Who’s Involved in Supply Chain Fraud?


Fraud, especially those related to the supply chain, will encompass internal, external, and mixed (internal and external) types of collusion scenarios. In brief:

Internal fraud will be perpetrated solely within the organization, without the known involvement of an outside entity, such as a customer or supplier. This may involve an individual or several people on the inside collaborating together to perpetrate the fraud.

External fraud will be perpetrated by an external entity, such as a customer or a supplier, with no knowledgeable or willing person inside the organization as an accomplice.

Mixed frauds will involve collusion between an external entity (i.e. customer, supplier) and one or more internal persons (i.e. full-time employee, contract employee, consultant, etc.).

• Engaged employees (29%) are innovators and drive organizations forward.

• Not Engaged employees (56%) “do their time” during the workday, but are also water-cooler chatters and Internet-surfers for a significant amount of the workday.

• Actively Disengaged employees (15%) are those who purposefully and intentionally thwart and subvert the progressive activities of the organization and other employees.

Other articles in this series:

An Introduction to Supply Chain Fraud

Supply Chain Fraud and Sarbanes-Oxley

COSO – Sarbanes-Oxley and Supply Chain Fraud

Definition of Supply Chain

Definition of Fraud

What Are the Causes of Supply Chain Fraud?

Where Does Supply Chain Fraud Happen?

Assessing the Impacts of Supply Chain Fraud

Methods of Detecting Supply Chain Fraud

Dreaded Shrinkage: Bottomless Pit or Grave?

Importance of Internal Assessments Before SOX Audits

Budgeting For the Repercussions of Supply Chain Fraud

Summarizing Challenges Surrounding Supply Chain Fraud

Guest Author: Norman Katz

Copyright © Katzscan, Inc. – Source: Supply Chain Fraud White Paper

Telephone: 954-942-4141  www.katzscan.com  Since January 1996  www.supplychainfraud.com

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