FIGHTING FRAUD IN THE GOVERNMENT
GLOBAL HEADQUARTERS • THE GREGOR BUILDING
716 WEST AVE • AUSTIN, TX 78701-2727 • USA
FIGHTING FRAUD IN THE GOVERNMENT
TABLE OF CONTENTS
I. INTRODUCTION TO GOVERNMENT FRAUD
Course Introduction ................................................................................................................................................. 1
Overview of Government Fraud ............................................................................................................................ 2
Definition of Government Fraud ......................................................................................................................... 2
The Impact and Significance of Government Fraud .................................................................................... 2
Video .................................................................................................................................................................... 3
The Public’s Perception of Government Organizations .............................................................................. 3
Factors Leading to Government Fraud .......................................................................................................... 3
Victims of Government Fraud ............................................................................................................................... 5
Why People Commit Fraud..................................................................................................................................... 5
Video .................................................................................................................................................................... 6
Video .................................................................................................................................................................... 8
Who Commits Government Fraud? ....................................................................................................................12
Types of Government Fraud ................................................................................................................................15
II. OCCUPATIONAL FRAUD BY GOVERNMENT EMPLOYEES
Introduction .............................................................................................................................................................17
Asset Misappropriation: Cash Schemes...............................................................................................................17
Cash Larceny.....................................................................................................................................................18
Skimming Schemes ..........................................................................................................................................19
Video ..................................................................................................................................................................21
Fraudulent Disbursements..............................................................................................................................24
Video ..................................................................................................................................................................25
Video ..................................................................................................................................................................27
Video ..................................................................................................................................................................30
Video ..................................................................................................................................................................31
Asset Misappropriation: Noncash Schemes........................................................................................................31
Misuse of Noncash Government Assets and Resources ...........................................................................32
Theft of Noncash Assets ................................................................................................................................32
Inventory Theft and Inventory Shrinkage ....................................................................................................34
Video ..................................................................................................................................................................34
Fraudulent Statements in Nonfinancial Matters.................................................................................................36
Internal Control Weaknesses..........................................................................................................................37
Red Flags of Fraudulent Statements in Nonfinancial Matters ..................................................................37
Prevention of Fraudulent Statements Concerning in Nonfinancial Matters ...........................................37
Review Questions ...................................................................................................................................................39
III. PUBLIC CORRUPTION
Introduction .............................................................................................................................................................43
Corruption Data from the 2016 Report to the Nations .........................................................................................43
Types of Corruption Schemes ..............................................................................................................................44
Bribery ...............................................................................................................................................................44
Kickbacks ..........................................................................................................................................................45
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III. PUBLIC CORRUPTION (CONT.)
Video ..................................................................................................................................................................46
Illegal Gratuities ...............................................................................................................................................46
Economic Extortion ........................................................................................................................................46
Undisclosed Conflicts of Interest ..................................................................................................................47
Video ..................................................................................................................................................................47
Video ..................................................................................................................................................................49
Breach of Loyalty .............................................................................................................................................49
Methods of Making and Concealing Corrupt Payments ...................................................................................49
Video ..................................................................................................................................................................50
Gifts, Travel, and Entertainment ...................................................................................................................50
Video ..................................................................................................................................................................50
Cash Payments..................................................................................................................................................50
Checks and Other Financial Instruments .....................................................................................................50
Hidden Interests ...............................................................................................................................................50
Loans ..................................................................................................................................................................51
Credit Cards ......................................................................................................................................................51
Transfers Not at Fair Market Value ..............................................................................................................51
False Transfers..................................................................................................................................................51
Promises of Favorable Treatment .................................................................................................................51
Video ..................................................................................................................................................................52
Red Flags of Corruption ........................................................................................................................................52
Red Flags of Corrupt Employees ..................................................................................................................52
Red Flags of Corrupt Third Parties ...............................................................................................................52
Internal Control Red Flags of Corruption ...................................................................................................53
Corruption Risk Factors ........................................................................................................................................54
Internal Corruption Risks ...............................................................................................................................54
External Corruption Risks ..............................................................................................................................54
Video ..................................................................................................................................................................55
Laws Prohibiting Public Corruption ....................................................................................................................55
U.S. Laws Prohibiting Corruption .................................................................................................................55
Video ..................................................................................................................................................................60
Video ..................................................................................................................................................................61
The United Kingdom Bribery Act .................................................................................................................63
International Anti-Corruption Initiatives .....................................................................................................66
Preventing and Detecting Public Corruption .....................................................................................................68
Anti-Corruption Policies and Procedures ....................................................................................................70
Use of Corruption Risk Assessments............................................................................................................70
Internal Controls to Prevent Corruption......................................................................................................71
Periodic Testing and Review ..........................................................................................................................72
Review Questions ...................................................................................................................................................74
IV. PROCUREMENT FRAUD
Introduction .............................................................................................................................................................77
Basics of Contract Law ..........................................................................................................................................77
Elements of a Contract ...................................................................................................................................77
Breach of Contract ...........................................................................................................................................78
Methods of Procurement.......................................................................................................................................78
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IV. PROCUREMENT FRAUD (CONT.)
Video ..................................................................................................................................................................79
Competitive Bidding Using Sealed Bids .......................................................................................................79
Video ..................................................................................................................................................................79
Contracting by Negotiation ............................................................................................................................80
Simplified Acquisition Procedures ................................................................................................................82
Video ..................................................................................................................................................................83
Employees Involved in the Procurement Process .............................................................................................84
Procurement .....................................................................................................................................................84
Accounts Payable .............................................................................................................................................85
Operations.........................................................................................................................................................85
Phases in the Procurement Process .....................................................................................................................86
The Pre-solicitation Phase ..............................................................................................................................86
The Solicitation Phase .....................................................................................................................................87
The Bid Evaluation and Award Phase ..........................................................................................................88
The Post-Award and Administration Phase.................................................................................................89
Categories of Procurement Fraud Schemes ........................................................................................................91
Collusion Among Contractors .......................................................................................................................91
Video ..................................................................................................................................................................92
Collusion Between Contractors and Employees .........................................................................................97
Fraud in Procurement Without Competition ........................................................................................... 108
Defective Pricing Schemes that Violate the U.S. Truth in Negotiations Act....................................... 113
Performance Schemes .................................................................................................................................. 116
Preventing Contract and Procurement Fraud ................................................................................................. 126
Video ............................................................................................................................................................... 127
Employee Education .................................................................................................................................... 127
Internal Controls ........................................................................................................................................... 127
Monitoring Activities .................................................................................................................................... 127
Video ............................................................................................................................................................... 128
Vendor Management .................................................................................................................................... 128
Video ............................................................................................................................................................... 128
U.S. Laws Relating to Government Contracting............................................................................................. 136
Review Questions ................................................................................................................................................ 144
V. FRAUDULENT FALSE CLAIMS AND STATEMENTS
Introduction .......................................................................................................................................................... 147
What Is a False Claim? ................................................................................................................................. 147
What Is a False Statement? .......................................................................................................................... 147
Elements of False Claim or Statement Violations .......................................................................................... 147
Common False Claims and Statements ............................................................................................................ 148
Video ............................................................................................................................................................... 149
U.S. Laws Prohibiting Fraudulent False Claims and Statements .................................................................. 149
False Statements (18 U.S.C. § 1001) ........................................................................................................... 150
Video ............................................................................................................................................................... 150
Criminal False Claims Act (18 U.S.C. § 287)............................................................................................. 151
Civil False Claims Act (31 U.S.C. § 3729 et seq.) ..................................................................................... 151
Conspiracy to Defraud Federal Government with False Claims (18 U.S.C. § 286) ............................ 152
False Entries in Federally Insured Banks (18 U.S.C. § 1005) ................................................................. 152
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V. FRAUDULENT FALSE CLAIMS AND STATEMENTS (CONT.)
False Statements on Loan and Credit Applications (18 U.S.C. § 1014) ................................................ 152
The Major Fraud Act of 1988 (18 U.S.C. § 1031) .................................................................................... 152
Civil Monetary Penalty Law (42 U.S.C. § 1320a–7a) ............................................................................... 153
Perjury (18 U.S.C. §§ 1621 and 1623) ........................................................................................................ 154
Bankruptcy Fraud (18 U.S.C. § 152)........................................................................................................... 154
False Statements in Tax Returns (26 U.S.C. § 7206(1)) ........................................................................... 154
Qui Tam Suits....................................................................................................................................................... 155
Filing a Qui Tam Action .............................................................................................................................. 155
Who Can Bring a Qui Tam Action ............................................................................................................ 156
Protections for Whistleblowers of Fraudulent False Claims and Statements ...................................... 157
Red Flags of Fraudulent False Claims and Statements .................................................................................. 158
Preventing Fraudulent False Claims and Statements...................................................................................... 158
Video ............................................................................................................................................................... 159
Review Questions ................................................................................................................................................ 160
VI. FRAUD IN GOVERNMENT SOCIAL PROGRAMS
Introduction to Fraud in Government Social Programs................................................................................ 163
Video ............................................................................................................................................................... 163
Health Care Fraud................................................................................................................................................ 164
Types of Health Care Systems .................................................................................................................... 164
Types of Health Care Fraud in Public Systems ........................................................................................ 167
Video ............................................................................................................................................................... 175
Fraud in Income-Loss Benefits ......................................................................................................................... 181
Types of Claimant Fraud in Income-Loss Benefit Programs................................................................. 181
Types of Income-Loss Benefits .................................................................................................................. 182
General Red Flags of Claimant Fraud in Obtaining Income-Loss Benefits ........................................ 185
Red Flags of Claimant Fraud Involving Disability and Sickness Benefits ............................................ 186
Red Flags of Claimant Fraud Involving Work-Injury Benefits .............................................................. 186
Preventing Claimant Fraud in Income-Loss Benefits.............................................................................. 187
Fraud in Housing-Assistance Programs ........................................................................................................... 188
Types of Housing Assistance Programs .................................................................................................... 188
Tenant Eligibility for Housing Assistance ................................................................................................. 189
Perpetrators of Fraud in Housing-Assistance Programs ......................................................................... 189
Preventing Fraud in Housing-Assistance Programs ................................................................................ 192
Review Questions ................................................................................................................................................ 193
VII. OTHER TYPES OF GOVERNMENT FRAUD
Introduction .......................................................................................................................................................... 197
Agricultural Subsidies Fraud .............................................................................................................................. 197
Forms of Agricultural Subsidies.................................................................................................................. 197
Types of Fraud in Agricultural Subsidy Programs ................................................................................... 198
Preventing Fraud in Agricultural Subsidy Programs ................................................................................ 199
Crop Insurance Fraud .................................................................................................................................. 199
Tax Evasion .......................................................................................................................................................... 204
Video ............................................................................................................................................................... 204
Types of Tax Evasion Schemes .................................................................................................................. 205
Tax Laws in the United States ..................................................................................................................... 207
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VII. OTHER TYPES OF GOVERNMENT FRAUD (CONT.)
Common Defenses to Tax Evasion Charges ............................................................................................ 208
International Tax Avoidance and Evasion ................................................................................................ 209
Counterfeit and Forged Documents ................................................................................................................. 211
Identifying Counterfeit and Forged Documents ...................................................................................... 212
Red Flags of Counterfeit Money................................................................................................................. 212
Red Flags of Counterfeit and Forged Documents ................................................................................... 213
Conspiracy to Defraud the Government ......................................................................................................... 213
Basic Elements to Prove Conspiracy to Defraud the Government ...................................................... 214
U.S. Laws Criminalizing Conspiracies to Defraud the Government .................................................... 214
Grant Fraud .......................................................................................................................................................... 215
Video ............................................................................................................................................................... 216
Basic Responsibilities of Grant Recipients ................................................................................................ 216
Common Grant Fraud Schemes ................................................................................................................. 216
Perpetrators of Grant Fraud........................................................................................................................ 217
Common Motivations for Committing Grant Fraud .............................................................................. 218
Red Flags of Grant Fraud ............................................................................................................................ 218
Measures to Prevent Grant Fraud .............................................................................................................. 220
Student Financial Aid Fraud............................................................................................................................... 221
Video ............................................................................................................................................................... 222
Student Financial Aid Fraud Perpetrated by Students............................................................................. 222
Student Financial Aid Fraud Perpetrated by Employees of Educational Institutions ........................ 223
Review Questions ................................................................................................................................................ 225
VIII. MEASURES TO PREVENT GOVERNMENT FRAUD
Introduction .......................................................................................................................................................... 229
Ethical Tone at the Top ...................................................................................................................................... 229
Tone in the Middle ....................................................................................................................................... 230
Minimize Motivations and Pressures to Commit Fraud ................................................................................ 230
Increasing Morale .......................................................................................................................................... 231
Offering Employee Support Programs ...................................................................................................... 232
Promoting and Rewarding Loyalty ............................................................................................................. 233
Establishing an Open-Door Management Policy .................................................................................... 233
Measuring Employee Attitudes About Anti-Fraud Efforts .................................................................... 233
Establishing a System of Disciplinary Procedures ................................................................................... 233
Fraud Policy .......................................................................................................................................................... 234
Video ............................................................................................................................................................... 234
Scope of Policy .............................................................................................................................................. 235
Policy Statement ............................................................................................................................................ 235
Actions Constituting Fraud ......................................................................................................................... 235
Investigation Responsibilities ...................................................................................................................... 235
Confidentiality ............................................................................................................................................... 236
Authorization for Investigation .................................................................................................................. 236
Employee Responsibilities ........................................................................................................................... 236
Reporting Procedures ................................................................................................................................... 236
Acting in Good Faith ................................................................................................................................... 236
Whistleblower Protection ............................................................................................................................ 236
Termination.................................................................................................................................................... 236
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VIII. MEASURES TO PREVENT TO PREVENT GOVERNMENT FRAUD (CONT.)
Administration ............................................................................................................................................... 236
Fraud Risk Assessments...................................................................................................................................... 237
What Factors Influence Fraud Risk? .......................................................................................................... 237
Benefits of a Risk-Based Approach ............................................................................................................ 237
Planning for a Fraud Risk Assessment ...................................................................................................... 238
Video ............................................................................................................................................................... 239
Fraud Risk Assessment Framework ........................................................................................................... 240
Video ............................................................................................................................................................... 242
Video ............................................................................................................................................................... 247
Risk Assessment Checklist ........................................................................................................................... 247
The Fraud Risk Assessment Tool ............................................................................................................... 247
Internal Controls .................................................................................................................................................. 248
Video ............................................................................................................................................................... 248
Video ............................................................................................................................................................... 248
Reporting System ................................................................................................................................................. 249
Video ............................................................................................................................................................... 249
Video ............................................................................................................................................................... 250
Employee Anti-Fraud Education ...................................................................................................................... 250
Video ............................................................................................................................................................... 250
Video ............................................................................................................................................................... 251
Who Should Attend? .................................................................................................................................... 251
Frequency and Length of Fraud Awareness Training ............................................................................. 251
Training Delivery Methods .......................................................................................................................... 251
Video ............................................................................................................................................................... 252
Topics to Cover in Training ........................................................................................................................ 252
Video ............................................................................................................................................................... 253
Video ............................................................................................................................................................... 254
Document Training ...................................................................................................................................... 254
Continuous Monitoring ...................................................................................................................................... 254
Video ............................................................................................................................................................... 254
Video ............................................................................................................................................................... 255
Video ............................................................................................................................................................... 255
Video ............................................................................................................................................................... 255
Employee Background Checks .......................................................................................................................... 256
Video ............................................................................................................................................................... 256
Due Diligence for Third Parties ........................................................................................................................ 258
Mandatory Vacation and Job Rotation Policies .............................................................................................. 258
Video ............................................................................................................................................................... 259
Fraud Prevention in Local Government .......................................................................................................... 259
Video ............................................................................................................................................................... 260
Video ............................................................................................................................................................... 260
Review Questions ................................................................................................................................................ 262
IX. USING DATA TO COMBAT GOVERNMENT FRAUD
Introduction .......................................................................................................................................................... 265
Video ............................................................................................................................................................... 265
Video ............................................................................................................................................................... 265
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IX. USING DATA TO COMBAT GOVERNMENT FRAUD (CONT.)
Video ............................................................................................................................................................... 266
Barriers to Using Data Analytics to Prevent and Detect Fraud .................................................................... 267
Large Volumes of Data ................................................................................................................................ 267
Silo Systems.................................................................................................................................................... 267
Inadequate Data Sharing .............................................................................................................................. 268
Inadequate Access to Data .......................................................................................................................... 268
Poor Data Integrity ....................................................................................................................................... 269
Format Inconsistencies ................................................................................................................................ 269
Limited Analytic Capabilities ....................................................................................................................... 269
Cultural Impediments ................................................................................................................................... 269
Data Analysis Process ......................................................................................................................................... 270
The Planning Phase ...................................................................................................................................... 270
Video ............................................................................................................................................................... 270
The Preparation Phase ................................................................................................................................. 271
The Testing Phase ......................................................................................................................................... 272
Video ............................................................................................................................................................... 272
Spectrum of Analysis Capabilities ..................................................................................................................... 272
Common Data Analysis Techniques................................................................................................................. 273
Aging ............................................................................................................................................................... 273
Compliance Verification .............................................................................................................................. 273
Expressions or Equations ............................................................................................................................ 274
Testing for Frequently Used Values ........................................................................................................... 274
Fuzzy Logic Matching .................................................................................................................................. 274
Gap Tests ....................................................................................................................................................... 274
Identifying Amounts Below a Threshold .................................................................................................. 274
Video ............................................................................................................................................................... 275
Identifying Unusual Dates and Times........................................................................................................ 275
Round-Dollar Payments............................................................................................................................... 275
Benford’s Law................................................................................................................................................ 275
Video ............................................................................................................................................................... 275
Statistical Analysis ......................................................................................................................................... 276
Trend Analysis ............................................................................................................................................... 277
Predictive Modeling ...................................................................................................................................... 277
Qualitative Data Analysis ............................................................................................................................. 277
Video ............................................................................................................................................................... 277
Textual Analytics ........................................................................................................................................... 278
Video ............................................................................................................................................................... 278
Video ............................................................................................................................................................... 279
Conflict Checking ......................................................................................................................................... 279
Transaction Risk Scoring ............................................................................................................................. 279
Scheme-Specific Data Analysis Tests ................................................................................................................ 279
Data Analysis Tests for Billing Schemes ................................................................................................... 280
Data Analysis Tests for Payroll Schemes................................................................................................... 281
Data Analysis Tests for Expense Reimbursement Schemes .................................................................. 281
Data Analysis Tests for Corruption Schemes ........................................................................................... 282
Data Analysis Tests for Inventory Schemes ............................................................................................. 283
Review Questions ................................................................................................................................................ 285
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X. PROTECTING SENSITIVE AND CLASSIFIED DATA
Introduction .......................................................................................................................................................... 287
Video ............................................................................................................................................................... 287
Video ............................................................................................................................................................... 287
Common Threats to Sensitive and Classified Data ........................................................................................ 288
Video ............................................................................................................................................................... 288
Theft and Espionage..................................................................................................................................... 288
Employee Sabotage ....................................................................................................................................... 288
Advanced Persistent Threats ....................................................................................................................... 289
Malware .......................................................................................................................................................... 289
Uneducated Users ......................................................................................................................................... 289
User Errors and Omissions ......................................................................................................................... 289
Social Engineering Threats .......................................................................................................................... 289
Email Security Risks ..................................................................................................................................... 289
Internal Threats ............................................................................................................................................. 289
Malicious Hackers ......................................................................................................................................... 289
Foreign Government Threats ..................................................................................................................... 290
Threats to Personal Privacy ......................................................................................................................... 290
Exploitation of Trusted Relationships ....................................................................................................... 290
Types of At-Risk Information ........................................................................................................................... 290
Proprietary Government Information ....................................................................................................... 290
Government Secrets ..................................................................................................................................... 290
Personally Identifiable Information ........................................................................................................... 291
Business Identifiable Information .............................................................................................................. 292
Private Financial Information ..................................................................................................................... 292
Personal Health Information....................................................................................................................... 292
Sources of Data Leakage..................................................................................................................................... 293
Employee Negligence ................................................................................................................................... 293
Video ............................................................................................................................................................... 293
Loss of Physical Media ................................................................................................................................. 293
Inadequate Business Processes ................................................................................................................... 293
Improper Disposal of Documents and Media .......................................................................................... 294
System Failure ................................................................................................................................................ 294
Malicious Insiders ......................................................................................................................................... 294
Hacker Attacks .............................................................................................................................................. 294
Perpetrators of Information Theft .................................................................................................................... 294
Insiders ........................................................................................................................................................... 295
Hackers ........................................................................................................................................................... 300
Competitors ................................................................................................................................................... 300
Organized Criminal Groups ........................................................................................................................ 300
Government-Sponsored Groups ................................................................................................................ 301
Information Espionage ....................................................................................................................................... 301
Targets of Information Espionage ............................................................................................................. 301
High-Risk Industries ..................................................................................................................................... 302
Forms of Information Espionage............................................................................................................... 303
Video ............................................................................................................................................................... 303
Exfiltration Techniques ................................................................................................................................ 303
Social Engineering ............................................................................................................................................... 304
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X. PROTECTING SENSITIVE AND CLASSIFIED DATA (CONT.)
Video ............................................................................................................................................................... 304
Why Social Engineering Attacks Succeed ................................................................................................. 305
Information Targeted by Social Engineers................................................................................................ 305
How Social Engineering Works .................................................................................................................. 306
Red Flags of In-Person Social Engineering Schemes .............................................................................. 309
Preventing Social Engineering Schemes .................................................................................................... 309
Common Challenges with Protecting Information ........................................................................................ 311
Video ............................................................................................................................................................... 311
Protecting Sensitive and Classified Data .......................................................................................................... 311
Video ............................................................................................................................................................... 312
Security Risk Assessments ........................................................................................................................... 312
Video ............................................................................................................................................................... 312
Security Policies and Procedures ................................................................................................................ 313
Awareness Training ...................................................................................................................................... 313
Nondisclosure Agreements.......................................................................................................................... 314
Data Retention and Destruction Policies .................................................................................................. 314
Security Controls ........................................................................................................................................... 315
Incident Response Plan ................................................................................................................................ 316
Video ............................................................................................................................................................... 316
Information Security in Bring-Your-Own-Device Environments ............................................................... 316
BYOD Challenges and Risks ...................................................................................................................... 316
Video ............................................................................................................................................................... 317
Video ............................................................................................................................................................... 317
BYOD Policies .............................................................................................................................................. 321
Mobile-Device Management Platforms ..................................................................................................... 326
Video ............................................................................................................................................................... 326
Cloud Computing and Information Security ................................................................................................... 328
Video ............................................................................................................................................................... 328
Video ............................................................................................................................................................... 328
Cloud-Computing Security Challenges ...................................................................................................... 328
Video ............................................................................................................................................................... 329
Protecting Data in the Cloud ...................................................................................................................... 329
Challenges of Investigating in the Cloud ................................................................................................... 331
Review Questions ................................................................................................................................................ 333
XI. INVESTIGATING GOVERNMENT FRAUD
Introduction .......................................................................................................................................................... 337
Government Fraud Investigations Versus Private Fraud Investigations .................................................... 337
Video ............................................................................................................................................................... 338
Individual Rights and Protections ..................................................................................................................... 339
Rights and Obligations Under Criminal Law ............................................................................................ 340
Government Search and Seizure................................................................................................................. 340
Privacy Laws .................................................................................................................................................. 341
Protections Against Unlawful Confinement ............................................................................................. 343
Video ............................................................................................................................................................... 344
Video ............................................................................................................................................................... 345
Protections Against Harms to Reputations ............................................................................................... 345
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XI. INVESTIGATING GOVERNMENT FRAUD (CONT.)
What Fraud Examination Entails ...................................................................................................................... 346
Obtaining Evidence ...................................................................................................................................... 346
Reporting ........................................................................................................................................................ 346
Testifying to Findings ................................................................................................................................... 347
Assisting in the Detection and Prevention of Fraud ............................................................................... 347
Fraud Examination Methodology ..................................................................................................................... 347
Assume Litigation Will Follow .................................................................................................................... 347
Act on Predication ........................................................................................................................................ 347
Video ............................................................................................................................................................... 348
Move from the General to the Specific ..................................................................................................... 348
Use the Fraud Theory Approach ................................................................................................................ 348
Video ............................................................................................................................................................... 349
Develop a Fraud Response Plan ........................................................................................................................ 349
The Response Team ..................................................................................................................................... 350
Factors Used to Decide on the Course of Action.................................................................................... 350
Litigation Hold Procedures ......................................................................................................................... 351
Principles for Documenting the Response ............................................................................................... 351
Incident Report Log ..................................................................................................................................... 351
Typical Steps in a Fraud Investigation .............................................................................................................. 352
Conduct an Initial Response ....................................................................................................................... 352
Assemble the Fraud Team ........................................................................................................................... 354
Video ............................................................................................................................................................... 354
Develop an Investigation Plan .................................................................................................................... 355
Video ............................................................................................................................................................... 356
Video ............................................................................................................................................................... 356
Video ............................................................................................................................................................... 357
Video ............................................................................................................................................................... 358
Conduct the Investigation............................................................................................................................ 360
Report the Findings ...................................................................................................................................... 363
Written Versus Oral Reports ....................................................................................................................... 363
Respond to the Findings .............................................................................................................................. 365
Review Questions ................................................................................................................................................ 368
XII. INVESTIGATING WITH THE INTERNET
Introduction .......................................................................................................................................................... 371
Video ............................................................................................................................................................... 371
Five-Step Approach to Using the Internet in Fraud Examinations ............................................................. 371
Using Internet Search Engines to Find Information ...................................................................................... 372
Search Engines .............................................................................................................................................. 372
Meta-Search Engines .................................................................................................................................... 372
Advanced-Search Operators........................................................................................................................ 372
People Search Engines ................................................................................................................................. 375
Foreign Search Engines................................................................................................................................ 376
Additional Tips When Using Internet Search Engines to Find Information ...................................... 376
Using Online Databases to Find Public Records ............................................................................................ 377
Online Sources of Public Records .............................................................................................................. 377
Limitations of Online Public Database Searches ..................................................................................... 379
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XII. INVESTIGATING WITH THE INTERNET (CONT.)
Using the Deep Web to Find Information ...................................................................................................... 380
Using Internet Archives to Find Information ................................................................................................. 381
Using Social Networking Sites to Find Information ...................................................................................... 382
Video ............................................................................................................................................................... 382
Video ............................................................................................................................................................... 383
Types of Social Media................................................................................................................................... 383
Popular Social Media Platforms .................................................................................................................. 384
Social Media Search Tools ........................................................................................................................... 386
Privacy Issues When Collecting Evidence from Social Media ............................................................... 387
Using Newspaper and Media Databases to Find Information Online ........................................................ 388
Factiva ............................................................................................................................................................. 389
LexisNexis ...................................................................................................................................................... 389
HighBeam Research...................................................................................................................................... 389
ProQuest ........................................................................................................................................................ 389
Using the WHOIS Protocol to Find Information .......................................................................................... 389
Pitfalls of Using the Internet for Investigative Purposes ............................................................................... 390
Review Questions ................................................................................................................................................ 392
XIII. APPENDIX: VIDEO TRANSCRIPTS ........................................................................................... 395
XIV. SOLUTIONS TO REVIEW QUESTIONS
II. Occupational Fraud by Government Employees ................................................................................. 435
III. Public Corruption ...................................................................................................................................... 443
IV. Procurement Fraud.................................................................................................................................... 448
V. Fraudulent False Claims and Statements ................................................................................................ 453
VI. Introduction to Fraud in Government Social Programs ..................................................................... 457
VII. Other Types of Government Fraud ........................................................................................................ 463
VIII. Measures to Prevent Government Fraud ............................................................................................... 470
IX. Using Data to Combat Government Fraud .......................................................................................... 475
X. Protecting Sensitive and Classified Data ................................................................................................ 479
XI. Investigating Government Fraud ............................................................................................................ 484
XII. Investigating with the Internet ................................................................................................................ 490
FINAL EXAMINATION .............................................................................................................................. E-1
INDEX ................................................................................................................................................................... I-1
Fighting Fraud in the Government
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