Fraud or “theft” has been occurring since the first days of humankind. It is a reality that will never go away and no person or organization wants to be a victim, especially on their watch. There is no typical demographic for an individual who commits fraud. Whether public, private or not-for-profit, every organization is at risk of potential fraud.
NOT FOR PROFIT,
Board of Directors
When not reading about cyberattacks and information security breaches, occupational fraud/employee fraud are stealing headlines (pun intended)
employee benefit plan,
Let's consider the following scenario: Your organization enforces mandatory vacations in an effort to prevent occupational fraud. A current employee is perpetrating a fraud scheme involving a fictitious employee and must access your accounting system bi-weekly to continue the fraudulent activity. Unfortunately for you, employees are allowed to work from home and the fraudster in question simply logs in after-hours and performs the necessary steps to maintain his/her scheme.
This scenario highlights the importance of IT controls, as we see that the fraudster was able to circumvent the organization's anti-fraud efforts by taking advantage of a weakness in the IT control environment.