Types of food fraud. 1. Intentional fraud. 2. Unintentional fraud. 3. Fraud that is harmful to health. 4. Fraud that is not harmful to health.

1. Intentional fraud.
2. Unintentional fraud.
3. Fraud that is harmful to health.
4. Fraud that is not harmful to health.

1. Types of food fraud. 1. Intentional fraud. 2. Unintentional fraud. 3. Fraud that is harmful to health. 4. Fraud that is not harmful to health.

2. TYPES OF FRAUD Fraud can be as minor as a theft of office supplies or as serious as defrauding investors and creditors through elaborate accounting schemes. Fraud may be classified into three broad categories: Assets Misappropriation. This usually involves misappropriation of cash, either through outright theft, skimming of cash

3. receipts, or fraudulent cash disbursements. However, asset misappropriation also can involve non-cash assets, such as computers, vehicles or inventory. Embezzlement is the illegal use of agencies funds by the person who controls the funds, and can go undetected when proper segregation of duties is not in place.

4. Acts of embezzlement may include: Double cheque fraud , which occurs when the employee writes two cheques each time a bill is paid; one cheque is sent to the vendor and one cheque is sent to the employee. Cheque kiting, which is when an individual draws a check for more than the amount available in the account. The employee deposits the check and withdraws from a second account. The employee deposits the amount back into the original account before the bank registers the transaction or check clears the first account.

5. PAYROLL FRAUD Payroll fraud can occur in a few different ways. An example of payroll fraud includes processing payroll for a fictitious employee. Fictitious employee fraud occurs when an employee fabricates time and attendance entries to another employee who does not exist, and therefore, does not provide services to the agency. The fraud takes place when this fictitious employee’s payroll is redirected to the bank account of the employee who is committing the fraud.

6. CHEQUE FRAUD - OTHERS Cheque fraud is among the oldest and most common forms of financial crime. Even with the advent of electronic payment products, cheques still account for billions of payments each year, making them a prime target for criminals. There are three main types of cheque fraud: Counterfeit - cheques not written or authorized by legitimate account holder Forged - Stolen cheque not signed by account holder.

7. Altered - an item that has been properly issued by the account holder but has been intercepted and the payee and/or the amount of the item have been altered

8. HOW YOU CAN PROTECT YOUR AGENCY FROM CHEQUE FRAUD. Reduce the use of cheques in favour of electronic payments such as wire payments, direct deposit and pre-authorized payments Choose envelopes that make cheques hard to detect while in transit. This helps to minimize the risk of cheques being intercepted Keep cheque stock in a secure location Destroy unused cheques from closed accounts immediately Checks and Balances - split responsibilities so that no one person is responsible for cheque issuance and reconciliation

9. Prompt account reconciliation - Reconcile your statements as soon as they are received. To speed things up, many clients see a significant advantage in products like: Use of internet banking platform Positive Pay, which matches cheques presented against your own cheque issue files and identifies all exceptions for a Pay/No Pay decision Corporate Clearing, which helps large volume cheque issuers manage the daily processing and reporting of paid items

10. When re-ordering cheques, use a continuous set of serial numbers Order only one set of cheques per account When laser-printing cheques, issue multiple passwords to those responsible for cheque printing and use cheque paper with toner anchorage to permanently bond toner ink into the paper Use high quality cheques employing a reasonable mix of security features. Report any old outstanding cheques and suspected fraud on your account immediately.

11. Overtime Reporting Fraud, which takes place when employees overstates their hours worked, which goes unnoticed by their supervisors. Another example of overtime reporting fraud could be when an employee and supervisor conspire to overstate and falsely approve the employee’s hours in return for a kickback of the compensation.

12.   FRAUDULENT FINANCIAL REPORTING. Governments are exposed to the risk of each of these types of fraud. However, according to the ACFE study, two specific types of fraud account for more than 50 percent of the instances of fraud within the government environment:

13. Billing schemes and corruption . Billing schemes occur when a government pays invoices an employee fraudulently submits to obtain payments he or she is not entitled to receive. Versions of billing schemes include the creation of a shell company or ghost vendor, purchasing a product with government funds and returning it for a personal refund, or charging personal purchases to the government. Common warning signs for these schemes include:

14. Increasing “Soft” Expenses. In most cases, soft expenses such as transport and travelling, motor running, accommodation expenses etc are increasing at a rate that is very unusual in the organisation or department. This raises a red flag to account reviewing officers in the department, putting them on enquiry or suspecting fraud.

15. Vendors with PO Box addresses, Where vendor’s addresses are stated with p.o box only, this is often done to conceal the possibility of tracing such vendors to their appropriate addresses. In most cases, such vendors do not exist.

16. Vendors listed as initials. Many vendors listed as initials such as DBA LTD , HLM Enterprises etc, are very good red flag flyers. These abbreviations are usually not the real names of the companies but are used to conform to names of accounts opened by the fraud perpetrator for ease of clearing payment cheques. Excessive voided or missing checks . Where cheques are voided in multiples or various cases of missing cheques being reported by accounts officer, management need be Be put on enquiry for imminent fraud.

17. INTERNAL THEFT. Another area of fraud within government agencies is internal theft. An employee may steal company assets for personal use or resale. Employees may steal small amounts of inventory at a time, which accumulate to a large amount over time. Internal theft can also be the result of over-ordering products, such as office supplies, in small increments. The responsible employee.

18. uses the unneeded items for personal use or returns the items, keeping the cash.

19.   SKIMMING Skimming is the act of an employee intercepting a payment from a company before the transaction is ever recorded; therefore, it cannot be matched with records and detected. An employee that could commit skimming would be one with direct contact to a customer or one that handles cash transactions.

20. FRAUDULENT STSTUTORY FINANCIAL REPORTING. Fraudulent statutory financial reporting is the act of deliberately issuing misleading financial statements in order to protect the financial reputation of the entity and falsely satisfy the needs of financial statement users. Agencies may modify their financial statements by altering revenue recognition through sham transactions, prematurely recognizing revenue, tampering with percentage of completion account, inflating their sales numbers, or billing for uncompleted services.

21. CORRUPTION. Corruption occurs when government employees or officials accept bribes, illegal or inappropriate gratuities, kickbacks or excessive gifts or when government employees or officials experience conflicts of interest. In the state and local environment, corruption schemes are made possible by the fact that most governments award service contracts through a competitive bidding process. The official supervising the process could be tempted to accept a bribe or kickback from a bidder in exchange for awarding that vendor a contract. Ultimately, corruption schemes cause governments to overpay for services (since the lowest bidder would likely have been selected had corruption not taken place), thus benefiting the perpetrator at the expense of taxpayers.

22. WHEN FRAUD OCCURS During the past year, stock prices have plummeted, the housing market has collapsed, and the economy has faltered. The ripple effects from these events have caused significant financial difficulties for many people. Accordingly, the temptation for employees to commit fraud schemes as a quick way of getting cash has increased significantly. This financial pressure to commit fraud is one of the three components of the “fraud triangle,” along with rationalization and the perceived opportunity to commit fraud. These three components are present in every fraud.

23. While pressure and rationalization are largely out of a government’s hands, governments do have the ability to reduce perceived and actual opportunity.

24. FRAUD TRIANGLE