Reflection Before and After Boot Camp Business Fraud
Reflection Before and After Boot Camp: Business Fraud
Business fraud is one of the most common issues that many business globally face while undertaking their day to day operations. As a result, many individuals have knowledge of what business fraud is, have experienced it, or know a person who has gone through it. I have read about issues classified as fraud on the internet, on the news, and even in class. However, despite the facts that a vast majority of individuals have a rough idea what business fraud is, it is imperative to note that there is more to business fraud that meets the eye.
I always thought business fraud to be a simple concept that involves illegal and dishonest activities that are conducted by different individuals within the organizations in order to gain advantageous financial outcomes for themselves or the establishment. Actually, I thought business fraud as a sought of corrupt ring of individuals working for big corporates in an attempt to make it big. I always thought of business fraud as a factor that only affects large organizations and their financials, but in fact this is not always the case. Before the boot camp, I had not given the issue much thought beyond the stereotypical definition of it.
After attending the boot camp, I think I now understand business fraud to be a deep concept embedded in ethics, organizational culture, and the business environment at large. In regard to the business environment, fraudulent activities not only affect the financial status of individuals and the company but also its reputation. At boot camp, I learned about Enron, the Volkswagen emissions saga, the Wells Fargo fake accounts fraud scandal, Capital One credit card compromise, Huawei’s involvement with data theft, and the Lehman Brothers deals that facilitated the 2008-2009 global financial crisis. When different individuals engage in business fraud for the purpose of financial gain, for instance, in financial institutions, this greatly affects the reputation of the company due to the fact that, individuals will not be willing to acquire services from a company involving itself with illegal and dishonest activities (Hassink et al., 2009). The learning experience gave a new meaning to fraudulent business activities to include all illegal activities at every level of an organization undertaken in a manner regarded as unethical and dishonest designed to gain an advantage or any other gains.
At boot camp, I was introduced to the issue of ethics and how it defines relations in business. I was able to understand that business fraud is considered one of the most prominent corporate ethical issues that affect numerous organizations. By engaging in fraudulent business activities, many organizations put themselves in a situation of moral conflict that in one way or another results to their moral standards being question. By engaging business fraud, organizations go against their morals of conducts and as a result causing doubt in eyes of the general public.
Looking back from my prior knowledge before boot camp, I now understand business fraud to have far-reaching consequences. Business fraud takes place in the organization in various forms. For example, for a majority of organizations fraud occurs in the financial system through the pay roll system. I was able to understand that employees within the organization could lie about their productivity in different operations, sale hours worked with an aim to get a higher pay at the end of their shifts. In other areas, these employees may also request to be paid in advance without any intent of paying back the money or doing the job awarded. In this case, payroll fraud affects many businesses especially small scale businesses due to the fact that they do not have anti-fraud systems and measures such as insurance.
Apart from manifesting itself as payroll fraud, I also came to understand that business fraud within an organization can also manifest itself as asset misappropriation commonly known as skimming. I was able to learn that, asset misappropriation is considered one of the most common form of business fraud that affect business organizations in terms of organizational success and reputation (Jackson et al., 2010). In addition, I also learn that this form of fraud is also considered the easiest to identify within a business. Based on this, I understood that the best and most appropriate ways of identifying this type of fraud is by watching out for missing inventory, forged checks, and missing accounts which do not add up in the company’s account books. In addition, I also realized any individuals could be a victim to skimming, which in simple terms involves the act of taking finances from a company or a client without recording these transactions in company’s books as per the regulations.
Beyond misappropriation and skimming, I was also able to understand that invoice fraud scheme is another major form of business fraud that happens within many business organizations on a daily basis. Through much research studies in boot camp, I learnt that, this form of fraud occurs when organizational employees during sales operations often create invoices which in the eyes of the company are considered fake with an aim of stealing fiancés from the organization. By engaging in this fraud, it simply means that fake invoices on services and products which are written as brought, indeed is not true. By creating fake suppliers and supplies, I was able to understand that in this case, organization employees are engaging in business fraud activities which in the long run affect the profits, success and the reputations of the organization.
There are many other forms of fraud occurring in the business world. Besides invoice fraud schemes, tax fraud is another major business fraud that I learnt organizations and its employees engage in. while many individual only know this form of business fraud as tax fraud, I was able to understand that tax fraud is indeed a common form of business fraud that we encounter on a daily basis as it involves tax evasion. It occurs when organizational employees fail to report their expenses and earnings to relevant authorities such as the IRS which tackles issues regard taxes. Bearing in mind that this form of business fraud exists in every sector of business, I was therefore able to understand that business fraud is in indeed embedded within the business environment.
Finally, I can say that I have gained a lot of insight in relation to fraud in business. I have gained a new realization that business fraud is indeed a common concept that is embedded within every business organization. I also know that it can be disseminated by anyone at any given level in an organization. The case examples show that fraud may originate from a simple idea to gain a market advantage such as the Wells Fargo case or through a greedy venture to take on an entire industry as the Lehman Brothers did brining about a global impact. In other cases, it is just a case of covering up for a mistake like Volkswagen’s decision to cover up the real emissions numbers for their diesel cars. In addition I was also able to understand that business fraud manifests itself in various ways, for instance, as payroll fraud, misappropriation of funds, and invoice fraud scheme.
References
Hassink, H. F., Bollen, L. H., Meuwissen, R. H., & de Vries, M. J. (2009). Corporate fraud and
the audit expectations gap: A study among business managers. Journal of international accounting, auditing and taxation, 18(2), 85-100.Jackson, K., Holland, D. V., Albrecht, C., & Woolstenhulme, D. R. (2010). Fraud isn’t just for
big business: Understanding the drivers, consequences, and prevention of fraud in small business. Journal of International Management Studies, 5(1), 160-164.
