Forensic Accounting Methods

A fraud can be uncovered in many differentThe investigator will approach the discovered
ways. A good example is by the routine activitiesfraud by first determining what the organisation
of the internal audit team or alternatively by awants to get out of the investigation. This might
whistleblower who who might inform hisbe simply to get the money back or it might
managers that a colleague has been fraudulentlywant to make an example of the fraudster as a
stealing from the company. Corporate fraudlesson to others. If it just wants to get its losses
needs to be investigated quickly in order toback it may not welcome law enforcement
prevent further losses impacting the organizationinvestigating as this might disrupt its business or
and to find out how the fraud happened in thecause its reputation to be damaged. For example
first place. It may be possible to recover anya bank might not want the general public to know
losses that have taken place by tracing themthat it had allowed a fraudster to work in its
from the company to their destination.midst.
A specialist fraud investigator is appropriate forThe forensic accountant or certified fraud
such a task and it is often the case that theexaminer will want to plan the outcome of the
victim company will enlist the services of amatter with the company and develop an
qualified forensic accountant. Such a person will beinvestigation strategy based upon any contingency
accredited by one or more professional bodies topolicy or "fraud response plan". It may be possible
investigate a fraud matter. He or she may be ato interview the whistleblower early on to get a
Chartered Accountant or a Certified Fraudquick "heads up" into what was going wrong
Examiner with possibly other qualificationsbefore beginning a detailed analysis of the
together with many years of experience dealingaccounting records, interviewing staff and making
with such cases.other enquiries often outside the organisation.
Every fraud is different. There are variousFor the actual approach to the investigation the
distinguishing characteristics to be found between,forensic accountant will most likely want to follow
for example bank fraud, insurance fraud andthe trail of the stolen money. "Follow the money"
mortgage fraud. Even in these categories therewill be the primary goal as this will provide not
may be many possibilities for different problemsonly a chance of getting the money back, but
because the fraudster is very resourceful inalso evidence of why and how the fraud took
seeking out new and different weaknesses in aplace.
business.