Occupational Fraud Essay

529 Words2 Pages

I think fraud is the act of one person using false pretenses to get something they want or need from someone else. According to Wells (2017, p. 2), “fraud can encompass any crime for gain that uses deception as its principal modus operandi.” Wells (2017, p. 3) goes on to state “under common law, four general elements must be present for a fraud to exist:

1. A material false statement
2. Knowledge that the statement was false when it was uttered
3. Reliance of the victim on the false statement
4. Damages resulting from the victim’s reliance on the false statement.”

Occupational fraud also involves the use of false pretenses to obtain something of value but with occupational fraud, it typically involves employees or others associated with a business or group of businesses. Occupational fraud can be many different things, including embezzlement, theft of cash, false billing schemes and many others. The end result of occupational fraud is the culprit(s) receives money or other items of value at the expense of their employer or another business without the employer or other business’ knowledge or consent. …show more content…

While the analysis developed three broad categories of occupational fraud – corruption, asset misappropriation, and financial statement fraud – the individuals completing the analysis recognized there are multiple subsets to each of the categories. The fraud tree allows for the subsets to be addressed based on their individual characteristics.

As mentioned in Wells (2017), not all deception is in fact fraud. With is thought in the back of our minds, the Fraud Tree will be important to this class because it will assist us in determining if there is a fraud being perpetrated and if there is, then what type(s) of fraud are being conducted by the perpetrators based on the facts of the

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