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Closing The Loop – Fraud Investigations

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Here is an excellent article from Bank Fraud Forum on Fraud Investigations.   It provides a good picture of the challenges that take place in most internal audit departments and corporate investigative groups.   After you read the excerpt below, you can click the link at the bottom of the post for the full article:

“Oh what a tangled web we weave, When first we practice to deceive – Sir Walter Scott

Unraveling complex internal fraud schemes can be exceptionally challenging. As my fellow countryman puts it, the web that fraudsters weave can be relatively logical or completely unstructured and seemingly random.

Most internal fraud investigations involve an interrogation of the suspect(s) to determine guilt or innocence. During my career, I have been lucky enough to conduct hundreds of interrogations (or as HR likes to call them interviews). I have had the privilege of learning from many highly trained interrogators from local, state and federal law enforcement. Very early on in my fraud career, they taught me a very valuable interview approach that I believe many interrogators neglect to utilize. The approach, if used appropriately, can close the loop and dramatically improve a banks ability to prevent internal fraud.

An interrogation with a fraud suspect involves many phases including establishing a baseline, information gathering, the confrontation, the confession etc. However, once a confession is provided by the employee many investigators stop the interview, suspend the employee and return to the office. That is a mistake.

The employee has just admitted their role in the scheme. Often, employees appear almost relieved. Certainly, some are distraught, others may be aggressive, but for those that express a sense of relief, now is the time to truly help the bank stop more fraud.
Consider asking the relieved employee the following types of questions….”

To read the rest of the story from Bank Fraud Forum, click the link below:

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  1. September 9, 2014 at 10:41 AM

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