Book Review: Profiling the Fraudster
No matter how good and strong a company’s internal control is, if the human resource department who create and run the chain of control are inherently dishonest, then the chance of the organization being exposed to fraud is large. While traditional fraud investigations focus on breaking down internal control, the book ‘Profiling the Fraudsters’ examines fraud prevention methods by profiling, recognizing, and studying the behavior and characteristics of potential fraud perpetrators who are trusted to safeguard assets.
Profiling itself, according to the book, is the collecting of various pieces of information and data or intelligence related to criminal or criminal offenders. The information collected is then formulated into a profile that can be used to model potential fraud offenders in the future. This method is part of an effective anti-fraud management program.
This book is divided into three parts. The first part is Occupational Fraud and Corruption which generally discusses the definition of occupational fraud and corruption, the causes and impacts on the organization as well as trends that occur. The second part is Profiling the Fraudster. In this section, the author describes how profiling is used to fight occupational fraud. It also mentions red flags, how motivations and opportunities can be indicators of fraud behavior, and the individual behavior and characteristics of a fraud perpetrator. And the last part is Building a Fraud Profiling Methodology for Your Organization, which explains, among other things, how companies can obtain and collect pieces of information, the process of building a fraud profile, and the role of HR in the recruitment process in profiling.
This book also shares examples with readers to help them better in understanding. One of them is how whistleblowing systems are a great source of information that can ultimately be used in profiling.
The author, Simon Padgett, is a passionate, qualified ACCA (UK) Accountant with a Canadian CPA license. He is also a CFE with experience in Forensic Accounting and Investigations, Anti-Fraud Programs, Internal Audit, Risk Management and Corporate Governance.
This book is recommended for corporate fraud investigators, law enforcement, accounting and financial professionals who want to learn more about fraud detection and prevention.