Miller Fraud Case Study

Case 5-1
1- Miller fits the profile of a typical fraudster by him working in the accounting department and is male. Also in Miller’s case he was never charged or convicted. According to the Association of Certified Fraud Examiners (ACFE), a typical fraudster is a male and has no problems with the law and having a clean record. The ACFE states that more than 80% of frauds where committed by individuals working in accounting, operations, sales, executive/upper management, customer service or purchasing. On the other hand, Miller doesn’t fit the profile by him not having any financial problems which makes him driven to commit a fraud. The most common behavioral red flags displayed by the perpetrators were living beyond their capability with about

Committing a fraud is like misappropriating assets or taking bribes, Miller committed frauds by forging checks to steal money. Miller was able to go around signing checks because he was working in a high ranking position. He used to trick colleagues to sign to 2 checks if it needed further authorization if they went on a vacation. Concealing a fraud is like lapping or knitting, Miller would conceal a fraud by returning canceled checks from bank and destroy checks that he used for siphoning to his personal account. The amount stolen was charged to the unit expense to balance out the company’s books. Converting the theft or misrepresentation to personal gain, Miller will cash checks he has forged to his personal account. He would use this stolen cash for his expensive lifestyle and his

The company’s reputation will be damaged if they report a fraud. This will move away investors or other interested parties from investing in the company and this might cause bankruptcy. The company could lose a lot of business due to the bad publicity. It is difficult to prove if a fraud happened in the company and many law enforcement lack the knowledge and the experience of fraud. It is costly and takes time for a company to investigate a fraud case. Sometimes when fraud cases are prosecuted, the sentences they receive is very light compared to what they have done to the company. This discourages companies to report fraud. If the company doesn’t report a fraud on the other hand would have many problems. First of which, those who have acted illegally may think that they have not received any consequences to their actions and might repeat their actions in another workplace. Also not reporting the fraud might show other workers that the organization is weak and not willing to take actions. The law officials should be educated more about fraud and increasing more strict sentences. The law enforcement should make it obligatory to report the fraud.

6- In Miller case, the company should separate financial duties of employees which means that the employee who writes the checks should not be the employee who reconciles the bank statement. The company should have stronger internal