Occupational fraud is said to be that fraud perpetrated by an employee of an organization against his organization. According to the Association of Certified Fraud Examiners (ACFE), “occupational fraud is the use of one’s occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization’s resources or assets.” (ACFE, 2006). These perpetrators use deceit and or trickery to misuse and or steal the resources of the organization for their own personal benefits either directly or indirectly. In this paper, we want to take a look at how some of these frauds could be perpetrated.
Fraud is categorized according to type, and the three types that we want to examine here, among others falls under the category of fraudulent disbursements; they are billing schemes, check tampering schemes, and payroll schemes.. This category of fraud is said to be the most prevalent form of asset misappropriation. They are said to be committed when an employee uses his position effect payments for some transactions that are not supposed to be paid for. Fraudulent disbursements are said to always leave audit trail since cash and or checks leave the organization fraudulently after being recorded on the books. They are sometimes referred to as on-book fraud schemes.
In billing schemes, it is the purchasing function of an organization that is being attacked. This scheme is the most costly and the most popular case of fraudulent disbursement. In billing scheme, an organization is made to buy or pay for goods and or services that are either not needed by the organization, not in existent, or are overpriced. Here the fraudster creates a false support documents such as invoices, purchase orders, purchase requisitions, and receiving reports for a fraudulent transaction to trick the victim organization to issue a check(s). The fraudster stands to unlawfully gain cash, goods, and or services...