Nathan Mueller's Employer, Reliastar Fraud

explanatory Essay
1281 words
1281 words

Nathan Mueller’s employer, ReliaStar was acquired by the large insurance company ING in 2000. Mueller had a deep understanding of accounting systems and was in charge of transitioning his old employer to the new ERP system. Mueller learned “all aspects of the ERP system including financial reporting, journal entries, and most importantly, checks and wire payment processing” (“Lessons Learned,” 2014). Mueller was an accounting manager of the reinsurance division at one of ING’s offices. He stole almost $8.5 million in a little over four years. Mueller’s department at ING was the reinsurance division, which gave him the ability to approve company checks of up to $250,000. He embezzled this significant amount of money from his employer by requesting …show more content…

He created a dummy company so he could write checks out to that company and use the stolen money for his own purposes. Mueller did not have to create a client name in ING’s accounting system because ING already did a lot of business with a company with “Ace” in its name. Using this system, Mueller embezzled about $8 million in a four-year period. The fraud was concealed by hiding the debits in an expense-type ledger account with lots of reconciliation activity. Furthermore, Mueller was undervaluing the Canadian dollar when recording ING investment income from Canadian investments. Segregation of duties was severely lacking because Mueller was the only one reconciling this account for seven years. According to the article, ING’s accounting system had “thousands of journal entries and billions of dollars of transactions” (“Lesson’s Learned,” …show more content…

For good behavior and completing a drug abuse for alcohol, he is due released only after about five and a half years in prison. A lot of systems were missing or manipulated to commit the fraud. ING top management should be aware that Mueller knows all the inner workings of his division’s ERP system and that the opportunity for fraud is stronger. He also had full authority to request and approve checks, while simultaneously writing associated journal entries to conceal the embezzlement. Segregating the operational duties from the recordkeeping responsibilities is a way that could have prevented this fraud. Authentication controls put in place to restrict access to other employer’s computers would have prevented Mueller from impersonating the subordinate or coworker. A lower limit should have also been placed on Mueller’s approval authority of

In this essay, the author

  • Explains that nathan mueller's employer, reliastar, was acquired by the large insurance company ing in 2000. mueller learned all aspects of the erp system including financial reporting, journal entries, and checks and wire payment processing.
  • Explains that mueller worked in the accounting department of his division, where he was one of three employees that could request checks. he could log-in as another employee and request a check, while approving it using his own account.
  • Describes how mueller wrote a check on behalf of his company to pay off $88,000 of credit card debt. the checks went undetected because one of ing’s customers had “universal” as part of its name.
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