Course Introduction
Course Content

Corporate Fraud

Internal corporate fraud is an ever-growing problem. Government prosecutors bring charges against thousands of people every month for white collar crimes. Those charges leave businesses vulnerable to ongoing problems, including massive legal fees, large fines, and potentially, criminal liabilities.

Management leaders may not have a clear process on how to prevent fraud, or how to respond if they uncover a fraud. We offer this introductory compliance course to assist companies with the following objectives:

  • Help all team members understand the implications of a government investigation,
  • Identify best practices within corporate operations, and encourage employee compliance,
  • Improve messaging and corporate storytelling,
  • Minimize risk to litigation,
  • Teach businesses how to develop a best-practice approach to respond to a government investigation, and
  • Develop a mitigation strategy in the event of a government investigation.

We encourage company leaders to use the modules our team at Compliance Mitigation creates to help all people on the team understand the costs and collateral consequences of a government investigation. Strength comes through proper preparation.

Members of our team have worked with numerous entrepreneurs that didn’t know their business practices violated regulations, or how their policies could expose them to the enormous costs of litigation or a government investigation.

For example, a small business that advertised debt-relief services accepted advance payments from consumers. The business owner hired scores of telemarketers that sold the service. By accepting advance payments from consumers, the business leaders and decisions makers made themselves vulnerable to government investigations. They weren’t aware of the Federal Trade Commission’s prohibitions against collecting advance fees. 

Nor did they understand how a government investigation could lead to:

  • litigation,
  • an asset freeze, and
  • forfeitures that would cripple their business.

Good compliance training helps leaders make better decisions. By investing time to both learn and teach, leaders can create a culture that minimizes exposure to risks in an era of big government.

Larger companies have different complications. People become complacent, expecting that they’re operating without risk to regulation or interference from government. Sadly, many rank-and-file employees get dragged into investigations. Their responses to the investigations can bring them into further problems.

Our nation’s prison system confines thousands of people that once worked in large companies. Prosecutors convicted those people of white-collar crimes, even though the people professed to be doing their jobs without any knowledge that they were breaking laws.

Although people may begin working in a company with the best of intentions, something can happen during the course of a person’s career to throw them off track. Thinking that they could get away with certain actions, some people engage in behavior without fully understanding the consequences. For example, consider the case of David Smith, who faced charges for crimes he committed while on the job as a manager at Quest Diagnostics.

David faced personal financial problems and, as a result, concocted a complex reimbursement scheme, creating systems that would lead his employer to reimburse him for fraudulent expenses. Smith created fake companies, invoices, and expense reports for payments he’d supposedly made on Quest’s behalf. An internal investigation revealed that Smith had forged his boss’s signature. The internal investigation uncovered losses totaling more than $1.2 million. Quest referred the case to the FBI. A judge sentenced Smith to five years in prison. Beside the financial loss and Smith’s criminal liability, the distraction undermined confidence in Quest Diagnostic’s management team.

Better compliance training serves companies and individuals by:

  • Broadening an awareness of the consequences that follow white collar crime,
  • Helping people think before they compromise their values, and
  • Providing transparency into businesses processes, potentially lessening occurrences of internal corporate fraud.