The Threat of Fraud
American InterContinental University
Security and Loss Prevention
March 28, 2013
Identity theft, whether on a personal or business level is a criminal act. So, for many years individuals have plotted and schemed to come up with scams to obtain personal information from other individuals or organization to either sabotage one’s reputation or obtain financial gain. Either way, this wave of criminal activity is wreaking havoc to innocent people and successful organizations everywhere.
The Threat of Fraud
Corporate fraud and executive identity theft are crimes that are on the rise. I don’t ...view middle of the document...
There are many different examples of fraud like embezzlement, management fraud, investment scams, customer fraud and a few more. Corporations can use fraud to persuade consumers into investing money into a product or the company. When you are looking for employment in the newspaper or online, you may read an advertisement for “Earn money at home”. This scam, is when an entity may promise high profits for part-time earnings that can be made by making or selling a product from your home, in return you may be asked to purchase a starter kit, or instruction on how the plan may work before you can get begin the process ("Hesch and Associates," 2007). Another example of fraud in business is an executive setting up “ghost employees”, falsifying timesheets and receiving the paycheck for that ghost employee ("ACFE," n.d.).
Identity Theft in Business
What is identity theft? According to the World English Dictionary, identity theft is when someone takes on the identity of another individual by use of their personal data or documents to access money or establishes credit without that individual’s knowledge ("Dictionary.com Unbridged," 2013). However, corporate identity theft is the criminal act of stealing the company’s name, altering registration history and establishing credit with that name for the use of purchasing items that may be bought or exchanged for cash. This type of identity theft can have a domino effect and break down an entire corporation, as well as, any financial institutions and retailers that engage in any business transaction with this entity. It can result in the destruction of the company’s reputation, their future credit relationship with banks and retailers, operational problems, employees and even the consumers, not to mention the amount of money and the time it could take to fix the damages (Kemp, 2010). In 2008, close to 2,000 corporate executives were targeted in a email scheme that listed the names of executives, their phone numbers and their company name stating they were being subpoenaed to court for some sort of legal violations against their company. The email required the recipient to click the link to install an add-on in order to view the subpoena. By agreeing to the add-on allowed access of software that could steal usernames and passwords when online banking and other programs that required executive credentials were visited (Richardson, 2008). Enron’s accounting scheme and Madoff/Ponzi investment schemes are just a few of the financial scandals that have affected corporate executives.
Preventing Fraud and Identity Theft
There are organizations that will provide step-by-step advice on how to protect your identity, financial data, your computer, your business and how to recover from the crime, such as Identity Theft: Prevention and Survival (Frank, 2010), Get Safe Online (getsafeonline.com) and The Institute for Information Infrastructure Protection (I3P) (I3P, n.d.). These are just three of many organizations...