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February 2017 newsletter


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February 2017 newsletter

  1. 1. 1 | P a g e ISSUE 2 | VOL 2 | FEBRUARY | YEAR 2017 Employee Fraud……………………1  Employee Fraud: The enemy Amongst us, moving from problem To Solutions………………………..2  Types of Fraud………………….….3  Word Search………………………. 4  Upcoming & Recommended Events ……………………………...5-6  Experts Articles…………………….7 KAW"ESTABLISHING RELATIONSHIPS BUILT ON TRUST" “A check up a day can keep Employee Fraud away! Why prevention is better than cure.” Employee Fraud is an attempt to commit fraud against a company or organization that the employee is working for. It is actually the fastest growing and one of the most costly crimes in the world. Many of you reading this article would have already fallen victim of Employee Fraud or would have witnessed one or more Employee Fraud incidents. If you have not, you either don't realize you have, or you do not understand the red flags or it is just a matter of time. Employee Fraud is a major concern for organizations locally, regionally and worldwide. The need to implement and enhance internal controls in our businesses is more critical than ever. Internal Auditors and HR Professionals, in particular, play a crucial role in detecting and preventing Fraud during their internal assessment process, recruitment, as well as, enforcing ethical policies in the workplace. A business can lose millions in revenues to Fraud simply because employees are not pre-screened properly during his/her interview during the employment process or they are not being monitored and assessed during the course of employment. Sometimes our businesses encourages Employee Fraud by simply not putting internal controls or Anti-Fraud Programs in place. In some cases, the crime may be so small it forever goes unnoticed or turns out to be the catastrophic blow a business never recovers from. KAW Management Services Limited can help you and your business to conduct and implement Anti-Fraud Assessments, build Anti-Fraud Programs that will assist you in identifying Fraud Risk Areas and also minimize or curtail Fraud in your organizations. We are passionate about educating businesses and individuals so that they can be more aware of the various scams and schemes so commonly carried out in workplace. Billions are stolen from governments and businesses worldwide every year based on statistics. If someone really wants to steal from you, they will figure out a way to do so and try to hide it or cover their tracks. Our recommendations are not to cure Fraud, but if implemented by Boards and Management, they can certainly help to minimize or make it difficult to happen. Contact us at KAW and we will be ready to assist. Remember that any comments and queries can be sent to us at; or or visit our website at
  2. 2. 2 | P a g e “A check up a day can keep Employee Fraud away! Why prevention is better than cure.” Employee Fraud can be a major problem for businesses especially small ones that cannot sustain the revenue loss shock. Undetected Employee Fraud can cause serious financial damage to a business, as well as, reputational risk and loss in employee morale. There are many different types of Employee Fraud, including misuse of company assets, corruption, money laundering, embezzlement, to name a few. Misuse of assets is one of the most common forms of Employee Fraud, because it can come in so many ways. The use of company supplies for personal use, such as simply creating fictitious debits, submitting false expense claims, or browsing the internet when you should be working and working with customers and supplies in order to get a kickback, are just a few. Employers can do a lot to protect themselves against this type of fraud by creating a culture of ethics, setting the tone from the top, increasing vigilance and security, having proper pre-screening and ongoing monitoring of employees and reducing the opportunities for fraud occurrence through the implementation of strong internal controls. Educating employees can also help. In many cases, individuals are seriously unaware that basic little acts that they are involved in are actually fraudulent. Corruption may sound like a harsh crime reserved for politicians, but it can be a form of Employee Fraud, as well. Corruption often occurs when an employee offers discounts, services or preferential treatment in return for personal profitable gain from an outside individual or business without approval from their superiors and not following policies and procedures. Employee Fraud is a serious and costly problem throughout the business world, and can occur within any business or organization, whether small or large. The Fraud Triangle demonstrates that for a fraud to occur there must be opportunity, an employee has a motive or under pressure and then they simply rationalize. These three factors explain how and why employees commit fraud. Employers can do a lot to minimize or prevent Employee Fraud by attempting to remove the arm of the triangle call “Opportunity”. KAW Management Service Ltd. specializes in Anti-Fraud Services that can prepare and provide solutions in combating Employment Fraud. If you need advice, KAW Management Service Ltd. can provide you with superior service to ensure that your business and information stay secure and safe.
  3. 3. 3 | P a g e Types of Fraud Investigated by the Office of the Inspector General By: Catherine Leahy Scott Inspector General In addressing fraud within the workers' compensation system, the Office of the Inspector General conducts investigations into the following types of fraudulent conduct: Employee Fraud Occurs when an employee knowingly and intentionally misrepresents, or causes another to misrepresent a material fact about an injury for the purpose of obtaining, or helping another obtain workers' compensation benefits to which they are not otherwise entitled. The misrepresentation must be knowingly made as an inadvertent or unintentional misstatement is not fraud. The misrepresentation must have been made for the purpose of obtaining or denying benefits, and important enough to impact upon receipt of those benefits. For example, a misrepresentation by an employee that they were 25 years of age when, in fact, they were 22 years of age would not be a material misrepresentation constituting fraud unless the age difference was somehow significant to the claimed injury and to the determination of workers' compensation benefits. Examples of Employee Fraud  Filing a claim for an injury that did not occur on, or has no relation to the job.  Lying about work status when questioned directly, such as at a deposition or a hearing, while receiving temporary disability benefits.  Misrepresenting the severity of a claimed injury. Employer Fraud Occurs when an employer knowingly misrepresents facts about its employees in order to obtain a workers' compensation coverage for a premium price that is less than what the employer would otherwise be obligated to pay if all the facts about its employees were known to the issuer of the policy. Also occurs when an employer knowingly misrepresents facts to avoid, deny or obtain compensation on behalf of employees, or knowingly lies about entitlement to benefits to discourage an injured employee from pursuing a claim. Examples of Employer Fraud  Under-reporting the number of employees  Misclassifying employees as independent contractors  Misrepresenting the nature of the work performed by the employee  Misrepresenting past loss experience  Misrepresenting the company ownership  Falsely informing an employee that workers' compensation benefits are only available if he or she has been employed for six months or more. Health Care Provider Fraud Occurs when a health care provider knowingly and intentionally submits a material misrepresentation about medical treatment afforded a workers' compensation claimant in a bill or invoice that the health care provider presents to the Board or to the insurance carrier for payment. Health care fraud includes frauds committed by any provider in the workers' compensation system, such as doctors, rehabilitation counselors, pharmacists, or chiropractors. Examples of Health Care Provider Fraud  Billing for exams of patients who were never examined  Billing for treatment of patients who were never treated  Duplicate billing in order to receive payment from different insurance carriers for the same medical treatment  Billing follow-up exams as "first exams" to receive greater payment from the carrier  Bundling unnecessary medical services with necessary services  Misrepresenting the true code for the medical treatment provided
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  7. 7. 7 | P a g e EXPERT ARTICLES Fraud Mitigation Prevention Best Practices - Preventing Fraud Employee Training ... in order to identify potential trends for further review of possible fraud ... July 2016 Pull for review random QC ... Financial Transactions and Fraud Schemes © 2016 Association of Certified Fraud Examiners, Inc.... Analytical review ... Financial Transactions and Fraud Schemes Top Ten Reviews - Official Site Top Ten Reviews is the ... turning your paper documents into digital files and helping manage your employee ... Identity theft covers more than credit card fraud. Employee expense reimbursements: Legitimate or fraudulent? Employee expense reimbursements: Legitimate or ... routed to the reporting manager for review and... Of Internal Control & Anti-Fraud Experts ABC15 uncovers out-of-control waste, abuse and fraud inside federal power agency ABC 15 Phoenix7 days ago as a little-known agency that has a big impact on tens of millions of people and their electric bills, experts said. “It’s one of the most important agencies...statements and receipts ... inside-federal-power-agency Detecting Occupational Fraud in Canada: Introduction. Detecting Occupational Fraud in Canada: A Study of its Victims and Perpetrators ... trated by an employee, manager, executive or owner of an. Report to the Nations on Occupational Fraud and Abuse Median Loss and Median Duration by Detection Method... 25. Source of Tips. ..... with fewer than 100 employees) was the same as that in- curred by the largest... What Are the Different Types of Employee Fraud? - wiseGEEK Feb 17, 2017. There are many different types of employee fraud, including misuse of assets, Corruption, embezzlement or financial fraud, and worker's compensation fraud