Fraud is an ongoing problem worldwide, costing companies billions. It is a serious criminal issue that can damage a company’s reputation, lead to legal fees and fines, or worse, result in losses from loss of business. While fraud is not always preventable, it can be controlled by having a clear fraud policy in place and creating a competent investigation team.
It is important to understand the different types of fraud schemes. There are many types of occupational fraud, such as check fraud, credit card fraud, mortgage fraud, and healthcare fraud. Other types of fraud are specific to an individual, such as identity theft, phishing scams, and advance-fee schemes.
Once a fraud case is initiated, a fraud investigator must determine the facts of the allegation. This is done by reviewing documents, conducting interviews and collecting evidence. A fraud investigation should follow a consistent format to ensure that all information is documented and easily accessible. Using a fraud management system is recommended to keep records in order and allow for quick review by the team.
Once the team has gathered all the information, it should make an assessment of whether or not fraud occurred and if any laws were violated. The investigation should also include a determination of the potential impact on the company’s reputation, financial performance and legal liability. This assessment can be a critical factor in making the decision to pursue a criminal or civil prosecution of the alleged perpetrator of the fraud.