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“Fraud” going by the dictionary definition it is wrongful or criminal cheating intended to result in some gain. Fraud is always well planned and hence Fraud Investigation is a difficult task. Fraud Investigation is a process to identify & determine the scam that is done, by whom it is done and to what extent it has impacted or affected the business as a whole.
Fraud is a falsification of records or documents with the intention to deceive others. Fraud is generally against the business at a large or sometimes with a motive of taking revenge against a specific person. Fraud is the biggest risk that any business may face and can have very adverse effects like loss of reputation, financial loss, damage, embarrassment, etc. Fraud is generally committed by as employees, vendors, customers or other persons in relation to them. Such frauds are mainly against the business or the company in order to gain some undue advantage, financial gain, or with an intention to spoil the goodwill and reputation in the market. Fraud Investigations are complex because they are well planned. Hence, it can be identified only with the minute inspection.
Who initiates a Fraud Investigation Audit?
HAWK ACCOUNTING & TAX CONSULTANCY – Professionals in Fraud Investigation Audit Services in Dubai, UAE.
Call for Consultation HAWK Consultant | Partner Mob: 0505993452 Email: sales@hawk-me.com
Fraud Investigation Audit is investigating a fraud which is very much required to identify the exact depth of committed fraud. The areas where the same has impacted. It is also very much necessary to identify the loop-holes or gaps due to which such Fraud took place. Fraud Investigation Audit would help a company in assessing the actual loss incurred to a company in terms of financial & non-financial aspects. A detailed Fraud investigation report along with evidence could help in a legal proceeding (if any) carried out against it.
Generally, Fraud Investigation is initiated by the Management of the Company, Shareholders, Board, Trustees who order for the Fraud Investigation. When any of the mentioned Parties come across any doubt or instances of fraud, Investigation is ordered or initiated.
Majorly fraud can be classified as Civil or Criminal fraud. However, there are multiple subtypes of fraud that can be committed depending on the nature and type of business. Below mentioned are some of the examples:
Cash theft: Stealing cash from the counter by destroying invoices or Pocketing cash by showing cash transactions as credit.
Forging Cheque: Forging a signature on the cheque and self-withdrawing money
Manipulations: Manipulation with supporting documents and accounting fraud
Stealing Inventory: Pilferage of stock/inventory by employees
Asset theft or misappropriation: Using the company’s assets for personal benefits or for employee’s personal business
Reimbursement fraud: Claiming same expense one than once. Attaching forged supporting documents
Payment frauds: Salesman showing fake or dummy sales for more commission and reversing back the same in next months.
Bribery: Suppliers & vendors bribing employees to buy only their products
IT Fraud: IT and Internet fraud for personal benefits
Fake Suppliers: Creating fake suppliers in the books and making payments for goods/ services not availed.
Payment to Dummy Employees: By preparing dummy timesheet. This can happen with sub-contracting services where manpower supply is outsourced.
Fake Claims: Employees may charge personal purchases in the company name and record in the company’s books of accounts.
Payment frauds: Salesman showing fake or dummy sales for more commission and reversing back the same in next months.
Charities fraud: Showing dummy charities and embezzling the company funds.
Fake jobs and recruiter
Important Data theft: Stealing Contact details or confidential details of the customers and vendors to either sell or for self-use.
People usually ask
Ans: With strong Internal Controls in the Company can help in preventing & detecting frauds. With regular monitoring of system can help in preventing fraud.
Ans: Yes, the Fraud Report is mandatory to report the case and carry legal proceeding.
Ans: Yes, the Fraud Report is mandatory to report a case and carry legal proceeding.
Ans: Yes, Data theft will amount to cybercrime.
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