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Cash is the lifeblood of any organization. All organizations have cash flowing both in and out. Research indicates that about 92% of all asset-theft fraud schemes involve cash, with median losses of $65,000 per incident. About 66% of cash schemes involve outgoing cash (disbursements) and 34% involve incoming cash (receipts).
Case Studies
As a sales representative for a medical supplies vendor, "Mark Price" sold medical supplies directly to doctors at local hospitals. Mark had a falling-out with his employer and was fired. Mark continued to work with the hospitals as if he were still a representative of the vendor and hand-delivered false invoices printed on stationery he had kept after his termination. One hospital refused to pay the false invoices because receipt of the invoiced items could not be verified. Another hospital, which did not have an organized system for keeping track of incoming supplies, paid the false invoices by giving checks directly to Mark, rather than mailing them. Using an endorsement stamp from his former employer, Mark stamped, dualendorsed, and deposited the checks into his personal bank account. Mark stole about $200,000 in less than a year before his scheme was discovered.
As a hospital employee, "Linda Jones" was responsible for receiving, recording, and depositing incoming payments from insurance providers and patients. For three years, Linda exploited these incompatible responsibilities and diverted cash to herself. Stolen checks were either swapped for cash internally or were dual-endorsed and deposited directly...