Discovering a Fraud

It is always a disappointment when you discover that a trusted member of your team has been defrauding you or the company you work for. The impact on the business could be very extensive as the committing of the fraud will also subsequently bring other parts of the business into the investigation/resolution process. These other areas may include Human Resources, Legal, Finance and Internal Audit.

During this initial stage, it’s important to remember the legal consequences to your actions. The computer that was being used by the alleged fraudster could hold important evidence that could be used in a future civil or criminal litigation. Do you know the correct procedure for handling this evidence? How are you handling paper documents that may be relevant to the alleged crime?

It is in these situations that a forensic accountant with criminal investigation experience can assist you. It’s their job to co-ordinate the initial investigation, liaise with external legal advisers, the Police and the various departments in your company.

Once the potential evidence has been secured and other information is collated then the next phase is to decide whether the Police should be notified and action taken to recover the funds. A qualified Forensic accountant can also ensure that the information provided to the Police is in the correct format. This will increase the likelihood that the Police will prosecute the matter.

Once the dust has settled and the matter is being properly investigated, it is then time to ensure that the fraud can not be perpetrated again. An assessment of where the breakdown in internal controls occurred will allow changes to be made to prevent the loss from re-occurring.

Whilst this article outlines some basic advice, given the sensitivity of these situations and the potential legal consequences, we recommend that you seek expert advice if you find yourself in this situation.


Rushmore (Author)

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