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Article: Focus on fraud: internal controls, audit policies--and a tough stance--can help deter fraud.(FRAUD PREVENTION)
- Article from:
- California CPA
- Article date:
- September 1, 2005
- Author:
CopyrightCOPYRIGHT 2005 California Society of Certified Public Accountants. This material is published under license from the publisher through the Gale Group, Farmington Hills, Michigan. All inquiries regarding rights should be directed to the Gale Group. (Hide copyright information)
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Consumer fraud in California amounted to $53 million in 2004, according to the Federal Trade Commission. To stop fraud in its tracks, it's necessary to understand the four general elements that must occur to establish fraud:
* A misrepresentation of material facts;
* Knowledge of the falsity of the representations made with the intent to deceive;
* Reliance by the victim upon the misrepresented facts; and
* Actual injury resulting from the misrepresentation.
Typically, fraud occurs in the shadows. While a bank robber steals with a gun in front of employees and customers, the person who steals by committing fraud generally goes ...