Why I Should be Marketing Fraud Prevention Services

Monday, November 16th, 2009 at 11:11 am 
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As an investigative forensic accountant specialising in fraud I offer a wide range of different fraud related services to businesses and individuals in diverse locations. It occurs to me that there are two very closely linked subject areas of work within my business of providing asset tracing in cases where some form of asset recovery is being sought and providing fraud prevention advice to companies looking to protect themselves from the risk of fraud.
Why should I consider these to be linked? The reason is that the failure to properly consider a sensible fraud prevention strategy leads to frauds happening with the need for lengthy and complex investigations. It is by failing to heed the dangers of fraud that the fraud takes place!
The revenue that I would receive from providing fraud advice to even a larger organisation on how to establish appropriate fraud policies, defence plans and preventitive controls is modest when compared to a relatively minor fraud. In addition, the fraud would also require the services of legal advisors to deal with it through the courts or perhaps through employment tribunals and the like. It would also take up a lot of the organisations own resources and would likely be highly disruptive. This is even more likely to be the case if the law enforcement authorities become involved in a criminal investigation! 
Please do not think I am complaining as I actively enjoy investigating fraud, but I feel that it is in an organisation’s best interests to spend its money on receiving the greatest value for money. By investing a little on installing a fraud policy and reviewing fraud prevention measures the company is reducing the risk of suffering a major fraud by a huge amount. Any fraud will have a serious financial impact and often can cause a company to fail. Many of my investigations are on behalf of the insolvency practitioner called in to invetsigate the workings of a failed business.
The old adage of “…it will never happen to me…” rings true. We are are guilty of it and unfortunately will continue to be so, not only in our business affairs but also in our day to day life. We do not excercise enough, eat the wrong foods (or too much of it) and drink too much alcohol. Then when we are ill or unhealthy in our old age we say ‘…if only…’
In the same way fraud is a sinister threat to everybody. It destroys businesses and individuals alike. The fraudsters are all around us, driving their expensive cars and enjoying a lavish lifestyle. We don’t seem to notice – but it is time we started treating fraud like the major crime that it is and fraud prevention, not fraud investigation, should be the major service for which I receive enquiries!
My ‘to do’ list for this week includes taking a good look at any missed real business opportunities that I have being a forensic accountant if I do not actively seek out businesses that are unprotected from fraud and try to help them. At present I do give this help, usually after a fraud has taken place and the need for proper contols are at the fron of a victim’s mind!

Asset Recovery – an overview

Tuesday, October 27th, 2009 at 10:44 am 
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MAJ portrait AvatarIt is possible to divide asset recovery into a number of different camps depending on the circumstances giving rise to the need for claiming back money or goods that rightfully belong elsewhere. 

The first of these areas include criminal asset recovery or confiscation, from fraudsters and other criminals who benefit from their crime such as drug dealers or those that deal in human trafficking.  Such asset recovery is carried out through the criminal justice system but can also involve civil asset recovery using both the civil and the criminal courts depending on the circumstances.

The next area is the asset tracing and recovery from fraudsters or persons or organisations involved in sharp business practice through the civil courts.  This involves civil litigation through the civil courts.

Last but not least is the recovery of assets from insolvent individuals and organisations.  This is recovery of assets after the fact, attempting to trace assets that should be available to creditors of the insolvent entity.  A fraud investigator investigating such losses must need to be aware of both criminal and civil considerations when dealing with bankruptcies, receiverships and liquidations.  An insolvency will normally be investigated under the provisions contained within the Insolvency Act 1986 which details of numerous criminal offences.

Whatever powers and provisions used to investigate and recover assets, there can be no better outcome to asset recovery than when negotiated settlemement and recovery is achieved.  This means that costly litigation is avoided and a fraudster may well avoid the most serious sanctions if he pays the money back. 

When deciding to investigate a loss due to fraudulent activity with a view to recovering assets an understanding of the likelihood of recovery must be obtained before substantial resources are expended on protracted analysis, interviews and other research.  This is to reduce the risk of the gamble taken as to whether or not an asset recovery action will be successeful.  It is quite easy for legal fees to reach six figures and more when asset freezing injunctions, search orders, financial investigations and legal counsel are employed by lawyers progressing a case.  This is why it is always a good idea to have a fraud response plan in place within any organisation (in addition to a fraud policy) which sets out how to act if a fraud or loss is suspected.  Provisions can be made for an immediate and totally confidential appraisal by a fraud expert in order that the correct decisions can be made at the start and costly mistakes avoided.