Fraud Smart Risk Management

We are coming towards the end of this book and there is a need to pull everything together in this slightly longer chapter, where we examine the overarching concept of fraud risk management.

As you are aware, this book is based around the Fraud Smart cycle, which covers five key aspects of helping non-specialists get to grips with fraud at work. This is repeated in Figure 19.1.

Figure 19.1 The Fraud Smart cycle.


This chapter sits within the fifth part of the Fraud Smart cycle, Mastering Suitable Controls, and covers the way in which the typical business risk management used by most organizations can incorporate fraud risks to provide a comprehensive framework for dealing with fraud.


The growing threat of fraud is often overlooked in many organizations and this is not helped by the fact that some managers may not buy into the view that they are responsible for managing this threat. What is needed is a way of integrating fraud risk into and inside the more usual business risks with which most managers are used to dealing. If we fail to get this integration, much could go wrong.

We can consider how problems can arise by looking at two brief illustrative case studies taken from the UK and the USA, the first at a supermarket:


A former IT manager at a large supermarket was given a 20-month jail term after stealing over £81 000 ...

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