Case 3 Payroll Fraud

1.The tone at the top is how the upper managements commitment and leadership is towards honesty, integrity and ethical behavior. I feel the tone at the top is important in deterring expense account fraud. In any organization it’s important to have control over your environment and set the tone for others. If you want a place where you implement integrity you have to give integrity. If the tone upholds ethics, honesty and integrity then the employees will carry theses same core values. However, if upper management is committing fraud it will so employees that it is ok to do unethical practices as well. Management has to be a leader for their organization and create a mission and a vision, without that there is no foundation.

2.Some common types of expense account fraud employees commit are payroll fraud, using business money for your personal expenses and

I believe that they might not believe that they’re doing anything wrong when it comes to payroll fraud because they will believe that upper management doesn’t look at what they’re doing because they trust them. Also, the will believe that since they have been doing payroll fraud for so long that no one would notice if they haven’t caught them yet, so they will continue to do it. Pocketing/spending money for personal use is another expense fraud employees’ commit because they have easy access to the money and spend how much they want. I feel that in this case an individual will do it a couple of times to see if they get caught, if not, the get swipe happy and buy what they want. They don’t feel as if this as bad as other organizational fraud because it’s only small amounts at a time not realizing after a while it adds up