Question

It is often argued that the best people to detect crime are those who know how to commit the crime. With this in mind, how would you commit the perfect fraud? You can use your organization or a “fictitious” organization. What weaknesses would you look to take advantage of? How would you make sure that your fraud was not detected? If you had to identify one item that would be the greatest deterrent to you – what would that be? Your posting should demonstrate that you understand fraud from the inside.

Answer 1

In an organisation where the right to create/edit the vendor bank details is available with the person responsible for making payments, there exist high chances of manipulation in the vendor database.

If i were the person in charge for making payments, i would negotiate with a vendor, a payment term of 70% of actual budget of the company but would raise the PO at full value in the favor of vendor, but would put my family's bank details in the vendor master. In this way, full payment gets credit to my family member's account and i would withdraw and pay 70% to the vendor and keep the balance 30%. This way, the concerned department will not doubt, as they are receiving the service, i will be the one processing payments, so i will have the opportunity to replace vendor's original invoice with fake invoice of higher value.

Greatest deterrent for me would be termination from the job followed by a legal action, as had that have happened with any one in the past, i wouldnt even dare to think about comitting a fraud in such a company.