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What is fraud? and how can it be prevented or detected?

<p><a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.4.wegf.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNFnamFfJbpBE-_hEDayLciOTdExeg">Act</a> or course of deception, an intentional <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.5.100g5.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNHuQvz5LnJP54cjQVI4r7a7nSgCHQ">concealment</a>, <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.6.zx4j.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNGBnOUS3NWln4PhYh7dXgpb1sBfEA">omission</a>, or perversion of truth, to (1) <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.7.x4hs.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNGfvcIzZTG7OHDdheBNrMRJ76I93A">gain</a> unlawful or unfair <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.8.wl48.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNFEESj66BBrtjEhxNhl67PBzwinOg">advantage</a>, (2) induce another to part with some valuable item or <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.9.100g6.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNE6sRlK5-8SwH9NfXbDFDNnJEz_Lg">surrender</a> a <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.10.wegm.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNFsHe2B0cbGdbw5shj3bbXv3EdKSw">legal</a> <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.11.wdm8.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNG8fzzT0PbZfTecE80od1UX2q-9UA">right</a>, or (3) inflict <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.12.wtyu.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNFmxPwy4CaSEahqao_jUdNj7vkXzw">injury</a> in some manner. <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.13.100g7.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNHQVKJIKUvYqL-eKKqEfwuaN3oHMw">Willful</a> fraud is a <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.14.100g8.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNGPmTFREFKTexP7BUhTZUoSb0mt2g">criminal offense</a> which calls for <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.15.100g9.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNE3MPopnpS2oql-BZ80uYnenAykCQ">severe</a> <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.16.yed5.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNHmnL2AjnhHLdBpbsHhsdPczwBL5g">penalties</a>, and its <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.17.xd43.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNG-GNAb5SK0BLv4xBCVVyCVgzwy1Q">prosecution</a> and <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.18.wvmi.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNHE0BcXX6tTAFPS50MvSua3W8enng">punishment</a> (like that of a murder) is not <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.19.wgfs.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNG7PFtj1QyoqMnwNDXugrmMU2f1tg">bound</a> by the <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.20.100ga.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNFPztNqRu5lJZyhHmiQuuLsjcr3xw">statute of limitations</a>. However incompetence or <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.21.wtyq.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNGFkEJARgXYGguTSXXACIHAHYEFpg">negligence</a> in managing a <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.22.wenm.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNFJ2SDfMIm-YYs8XGDxsMrtN66BoQ">business</a> or even a reckless <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.23.y7ah.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNHOKUatnH5mDbIDe5Qrl7yAWLWlnQ">waste</a> of firm's <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.24.wl3u.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNENbtYb7Wq4wEnR3G7_t4UCKqmHNg">assets</a> (by speculating on the stock market, for example) does not normally constitute a fraud. In such <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.25.xluo.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNG6vimd5yQeUS43qMVxCoXTZq27ug">cases</a>, the <a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.26.ybos.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNG5F_zVgxcpZTTrfHEWJ1EVHqJvfA">aggrieved party</a> (<a href="http://www.google.com/url?q=http%3A%2F%2Ft.ms00.net%2Fs%2Fc%3Fu.t97w.27.y8zv.54tw6&amp;sa=D&amp;sntz=1&amp;usg=AFQjCNGJ3yGhPUwb9k6I5pPGOaMZ6H1jyA">creditors</a> or stockholders/shareholders) must prove that at some point they were intentionally deceived on ...</p>

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Question added by Musa Muhammad Dandikko , Ag. Head of Procurement , Federal College of Education, Katsina
Date Posted: 2014/10/25
Mohammad Shamim Ahmad
by Mohammad Shamim Ahmad , Senior Supervisor-Internal Control & Compliance , WOQOD - Qatar Fuel

Fraud is defined as " dishonestly obtaining advantage, avoiding an obligation or causing a

loss to another party "

Fraud Prevention

The aim of preventative controls is to reduce opportunity and remove temptation from potential offenders. Prevention techniques include the introduction of policies, procedure and controls, and

activities such as training and fraud awareness to stop fraud from occurring. Some specific prevention

techniques include

Anti Fraud culture

Risk awareness

whistle blowing

sound internal control systems

 

Fraud Detection

A common misbelief is that external auditors find fraud. This is actually rarely the case-in fact , most frauds are discovered accidentally, or result of information received (whistle blowing)

some methods of discovering frauds are

1. Performing regular checks (stocktacking and cash counts,reconciliation )

2. warning signals or fraud risk indicators for example

    Failures in internal control procedures

    Lack of information provided to auditors

    Unusual behavior by individual staff

    Accounting difficulties

3. Whistleblowing

 

 

Thaikkattil Mathew Joshi
by Thaikkattil Mathew Joshi , Group Credit Controller , Gps Group,Dubai.

 

Answer: Fraud encompasses an array of irregularities and illegal acts characterized by intentional deception.

It can be prevented by those factors contributing to fraud:

1.Seggragation of duties.

2.Limit the access to assets.

3.Execute transactions with proper authorizations.

4.Lack and unqualified personnel.

5.Collusuon among employees.

 

Regards,

 

Joshi Mathew

CIA #1036906 

Azhar Kabir
by Azhar Kabir , BANKING SERVICES MANAGER ( BSM ) , Allied Bank Ltd

wrongful or criminal deception intended to result in financial or personal gain.

closely supervision of internal matters of any organization

mohamed Hakim CMA CPA Candidate
by mohamed Hakim CMA CPA Candidate , Accounting Manager , Andersen saudi arabia

Good answer Muhammad shamim 

Muhammad Umair Arain
by Muhammad Umair Arain , General Accountant , Heart Beat Medical Center & One Day Surgery LLC

it seems all options give are matched on def of fraud 

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