Corporate fraud cases are often complex and can occur in a number of ways. In some instances of corporate fraud, the company is a victim of external fraud while in other situations it’s someone in the company who is the perpetrator. Sometimes leaders of the company are fully aware and involved and sometimes they are oblivious to the crime if members of staff are secretly committing fraudulent activity. Whatever the situation, our fraud barristers are highly experienced in defence and prosecution of corporate fraud cases. Let’s take a look at five of the most common corporate fraud cases in further depth.
Types of Corporate Fraud Cases
There are a number of ways identity fraud is committed, but the two main methods are:
- Company hijacking
The hacker begins by stealing information about the company such as name, address and company registration number – sometimes this information is found on lost payslips. These details may then be used to make purchases on the company’s credit, make VAT claims, or facilitate criminal activity such as money laundering or illegal financial activity.
Fraudsters might also contact a company’s clients, in the guise of a trusted company, to defraud them.
Sometimes corporate identity fraud is committed from the inside by employees who have themselves been defrauded or have colluded to steal company information, leaking it to criminals or misusing the information themselves. It is also common for corporate identity fraud to have been committed by external parties who have targeted specific companies.
Payroll fraud typically works on the premise of an employee submitting a false timesheet and receiving payment for time they haven’t actually worked. They either do this by submitting incorrect numbers or by asking an employee to clock in for them when they aren’t present. This can go unnoticed if a supervisor hasn’t checked or approved the timesheets carefully before they are sent away for payment and can lead to the business paying for resources it didn’t receive, thus making a loss while someone makes an unlawful gain.
This type of fraud is generally committed by an employee within a corporation who doctors figures to make the business seem more appealing to current or potential investors. The corporation falsifies financial statements by overstating revenue or assets while understating expenses and liabilities to manipulate profit reports and mislead shareholders and investors. This way, a company could be running at a loss while increasing its share price and receiving continuous investment without an ability to repay investors.
Payment fraud is a term that applies to false or illegal payments and covers a number of methods. For example, this can happen internally if an employee of a company was siphoning business funds to their own personal account However, payment fraud can also take place externally through cyber-attack, lost or stolen merchandise, false refund requests or bounced cheques.
Invoice fraud can be difficult to spot until it is too late. A fraudster poses as a known supplier and asks the victim company to change the bank account details associated with that supplier. Because the impersonation can be so seamless, the company then changes the bank details on file for that supplier and makes out future payments to the fraudster instead of the supplier.
What to do if You’ve Been Involved in Corporate Fraud Cases
If you have intentionally or unintentionally become involved in a corporate fraud case or are being accused of committing corporate fraud, it’s important to seek legal representation as early as possible in the proceedings. Our team of experienced fraud lawyers are highly regarded in the legal sector and are here to help. Contact us today to discuss your case.