Where is Fraud Likely? - Part 4

Larceny Often Starts with the Credit Card Charges

Auditors suspecting fraud often start by analyzing the credit card charges of those who are in a position to perpetuate fraud.  Why?  The person stealing from the business entity often starts small and they often start where it is easiest to steal.  Falsifying credit card charges is the easiest place to start.

On one audit, I was analyzing credit card charges.  The company president took three people to dinner and wrote their names on the credit card slip.  I knew it was fraudulent because one of the people listed on the slip was me, and I knew I had not been there.  I then checked and found the date was a Saturday night.  When confronted, the company president admitted that he had taken personal friends to dinner and charged the evening to the company.

Once you find fraud in the credit card charges, you can look at other places where that person could have perpetuated fraud.

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