Archive for the ‘Beyond Fraud’ Category

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26
Apr/101

The Embezzler. James M. Cain. Avon Book Company, 1946. A Great Read!

I found this great book on employee embezzlement and bought it on-line.  Used, it cost me a few dollars.  The title – “The Embezzler.”

What a great book.  It is a simple story of a bank employee embezzling from the bank customer’s savings accounts, and how a superior bank employee discovers the theft.

What made this book and story interesting enough for me to start and finish it in one night, 160 pages, something I never do, is that the scheme and the details around the scheme, including how it was detected, quantified and supported, is as applicable to day as it was when this was first written, in 1936.  Just another example of how fraud really hasn’t changed over time.

The setting is interesting, being 1936, but the writer had accurate details on how this would have occurred, perhaps with the assistance of a subject expert at that time.  I may never know, given the age of the story, but substitute any one of my on-going existing embezzlements into this story, and I can see it still working as it did back then.

If the field of embezzlement and fraud is one that interests you, I highly recommend you read this book, if you are fortunate to find a copy still available.

A movie was produced in 1940 based on the book, called “Money and the Woman.”.  Here is a link talking about the book and movie:

http://booksintofilms.com/support-files2/cain4.htm

The Embezzler.  James M. Cain.  Avon Book Company, 1946.

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22
Feb/1012

Do Credit Card Companies Bring Fraud On Themselves?

I just don’t understand when certain things occur that make no sense to me.

Today, for instance, I received a booklet of courtesy checks at my home.  These courtesy checks are linked to a corporate credit card I maintain for my firm.  All the information regarding the account pertains to the business: firm name, address, phone number… My monthly statements go directly to the firm address, as does all communications regarding the account – rightfully so – that’s the way I set up the corporate account.

So why then would this well-known, highly publicized card issuer send unsolicited courtesy checks to my personal residence that were prepared using my name (not the firm’s name) and my personal residence address (not the firm’s address) to be drawn against my account, when I would not be expecting such checks???

A few years back we had an experience with bank fraud.  In closing a relative’s estate a savings account was opened to accumulate any funds for estate purposes.  No checks were requested or issued, and no debit card was requested.  Simply a bank account to accumulate any funds until the estate was distributed.  So how surprised were we when we received a call from the fraud unit of the bank alerting us to potentially fraudulent activity on the account using a debit card???  Turns out the bank on it’s own accord issued a debit card on the savings account, and sent it to an old address used more than twenty years ago.  The current residents of that address received a windfall when the debit card arrived out of the blue in their mail – unbeknown to us.

Seems to me that although the credit card companies complain they fall victim to fraudulent activity and suffer the losses, their own actions in some part (perhaps a large part) contribute to fraud and could have been prevented if they simply stopped sending out unsolicited information (or worse courtesy checks) to cardholders not expecting the materials.

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21
Feb/103

Great Article – Theft of Receipts Schemes Thriving

This article appearing February 21, 2010 illustrates two key points I highlight in my writing and speaking. First – theft of cash receipts schemes continues to be the method of choice, stealing payments intended to employers and diverting them for personal use. Second – sharing information during an investigation often leads to additional discoveries and information.

This individual was accused of stealing $171,000 in payments payable to the organization, a non-profit working with disabled children no less. Then, by sharing information with the individual’s prior employer, the prior employer discovered the same individual had stolen $335,000 in payments intended to them. Further, the same individual faces yet more charges for theft in a third context here in Connecticut.

Attorneys often provide advice, rightfully so, suggesting that communications be maintained to a minimum to limit potential exposure to the victim organization. However, if sharing of information and discussions with previous and successor employers does not occur, potential actions and thefts of an individual could go undetected forever. It is common for someone to steal, go undetected or go unprosecuted, only to obtain future employment and steal again, commonly using the same schemes of the past.

Thefts of cash receipts and payments have been the most common schemes I have encountered in the last few years.  I am convinced the ATMs and other automated depositing processes have contributed in large part to this, as the checks payable to the employer are easily deposited directly into the suspect’s account. Controls are critical for every organization over the cash receipts and deposit processes for these reasons.

Read the entire article >

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