The CFO'S Perspective

Your most Important Tip: If you receive an email asking you to wire money or send gift cards, assume it is a fraud – every time. CALL the sender to confirm, at a number you know is correct.

We are seeing, and hearing about, an increasing number of online scams and other negative internet-based activity related to COVID-19 and the mass exodus from company offices to home offices.  

As thousands of information workers recreate office processes and routines to work in an online-only world, the scammers, spammers, information manipulators, and meeting hijackers have been busy as well.

There are professions that most people would consider trustworthy. Doctors & nurses, firefighters, and teachers all come to mind.  How about accountants?  Do you trust your bookkeeper?  The reasonable answer here is: Yes!  Trust is often built over time, through relationships and evidenced by past and ongoing performance.  The reality is, if you didn’t trust your employees, they probably wouldn’t still be working for you.

This is Part 3 of a series on the causes of a perfect employee fraud scenario.  Read “Employee Fraud Factor #1: Pressure” here, and “Employee Fraud Factor #2: Opportunity” Part 2 here.

In case you missed Part 1 & 2, there was once a really smart guy, Donald Cressey, who created a theory that said: “If three factors were met, any ordinary, trusted person could bring themselves to commit fraud.”

This is part 2 of a series on the causes of a perfect fraud scenario.  Read “Employee Fraud Factor #1: Pressure” here.

In case you missed Part 1, there was once a really smart guy, Donald Cressey, who created a theory that said: “If three factors were met, any ordinary, trusted person could bring themselves to commit fraud.”

In other words, given the right situation (or perhaps wrong situation), anybody could commit fraud.  Not just criminals, not simply “unethical” people, and certainly not just somebody ELSE’s accounting staff.

The three factors include:

>  Pressure
>  Opportunity
>  Rationalization

In Part 1 we talked about the first factor, Pressure, and how a person with an apparently SECRET financial problem might feel no other option than to steal company money.  They are on the prowl for just the right opportunity!

Consider which of these you believe to be true:

• Your bookkeeper is honest and would never steal from you  -> FALSE
• All the people you’ve hired are ethical people  -> FALSE
• A person is either ethical or not ethical, period   -> FALSE
• People who commit fraud are long-time criminals, waiting to pounce  -> FALSE