Fraud Exposed : What You Don't Know Could Cost Your Company Millions

As an estimated $600 billion a year "industry," occupational fraud dwarfs most legitimate industries many times over. Yet the vast majority of organizations–private, public, governmental, or nonprofit–have woefully inadequate internal controls, and what energy is devoted to combating workplace fraud is generally spent on post infraction detection and punishment, rather than on cost effective preventive measures. In Fraud Exposed: What You Don’t Know Could Cost Your Company Millions, former FBI executive and corporate security chief Joseph Koletar blows the roof off the "dirty little secret" of occupational fraud, proposing new methods for reducing this extraordinary liability. Applying criminal and law enforcement response models to the workplace, Koletar analyzes seemingly disparate topics such as financial controls, organizational intelligence, and game theory to show how fraud examination methodology must change in order to become more effective. High profile, high level cases such as Enron and Global Crossing are dramatic examples of workplace crime, but they are only the tip of the iceberg. Kickbacks, large scale diversion of goods and services, and the creation of "ghost vendors" are surprisingly common phenomena in such industries as retail, manufacturing, health care, education, financial services, entertainment, advertising, waste management, and energy, costing these industries millions upon billions of dollars every year. And these costs do not simply "go away." They result in higher prices to consumers, lower profits to companies and shareholders, higher cost to taxpayers, lower bonuses to managers and executives, poorer performance on Wall Street, negative impacts on pension and retirement plans, and the failure of more than a few businesses. Fraud Exposed takes on the status quo, showing how traditional methods of dealing with occupational fraud are inadequate and how an organization’s mind set must change if it is to be more effective in dealing with this problem. Chapters discuss: Crime and the Law Enforcement Response Lies, Damned Lies, Statistics (and Occupational Fraud) Community, Corporate Citizenship, and Quality of Life Forensic Professionals as Organizational Pathologists The Next Five Years In each, Koletar debunks fraud orthodoxy, approaches the problem from a fresh angle, and presents provocative new strategies. There is no magic solution to this $600 billion problem. But Fraud Exposed presents both a startling, comprehensive account of the dilemma and a road map to reducing workplace fraud.