ACC 667 Topic 3 DQ 1
Select an example of a corruption case and discuss how a
perpetrator would commit this type of fraud and what types of
internal controls management could implement to help to prevent
or detect this type of fraud. Solid academic writing is expected,
and any sources used should be cited. In your response, do not
use the same example as already posted by a classmate.
, Instructor's Comments:Dear Raquel, Thank you for your
respectful post and corruption example. Continue to share your
interpretations of research. They add value to your learning
community. Best, Dr. Deb
According to the Association of Certified Fraud Examiners'
(ACFE) fraud tree, an area of corruption is bribery. One form of
bribery are kickbacks (Association of Certified Fraud Examiners,
2019). This occurs when an employee receives a financial benefit,
usually cash, from a vendor for preferential treatment. For
example, an employee may arrange to purchase goods or
services from a vendor at an inflated price. In return, the vendor
agrees to kickback some of the extra money to the employee. In
another example, an employee in a trusted position could arrange
for the purchase of fake products or services. The collusion with
the vendor would then involve splitting the funds received.
There are steps an employer can take to implement controls
related to kickbacks. Like other fraud risks, a company should
have a well established and communicated policy concerning
kickbacks and consequences. It also helps to have recurring
employee training related to ethics. A lot of kickback fraud cases
are discovered because they are reported by coworkers and
vendors. Providing simple and safe methods of reporting fraud is
an important control. A company should also have strong controls
related to vendor relationships. A process should be in place to
establish, validate, and approve vendors to ensure they are valid.
Procurement policies should also review charges and vendor
billing to ensure that costs are realistic and in line with competing
vendors (Munoz, 2017).
Fraud magazine, a publication by the ACFE, has an article
related to kickback schemes. The article describes an auditor’s
engagement to investigate a tip of kickback fraud. The fraud was
committed by an executive at National Steel Corporation (NSC).
Select an example of a corruption case and discuss how a
perpetrator would commit this type of fraud and what types of
internal controls management could implement to help to prevent
or detect this type of fraud. Solid academic writing is expected,
and any sources used should be cited. In your response, do not
use the same example as already posted by a classmate.
, Instructor's Comments:Dear Raquel, Thank you for your
respectful post and corruption example. Continue to share your
interpretations of research. They add value to your learning
community. Best, Dr. Deb
According to the Association of Certified Fraud Examiners'
(ACFE) fraud tree, an area of corruption is bribery. One form of
bribery are kickbacks (Association of Certified Fraud Examiners,
2019). This occurs when an employee receives a financial benefit,
usually cash, from a vendor for preferential treatment. For
example, an employee may arrange to purchase goods or
services from a vendor at an inflated price. In return, the vendor
agrees to kickback some of the extra money to the employee. In
another example, an employee in a trusted position could arrange
for the purchase of fake products or services. The collusion with
the vendor would then involve splitting the funds received.
There are steps an employer can take to implement controls
related to kickbacks. Like other fraud risks, a company should
have a well established and communicated policy concerning
kickbacks and consequences. It also helps to have recurring
employee training related to ethics. A lot of kickback fraud cases
are discovered because they are reported by coworkers and
vendors. Providing simple and safe methods of reporting fraud is
an important control. A company should also have strong controls
related to vendor relationships. A process should be in place to
establish, validate, and approve vendors to ensure they are valid.
Procurement policies should also review charges and vendor
billing to ensure that costs are realistic and in line with competing
vendors (Munoz, 2017).
Fraud magazine, a publication by the ACFE, has an article
related to kickback schemes. The article describes an auditor’s
engagement to investigate a tip of kickback fraud. The fraud was
committed by an executive at National Steel Corporation (NSC).
