From: http://www.baselinemag.com/c/a/Intelligence/Identifying-the-Fraudster-in-Your-Company-863593/

Identifying the fraudster in your company:

"Who commits fraud in your company? He may be one of your hardest-working and most trusted colleagues, someone who is often stressed, rarely takes vacations, and protects his business unit from scrutiny while personally attending to the top vendors. That’s the profile of a typical fraudster produced by KPMG International, revealed in its study of global fraud. The research draws on nearly 350 actual investigations conducted by KPMG member firms in 69 countries, and it shows that the majority of cases exhibited at least one red flag that should have triggered intervention. Yet only 10% of these cases resulted in action before requiring a full-blown investigation. Patterns of fraud often remain undetected for years, costing millions. Senior management must be proactive, supporting a robust ethics and compliance policy while providing an easy way for employees to report an issue without fear of retaliation, all while maintaining appropriate due diligence."

While we tend to think of computer crime as outside hackers, many fraud events are actually inside jobs. It might be a disgruntled employee, mad since he didn't get a promotion, or upset that somebody doing about the same job gets more money. Sometimes the person gets started just on a lark, and then goes farther and farther.

Can such a person gain from the fraud? Depends, can he (or she) sell the information to a competitor? Can he (or she) sell account numbers on the black market? Can he (or she) use the information to open credit card accounts in the names of customers? Can he (or she) move money and funds to a secret account?

When I worked at Citibank's credit card division, the federal banking regulations required that a person take a two week consecutive days off vacation. This dated back to the depression of the 1930's where bankers could daily swap the books and accounts to make the bank look solvent. (Like if Mrs. Smith comes in to withdraw her money, the banker quickly moved money from Mr. Jones' account to Mrs. Smith). It was thought that a two week vacation should 'tell' if fraud was occurring. I'm not sure if that federal requirement is still in force in these days of being able to adjust accounts electronically from home.

So, when you become managers, watch out for insider fraud as well as outsider fraud, and have the controls and communications in place to enforce your actions!!!