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Fraud News and How to Prevent It

An Accounts Payable Manager at Carolina Steel Group, Angela Womack, has been convicted of multiple counts of wire fraud and money laundering.  Womack managed to create non-profit accounts named "IBOCF."  She made the checks payable to "International IBOCF" which were included on the company's vendor reports, even though it was not one of Carolina Steel Group's vendors. She altered internal accounting data and made the checks to appear to be paid to legitimate vendors.

Womack was sentenced to 70 months in prison along with three years of supervised release.  Womack is ordered to pay restitution of $2,857,201.85 and a special assessment of $300.00.  Read the full news article here.

Make sure your organization has strong internal controls in place. Here are a few tips on how to prevent fraud:

  1. Integrate the appropriate segregation of duties (one person per leg).
  2. Run frequent reports showing who has access to what. Be sure to take into consideration promotions and employees who left the company.
  3. Create a written, detailed expence policy for your organization.
  4. Compile daily bank reconciliations and check for unauthorized transactions.
  5. Automate your accounts payable process which will allow you to have an audit trail and set approval routes. It greatly reduces your risk of fraud when you know who did what when.

Check out our on-demand webinar on internal controls here.


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