Some types of frauds, identified

July 21, 2016 Written by

As I’ve noted before, there are many types of frauds and they can take all forms. Here are a few of them.


Lapping of receivables – This is a situation where someone steals a payment on account and uses the next payment to pay off the balance stolen. Over time it becomes harder to perpetuate this fraud and eventually the account receivable is written off as a bad debt to cover up the theft


Phantom Employees – Straight forward enough, a false employee is created and a payroll check written. This has become easier to pull off with direct deposits as a check is never issued to the employee.


Theft of inventory – This can take many forms from simply walking off with the inventory to not turning in parts that need to be exchanged for credit.


These are only a few examples and obviously with proper segregation of duties and controls, these can be prevented. If we can help identify any problem areas and solutions, feel free to give the office a call.



Written by: Doug Rodrigues