Payroll Fraud Article Review
Running head: Article Review
Shawn Detamore
Davenport University
January 29, 2012
Payroll fraud schemes happen when an employee generates overcompensation for themselves. There are three types of payroll fraud schemes; ghost employees, bonus and commission schemes and falsified hours and salary (Shields, 2009). This type of fraud accounts for 17% of fraud that is committed in organizations (Shields, 2009).
Back in May of 2009, a payroll manager and a retired employee of the Detroit Public School system worked together to steal over $400,000 from the school. They scammed the school by forming a payroll scheme. The payroll manager, Toni Gilbert cut checks to Anthony Carter who had retired back in 2000. When Toni did this, Carter not only received his retirement check, he was also receiving a regular paycheck from the school.
This “extra” check that Carter received was split between himself and Mr. Gilbert. Gilbert had worked for the school for over 20 years. In those twenty years, five of them were spent committing fraud. Since the fraud was committed at a school, this constitutes as a federal crime. They were stealing money from the taxpayer dollars. If they are convicted, both employees will face a maximum sentence of 10 years in prison and have to pay a fine of $250,000 (Detroit).
Luckily for DPS, the financial Manager and DPS office inspector are the ones that caught the corruption. Since the indictment, DPS is hoping to send out a strong message that fraud will not be tolerated. They have also started doing more investigations with the FBI to stop any other fraud that is occurring at DPS. So far, they have found two employees that have been using sick days to work at other jobs. DPS is already a troubled school system (Detroit). Ensuring that fraud is at a minimum will help to keep this school around.
The significance of this article was even if someone works for a company for years and you put all your trust in them, they still commit fraud.
Shawn Detamore
Davenport University
January 29, 2012
Payroll fraud schemes happen when an employee generates overcompensation for themselves. There are three types of payroll fraud schemes; ghost employees, bonus and commission schemes and falsified hours and salary (Shields, 2009). This type of fraud accounts for 17% of fraud that is committed in organizations (Shields, 2009).
Back in May of 2009, a payroll manager and a retired employee of the Detroit Public School system worked together to steal over $400,000 from the school. They scammed the school by forming a payroll scheme. The payroll manager, Toni Gilbert cut checks to Anthony Carter who had retired back in 2000. When Toni did this, Carter not only received his retirement check, he was also receiving a regular paycheck from the school.
This “extra” check that Carter received was split between himself and Mr. Gilbert. Gilbert had worked for the school for over 20 years. In those twenty years, five of them were spent committing fraud. Since the fraud was committed at a school, this constitutes as a federal crime. They were stealing money from the taxpayer dollars. If they are convicted, both employees will face a maximum sentence of 10 years in prison and have to pay a fine of $250,000 (Detroit).
Luckily for DPS, the financial Manager and DPS office inspector are the ones that caught the corruption. Since the indictment, DPS is hoping to send out a strong message that fraud will not be tolerated. They have also started doing more investigations with the FBI to stop any other fraud that is occurring at DPS. So far, they have found two employees that have been using sick days to work at other jobs. DPS is already a troubled school system (Detroit). Ensuring that fraud is at a minimum will help to keep this school around.
The significance of this article was even if someone works for a company for years and you put all your trust in them, they still commit fraud.
References: 2 Indicted in DPS Payroll Scheme. (2009). Retrieved January 29, 2012 from http://www.clickondetroit.com Shields, A. (2009). Payroll Fraud. Retrieved January 29, 2012 from http://dolmanbateman.com.au/964/payroll-fraud/