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Fraud-Tree Schemes

The document describes different types of occupational fraud categorized as corruption, asset misappropriation, or financial statement fraud. It provides definitions and examples for each type of fraud, as well as statistics on the percentage of cases each type represents and the median loss. The types of fraud include corruption, theft of cash or inventory, skimming, billing schemes, payroll schemes, and check tampering among others.

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784 views

Fraud-Tree Schemes

The document describes different types of occupational fraud categorized as corruption, asset misappropriation, or financial statement fraud. It provides definitions and examples for each type of fraud, as well as statistics on the percentage of cases each type represents and the median loss. The types of fraud include corruption, theft of cash or inventory, skimming, billing schemes, payroll schemes, and check tampering among others.

Uploaded by

sulthanhakim
Copyright
© © All Rights Reserved
We take content rights seriously. If you suspect this is your content, claim it here.
Available Formats
Download as PDF, TXT or read online on Scribd
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the fraud tree

occupational fraud and abuse classification system

Click on occupational fraud categories below with the i icon to view definitions and statistical
information from the ACFEs 2016 Report to the Nations on Occupational Fraud and Abuse.

i
Corruption

Asset
Misappropriation

Financial
Statement Fraud

Net Worth/
Net Income
Overstatements

Net Worth/
Net Income
Understatements

Invoice
Kickbacks

Timing
Differences

Timing
Differences

Bid Rigging

Fictitious
Revenues

Understated
Revenues

Concealed
Liabilities and
Expenses

Overstated
Liabilities and
Expenses

Improper
Asset
Valuations

Improper
Asset
Valuations

Improper
Disclosures

Improper
Disclosures

Conflicts of
Interest

Bribery

Purchasing
Schemes
Sales
Schemes

Economic
Extortion

Illegal Gratuities

Inventory and All


Other Assets

Cash

Theft of Cash
on Hand

Theft of Cash
Receipts

i
Skimming

Sales

Unrecorded

Understated

Receivables

Write-Off
Schemes
Lapping
Schemes

Unconcealed

Fraudulent
Disbursements

i
Cash Larceny

Refunds
and Other

Billing
Schemes

Payroll
Schemes

Expense
Reimbursement
Schemes

Misuse

Check
Tampering

Register
Disbursements

Asset
Requisitions
and Transfers
False Sales
and Shipping

Ghost
Employee

Mischaracterized
Expenses

Forged Maker

NonAccomplice
Vendor

Falsified
Wages

Overstated
Expenses

Forged
Endorsement

Personal
Purchases

Commission
Schemes

Fictitious
Expenses

Altered Payee

Multiple
Reimbursements

Authorized
Maker

Shell
Company

Larceny

False Voids
Purchasing
and Receiving
False Refunds
Unconcealed
Larceny

Corruption
A scheme in which an employee misuses his or her influence in a business transaction in a way that violates his or her duty to the employer in order to gain a direct
or indirect benefit.

35+65+D
35.4%
of cases

median loss:

$200,000

Asset Misappropriation
A scheme in which an employee steals or misuses the employing organizations
resources.

84+16+D
83.5%
of cases

median loss:

$125,000

Financial Statement Fraud


A scheme in which an employee intentionally causes a misstatement or omission
of material information in the organizations financial reports.

10+90+D
9.6%
of cases

median loss:

$975,000

Theft of Cash on Hand


A scheme in which the perpetrator misappropriates cash kept on hand at the victim
organizations premises.

12+88+D
11.5%
of cases

median loss:

$25,000

Inventory and All Other Assets


A scheme in which an employee steals or misuses non-cash assets of the victim
organization.

19+81+D
19.2%
of cases

median loss:

$70,000

Skimming
A scheme in which an incoming payment is stolen from an organization before it is
recorded on the organizations books and records.

10+90+D
11.9%
of cases

median loss:

$53,000

Cash Larceny
A scheme in which an incoming payment is stolen from an organization after it has
been recorded on the organizations books and records.

8+92+D
8.4%
of cases

median loss:

$90,000

Billing Schemes
A scheme in which a person causes his or her employer to issue a payment by
submitting invoices for fictitious goods or services, inflated invoices or invoices for
personal purchases.

22+78+D
22.2%
of cases

median loss:

$100,000

Payroll Schemes
A scheme in which an employee causes his or her employer to issue a payment by
making false claims for compensation.

9+91+D
8.5%
of cases

median loss:

$90,000

Expense Reimbursement Schemes


A scheme in which an employee makes a claim for reimbursement of fictitious or
inflated business expenses.

14+86+D
14.0%
of cases

median loss:

$40,000

Check Tampering
A scheme in which a person steals his or her employers funds by intercepting,
forging or altering a check or electronic payment drawn on one of the organizations bank accounts.

11+89+D
11.4%
of cases

median loss:

$158,000

Register Disbursements
A scheme in which an employee makes false entries on a cash register to conceal
the fraudulent removal of cash.

3+97+D
2.7%
of cases

median loss:

$30,000

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