keep track, of all: private, confidential, and personal identifying information-including passwords and PIN numbers.

      

       Organizational fraud, is fraud that is committed within an organization. Organizational fraud can be headed by a group of employees, or, organizational fraud can be committed, with the assistance of management. Most often, organization fraud is committed within an organization, as an act of collusion. Organization fraud, can be difficult to stop, if management is involved, in the acts of fraud, which are being perpetrated, against a business. The fact is, that fraud occurs in the workplace sometimes, therefore, businesses must work hard to protect against, all three, of the above mentioned fraud types.