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Next Edition Topics:
Resumé Fraud: More prevalent than you might think. (J. Beard)

This edition of VantagePoints presents two articles dealing with managerial fraud, both in connection with the reimbursement of expenses supposedly incurred in the course of regular business operations.
In both cases, large corporations purchased companies that complemented their operations and became subsidiaries. Managers that stayed on with the subsidiaries after the transition were entrusted with large expense accounts, and both abused the trust by defrauding the parent company of vast sums.
When it comes to expense reimbursement issues, It's Your Move - Make it Count®. The professionals of ResultQuest® can arm you with techniques to avoid expense account fraud - or to prove and remove it.
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Founder, Owner, and Manager

Fox in the Henhouse: How keeping the former owner on board can cost you 

Our investigators were called in to assist the general counsel of a major oilfield services company that had purchased an established construction company. The oilfield services company opted to keep the construction company's' founder on a multi-year contract to manage the newly acquired subsidiary, and aid in the transition.

A few years after the acquisition, an auditor noted some inconsistencies in the subsidiary's aviation expenditures, most of which involved charges for an aircraft being used to ferry work crews to an overseas location. The company that owned and operated the corporate jet was, in fact, owned by the founder of the subsidiary. He had negotiated a side contract for oilfield crew air transport services as part of the sale of the construction company.
By tapping into an aviation background, the investigator was able to document that the former owner had manipulated aircraft registration numbers to buy a used jet, refurbish and upgrade it at the expense of the subsidiary, and then sell it at a personal profit - while making it appear that it was ordinary repair and maintenance work being done on a different plane covered under the lease.
Further, the investigator was able to identify, ...
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That's how we've always done it: Vague expense reports
One of the easiest and most common ways for a fraudster to come away with ill-gotten gains at the expense of the employer or contractor is through expense reports. Policies regarding the detail in which expenses must be submitted for reimbursement vary widely, and some companies are either too lax or have no coherent rules at all.
The general counsel of the refinery cleaning subsidiary of a multinational waste management firm employed us to investigate the expense account of the manager of the company's facility in Port Arthur, Texas. An extensive probe revealed the manager to be carrying out a broad and systematic pattern of defrauding the employer by submitting personal charges on business expense reports.
The manager's Illicit expenses that were revealed in the course of the investigation included: lumber and other supplies to build a beach home, jewelry purchased for a paramour, lodging and meals at a luxury casino, and maintenance and repair materials for an apartment complex owned by the manager.
Interviews of the manager's superiors uncovered ... Read More