The internet is a place of both great opportunities and countless scammers and opportunists as well. People who wish to start an online business or career may often find themselves the most attractive and potential prey for internet scammers and frauds.
Here Jarl Moe list of items to help you detect scam in your company or a client’s company.
1. Unusual Behavior
The perpetrator will often display unusual behavior, that when taken as a whole is a strong indicator of scam. The fraudster may not ever take a vacation or call in sick in fear of being caught. He or she may not assign out work even when overloaded.
Frequently tips or complaints will be received which indicate that a fraudulent action is going on. Complaints have been known to be some of the best sources of scam and should be taken seriously.
3. Stale Items in Reconciliations
In bank reconciliations, deposits or checks not included in the reconciliation could be indicative of theft.
4. Missing Documents
Documents which are unable to be located can be a red flag for a scam. Although it is expected that some documents will be misplaced, the auditor should look for explanations as to why the documents are missing, and what steps were taken to locate the requested items.
6. Excessive Credit Memos
Similar to excessive voids, this technique can be used to cover the theft of cash. A credit memo to a phony customer is written out, and the cash is taken to make total cash balance.
7. Common Names and Addresses for Refunds
Sales employees frequently make bogus refunds to customers for merchandise.
8. Increasing Reconciling Items
Stolen deposits, or bogus checks written, are frequently not removed, or covered, from the reconciliation. Hence, over a period of time, the reconciling items tend to increase.
9. General Ledger Out-of-Balance
When funds, merchandise, or assets are stolen and not covered by a fictitious entry, the general ledger will be out of balance.
This type of scam can include manipulating a company’s records in relation to more favorable loan terms, an improvement in year-end bonuses, or influencing the stock price. But don’t worry Jarl Moe is here to help you to detect all types business scam.