Never Sleep While Your Money Works!

A recent trip to Dubai has reinforced my belief that we need to pull our financial fingers out here in the UK if we want to keep up with the rest of the world. We manufacture, own resources and attract tourists, yet we spend our time arguing the toss about Europe and Scottish independence when we should be protecting what we have achieved over the centuries.

It was my second trip to Dubai, though my first was 40 years ago when the dhows lined the Creek and there was a choice of one pizza restaurant to visit, so it probably doesn’t really count. This time I was impressed not with the tall skyscrapers, straight 12 lane freeways and spotless pavements, but with the pride in which both the locals and resident migrant workers took in their country. Having to return to militants doctors, Jeremy Corben and packed trains made me feel quite sad.

I spend my working life dealing with problems surrounding money. More specifically it is the attempts people make to obtain more than they deserve or to hide that which they have obtained illegally. In this respect, Dubai is just as vulnerable as the UK, especially so given its rapid rise as a global centre of finance.

Fraud and money laundering is never apparent to the onlooker, but I know that wherever there is wealth there is somebody trying to gain an illegal share. Even when organisations are state run, or run by trusted family members, there is ample opportunity for the crooks. Sophisticated operators take advantage of often complacent management that thinks just because the staff are paid generously there is little chance of theft. To give an example of the sometimes over confident attitude I recall a conversation with a senior representative of a (very) large Dubai enterprise regarding fraud security within his organisation. After explaining a few of the obvious fraud controls that needed to be applied to any large company, I was rewarded with the comment, “…but what would you be doing after you had finished…?”

The esteemed gentleman believed that once his business had been “checked” for fraud risk, there would be nothing more to do! The problem is that properly ensuring the safe custody of billions worth of assets and turnover is a never ending task. An international corporation is a dynamic entity, changing, growing and consolidating continuously. Even when sound controls are in place, an ever vigilant watch needs to be maintained to ensue that weak points in the business do not emerge, or can potentially be created by the fraudster.  A watching brief is the most valuable tool you can employ, as it makes the fraudsters keep their heads down!

There is an old adage that used to be circulated by some of the over confident fraud “specialists” in recent years. In return for a commission to review a business, they would guarantee to uncover enough fraud equal to at least a weeks exorbitant consultancy fees. Of course this was not a gamble but an easy win, as all multinational businesses employing thousands of staff will enjoy a substantial leakage due to over claimed expenses. Demonstrating this is a simple task for a moderately competent fraud specialist. I prefer to deal with this problem for free, and concentrate on the risk of major loss.

Although fraud prevention is one of my specialist areas, I do not enjoy trying to explain to the client that the best defence is vigilance and not to be complacent. I am always afraid this advice is like asking somebody not to be stupid! It is the same when investigating tax saving schemes and asset tracing through offshore banks. Just because a method or conduit has worked for a while, it should come as no surprise that the authorities eventually find a way to challenge a tax saving venture. The message – act now before the fraudsters – or the authorities – take your money!

 

About Mark Jenner

Mark Jenner is an experienced forensic accountant specialising in fraud and white collar criminal matters. He provides independent financial investigation and expert accounting witness services to police forces, fraud regulators and criminal defence lawyers, also providing assistance and solutions to organisations embroiled in financial disputes.

One Response to Never Sleep While Your Money Works!

  1.  avatarRashmi Panchal says:

    Excellent Post Mark – I’m sure a lot of work awaits you in the future in Dubai – complacency usually leads to fraud even in the most robust of organisations.

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