Forensic Accounting Essay
As a result of recent, highly publicized financial scandals; reported increases in occupational fraud; and heightened concerns over money laundering to support terrorism and racketeering, legislative mandates and public expectations have heightened the necessity to hrther define the auditor's and accountant's responsibility for detecting fraud within organizations. Successful fraud or forensic accounting analyses and findings reported by practicing professionals may be the difference between whether perpetrators avoid detection of their illegal activities or they are brought to justice. In most cases, success is directly and primarily dependent upon the knowledge, skills, …show more content…
What is Financial Fraud?
Financial fraud can be broadly defined as an intentional act of deception involving financial transactions for purpose of personal gain. Fraud is a crime, and is also a civil law violation. Many fraud cases involve complicated financial transactions conducted by 'white collar criminals' such as business professionals with specialized knowledge and criminal intent.
An unscrupulous investment broker may present clients with an opportunity to purchase shares in precious metal repositories, for example. His status as a professional investor gives him credibility, which can lead to justified credibility among potential clients. Those who believe the opportunity to be legitimate contribute substantial amounts of cash and receive authentic-looking bond documentation in return. If the investment broker is fully aware that no such repositories exist and still receives payments for worthless bonds, then victims may sue him for fraud.
Fraudsters can contact their potential victims through many methods, which include face- to-face interaction, by post, phone