FraudJournal Blog

October 10, 2011

Calling All Detectives…Elder Exploitation Really is a Crime


First, I want it on the record that this posting is about one or two individuals who felt elder exploitation was not a crime, but rather a family matter. Whether or not they thought about their response in detail it still makes one wonder just the same; what are you thinking?

I have been assisting from time to time on a particular elder financial exploitation case, where the children are exploiting their mother. And here is the kicker. We are having trouble getting the detective to accept the case because this is a family matter and law enforcement are about catching and putting the bad guys in jail; not resolving family matters. This individual was sure elder exploitation was a crime to prosecute. The prosecuting attorney who is willing to take the case, can only wait until a detective processes the case and forwards the case for prosecution. And now once again, another elder exploitation case is pending. Pending a detective to accept the case and apply the necessary due diligence to present the case to the prosecuting attorney.

Now in defense of law enforcement, their fraud case backlog is huge. And I really do mean its a big problem. The people needed to process the cases, with the right skill sets, are few and far between. Funding is next to nothing, all cases are prioritized for the level of community threat, and frankly, elder exploitation is not sexy. Unless there appears to be a possible hastened death situation, their priority is child abuse, murder, rape and the war-on-drugs.

Having said this, let me explain some items that you might not know. First, before any case can get to court, it must first receive a case number from the police department that has jurisdiction in the case. This how it gets tracked, noted, filed and if necessary transferred to the proper jurisdictions. No case number, no detective to process, no litigation.  But I digress, the issue is that the detective felt there isn’t  new laws that make it a crime to exploit an elderly person. It was a family matter to be litigated privately. This individual was also surprised to find out that in WA, there recent changes to state law which gives law enforcement and attorneys the ability to better prosecute for elder exploitation and abuse. This means even if there is not, law enforcement are now able to check in on a vulnerable adult and if necessary, take steps to insure their safety from potential harm whether financial or physical.

The recent set of economic setbacks to all local, county and state agencies has greatly reduced the number of qualified staff able to work the high case load. I understand why the fraud case loads are continuing to back up and that they are as frustrated as the rest of us that there is not enough time in a day to process these cases. I and my fellow fraud fighters understand that public servants need to keep the rapists, murderers and drugs off the streets, but I am concerned that I continue to hear from my colleagues this type of response from veteran detectives/law enforcement officers. Really? This is really how you feel?

I am willing to consider that these few individuals were not thinking clearly; that maybe that cup of coffee was not fully loaded with enough caffeine to engage critical thinking. But this response tends to come from older and more experienced law enforcement personnel, and this concerns me. Why? Because they the men and women that the younger professionals are watching and learning from as they strive for excellence to become viable law enforcement professionals.

As the “Boomer” generation continues to age, their level of vulnerability is going to grow exponentially. This means that they are prey for healthcare fraud, ID theft and of course, abuse and exploitation from friends and family.And they are going to need all of our help.

So my challenge to all of you who continue in the fight against fraud and abuse… please help our law enforcement officers & detectives to believe that elder abuse and exploitation is really a crime worth punishing. That the next vulnerable adult they investigate may be the relative of a friend or neighbor; that they just  might save someone from loosing their home and quite possibly their life.

Thank you for listening.

August 22, 2011

Is Ethics Hard-wired or Learned


I was reading a posting in LinkedIn by Fernando A., in the ACFE group, titled “Pants on Fire! Children and Lying“. The link led to a site called delanceyplace.com 8/18/11 – children and lying. The article a study into the frequency of children telling lies and whether this was indicative of a future problem. It seems that children who lie well are cognitively more advanced and are able to hide their tracks better. They tend to grow up and be more capable of dealing with complex situations, such as employment that requires quick problem solving or outside of the box thinking. The article suggested they might become bankers; I wondered about other financial positions that have recently been in the headlines for manipulation of funds and factual information.Then I thought about the recent trends in education for forensic accounting and fraud investigation. And what about learning to understand the federal tax code and recent gloable accounting issues.

Today’s generation is faced with making choices for more than which college to attend or job for a career. They have become a self-monitored social network of information and ideas. They want their lives to have impact, their efforts to matter, and their path to move at the rate that technology limits them. And I ask myself, what were they like as children? How did they interpret whether to help each other to obtain the advancement they rationalized as necessary to reach either their own goals or their family’s goals. I mention family because so many children now have been pushed through the process of high grades for college and then a better future. Does all of this push to succeed on a fast track impact their view of ethical standards?

Last week I was talking with a college professor who teaches at North Seattle Community College. They have created a new Certificate of Fraud to help students prepare for a career in fraud fighting. One of the topics discussed was about how students’ views of ethical behavior is changing nationwide. Does this generation of students feel differently about sharing information and taking risks that a previous generation might see more black and white. And if so, will that impact how they investigate fraud?

I don’t have an answer, but it poses the question of whether the “perceived need” to commit a fraudulent act will need to be redefined into less black and white and into more levels of grey. I hope not, but as those of us currently in the trenches age, and others come into the roles of leadership, what do they interpret ethical behavior to mean.

So now I am back to whether or not ethics is hard-wired or learned at an early age and how does that affect the fight against fraud. Employers are already being challenged by young professionals on what they expect as employees. Perhaps this generation of young professionals will need to show the veteran fraud fighters what they see as the solutions to a potential fraud wave looming in the future. Elder abuse and exploitation, cyber crime, and white-collar crimes will continue to rise as there is a shift in which population is taking the lead.

My vote is on this upcoming generation of professionals to take everything to the next level with technology and all its trappings. And I still ask, what were they like as children? Were they good liars too?

August 8, 2011

Restaruant Breach Leads to Fraud Article


First, thank you to all who inquired to why my lack of posts; we had a death in the family that required my attention.

THIRD PARTY SECURITY RISKSWhy Compliance is Key for Everyone

Those of you who deal with fraud in the retail and restaurant industry are very familiar with skimmers; for those who don’t, we are talking about the hand-held devices that skim the financial information from your credit cards. These little devices are the bane of fraud fighters around the world. And they are getting smaller and more invasive every day. But the recent problem to hit the fraud newsletters and blogs (see article: Restaurant Breach Leads to Fraud by Tracy Kitten, Managing Editor at Bank Information Security), is the breach at a Texas restaurant from a hacker that gained access to the third-party vendor who processes their credit card transactions.

Restaurants have worked hard to make sure their customers’ credit/debit card information is safely handled, that their employees are following the rules, and all the while attempting to keep up to date on technology. However, the costs to upgrade each time a new software comes out or piece of equipment is available, makes a small business wince. And by nature, restaurants are just plain vulnerable to fraud due to the high level of transactions and tendency for high employee turn-over.

But the recent talk of the town is the breach in Texas; not by skimmer, but a third-party vendor that handles the point-of-sale (POS) system information for the restaurant. The Sheriff’s department are reviewing the details with the Secret Service, but they have come to the conclusion that back in early April and mid-May, the electronic information was intercepted by the hacker who had infected with POS system with a virus to steal payment card transaction data. By July, fraudulent charges began appearing. The most recent restaurants hit in the Walker County, have been “fast-casual diners and pizzerias”.

Mr. Neal O’Farrell, founder of the Identity Theft Council stated that “small businesses are often as much the victim of the breach as their customers are”.  As more and more security breaches become types of cyber attacks, small businesses need to start taking a look at their vendors and asking the hard question of “what are they doing to reduce fraud risk” and “how can we collectively reduce the risk”. Merchants that provide the readers might help by offering better trade-in offsets to reduce costs and promote use of the newer equipment and software available. I can’t remember when it was, but I remember I was shocked to find a business that still had a merchant device that printed out the entire credit card number on my receipt.

As the economy gets tighter and continues to stretch our budgets, fraudsters are going to find the chinks in our armor as we become tired a lacx in our effort to be careful; we need to be diligent about consistently finding ways to reduce the risks of fraud. We have to find new ways to help each other out and not rely on the credit card companies to solve the problem. It’s hard to cheat an honest person, they take the time to notice what is going on around them, and they ask questions. Let’s all take time to think about how we can become better at detecting and deterring fraud so we don’t end up having to defend against it.

 

April 11, 2011

Fighting Fraud By Connecting and Detecting Globally


As the world gets smaller from people traveling more, gaining greater access to information via the internet, movies, television and cellphones, we seem to be sharing at a rate that astounds and thrills the number crunchers. We now share everything from secrets to solutions, inventions to investigations, and things that shouldn’t be mentioned let alone take place. This includes new ways and means to commit fraud including establishing complex webs that challenge the best of us in fraud investigation, as well as ways to counterfeit almost every product manufactured. But as fraud fighters, we are learning how to use that to our advantage. As much as the internet causes us to throw our hands up in the air in frustration we also have shouted loudly with joy when a fraudster unwittingly leaves a trail for us to follow. And we thank them for that.

The best way each of us can reduce the risk of fraud is become educated, connect with each other and work together as transparently as possible. The more we leave the old ways of hoarding our tips and tricks, the stronger we become in unity. By now, most cities, counties and states as well as federal agencies are beginning to understand this and the old network of closed doors is opening up to free-share ideas and solutions. But even better than this is that a new level of young professionals have grabbed onto the possibilities and are both teaching and putting into place ways to be more efficient and effective in the fight against fraud. I applaud all of you who work to share your concerns and network to find solutions. In my effort to continue sharing, I have listed below some sites I have come across recently for you to review and share with each other. I by no means participate in them, or receive any benefit from them. Nor do I present them as the perfect find, but I do find the information to be interesting and provide some ideas to pursue for further consideration and self-education. Keep up the good fight and continue to stay true to your morals and ethics as we all continue to be challenged in life as times become more difficult and trying of faith and patience.

http://blogs.gartner.com/avivah-litan/2010/12/15/2011-threats-and-trends/

http://threatmetrix.com/threatmetrix-announces-fraud-prevention-trends-for-2011/

http://news.hostexploit.com/cybercrime-news/4794-changing-internet-fraud-trends-highlighted-in-ic3-2010-report.html

http://www.publishingtrends.com/2011/04/bloggers-weigh-in-on-the-kindle-swindle-and-new-fraud/

http://www.nlets.org/press/internet-crime-trends-the-latest-report

March 26, 2011

Potential for Elder Fraud on the Horizon


Hello Everyone. I know its been awhile. Today I would like to share concerns from various conversations with others in the elder care community. This group includes tax preparers, CPA’s, business litigators, caregivers, senior care facilities (both assisted living residential and commercial), and health care workers, and fraud investigators. Why?

Well, as most of you have heard that the number our seniors that have aging parents now needing to place them into assisted care and skilled nursing homes and facilities are increasing. Most locations have been able to accommodate the ebb and flow of family and friends seeking help for their aging parents, spouses, partners and family members. Recently I was visiting an assisted living facility and the executive director commented that he no longer has rooms for the growing number of requests he receives on a daily basis. In fact, he now has had to create a waiting list without any way of assuring the families of a time frame when their loved one can be cared for by skilled staff and in a safe environment.

Which brings me to the next point. Due to the huge and I mean that quite literally, huge upcoming increase in senior/elder care needs, locating affordable and qualified care will be in high demand. This creates a large pool of vulnerable adults open to be preyed upon by the fraudsters in the health care field. This includes medical billing, quality care and safe environments where abuse is not tolerated or able to take place, qualified and vetted personnel (as in proper background checks and monitored activity), not to mention reasonable costs for the care received.

One women in a caregiver support group was aghast when she found out that a facility wanted to charge her a very large administration fee, first and last months space/care fee, a cleaning deposit, and a slush fund for small care needs. This amounted to over $10,000 up front for the first month of care. Most families can barely cover the costs of taking time off to care for a loved one let alone the initial upfront costs to begin care. This was a residential home that was set up to care for six elderly residents, and was part of an LLC that included six other homes just like it. There are many of these homes that work very hard to take very good care of their residents. But this home was not well maintained and the individuals that ran the home allowed family members to come and go and hang around as if it was a normal family home, served only their ethnic foods and was not keeping up the care on the home. This was very disconcerting to the woman and she did remove her mother from the home and chosen to take care of her herself. Which is what many are choosing to do because the costs end up meeting the same as the income they were trying to earn in the first place.

Now, having said this, I know for a fact that a qualified care facility with little turn-over and properly maintained premises is not cheap. Paying the staff what they deserve for the hard work, and think about it, it is hard work otherwise we would not have the need for these types of residential and commercial care locations, are key to running a safe and clean environment. Familiarity or routine is key to helping the elderly feel safe and willing to participate in the care they need. One director told me it takes close to $2000 per new employee to get them properly trained at the level he felt was key to providing the care expected for the fees charged and to remain in compliance with state laws and regulations.

Which brings the next point. There are no standards for care and costs regarding taking care of our elderly citizens aside from the currently established medical and government codes and regulations on running a business or medical practice. That puts the burden on the family to research, vet out and locate places they can both afford and feel their loved ones are safe. This also means they are relying on the homes and facilities to do their ‘due-diligence’ regarding their personnel and policy and procedures.

So here is my final point – the biggest potential for fraud is that the needs will over run the availability of qualified personnel to care and monitor our vulnerable adults. Recent economic conditions create a situation ripe for fraudsters to prey on the elderly either directly or through their caregivers as everyone gets stretched beyond their limits. So here are some ideas that I would like the fraud community to spark conversations on to build a grassroots approach to keeping our loved ones safe and out of harms way.

First, educate as many of those around you on what elder abuse looks like and who and where to report it. Each local city/county has an organization to connect you to the resources available. Second, if you know of someone you think is being targeted or IS unsafe, please reach out to the local law enforcement and ask for them to check in and verify all is well. They have access to governmental agencies for support. Third, ask questions if you need answers regarding the cognitive skill level of our seniors. Early signs may be there and steps need to be taken so they do not become pray to neighbors, family, and other commercial entities looking for easy targets. This includes those of you working in banks and stores.

Now for financial exploitation – this is going to be a very serious situation in the next years ahead. The generation of seniors that are now reaching increased levels of dementia were raised during a time when they understood they needed prepare for retirement. This means most of them have squirreled away some sort of funding to cover their final years. These savings have become an easy target for family, neighbors, and I am sorry to say fellow members of religious organizations to zero in on for support. Befriending the elderly can be easy because they believe in giving people the benefit of the doubt, which means most of them if they are lonely, and they usually are, end up trapped before they know and then have no means to reach out in time to protect themselves from the leeches they have welcomed into their homes and life. Not to mention, if they are in a state of dementia they will not remember what they recently did or agreed to at the time they were parted from their financial future.

Here are some sites to research and get your selves prepared to protect our seniors from harm:

http://helpguide.org/mental/elder_abuse_physical_emotional_sexual_neglect.htm

http://ctwatchdog.com/category/finance/elder-care

http://www.ncea.aoa.gov/ncearoot/Main_Site/index.aspx

http://www.apa.org/pi/aging/resources/guides/elder-abuse.aspx

http://www.calbankers.com/post/preventing-elder-financial-exploitation-how-banks-can-help

http://www.elderangels.com/

http://www.elderangels.com/

 

December 7, 2010

Tis The Season To Be Thieved


I know, it’s not a real word. But recently two of my friends found out their debit/visa cards had been compromised. Both of these people are careful with their information. So, how did this happen. There is no real way to determine exactly what happened, but we have pin-pointed when it started and worked our way back to the most likely place it happened. So I decided that because most of us will hear from someone we know who had their holiday interrupted by a fraudster. So let’s be prepared to stop them as best we can by staying sharp and prepared to act quickly should something happen.

Once you find out or suspect, contact the bank or lending institution’s fraud department. Go over the recent purchases for the few days. You will need to answer some questions and fill out a form you receive in the mail. If you card is compromised, you will need to cancel the card and wait till you get a new one. Some credit unions can now reissue a card on site, others require you to wait till they can mail the replacement.

Advise the 3 credit union reporting agencies that your card was compromised. Now this is key, you can put a ‘freeze’ for three months or just have it on file that no more purchases can be made on a previous card/account. If you freeze for the three-month period, you cannot open any new accounts or take loans out without going through a process. So think carefully on what you want to achieve. The credit agencies will walk you through your options. I would also suggest getting a three to six month credit watch to catch any other potential problems.

SOME SCENARIOS TO THINK ABOUT

First you need to remember that fraudsters plan for the holidays just like the rest of us. And they know that this is the time we get scattered and forgetful. Here are a couple of scenarios to think about as you shop and eat your way through the holidays. Take some time to find out what is going on out there and then stay aware.

PICTURE PERFECT FIENDS

These people can memorize numbers, names and pictures in a what seems nanoseconds. And, this is most likely what happened to one of my friends. This scheme happens when someone stands behind or within visual range of your activity at a check-out stand (cashier). When you pull out your card to swipe it, most of us hang on to it or set it down while waiting for the cashier to finish what he/she is doing. In that moment, the individual behind you memorizes the card name, number and necessary details. Yes, it’s that fast. They often don’t purchase anything, they excuse themselves from the line with some excuse and get into another line later. They only need to do this a couple of times to get enough card numbers to go and create a fake card and then test it out by purchasing small items. Usually at a grocery store or gas station. If all goes well, they try again with a higher amount and if that works, they go for broke.

TAKING A BITE OUT OF YOUR WALLET

Another way is when hand the card to the cashier and he/she is processing the card and the card gets skimmed either along the side of the register or underneath the register. This is a more rare scenario as most of us would see this action. However, if you are at a restaurant, the card goes back with the server and can get skimmed by them and then processed at the restaurant as well.

SURPRISE, ITS A FAKE

Also, it is a good idea to make sure the server returns your credit card and not a substitute. ALWAYS check the card returned to you. Accidents do occur, and that could make someone else who gets your card and leaves a happy scammer to, but you can avoid that easily by making sure you check the card you received as well as the receipt you sign.

In closing, it’s always best to Google current fraud schemes. You would be amazed at what fraudsters come up with each season. At the same time, it’s very sad that the same old con-methods continue to work every day. Stay safe and be aware during the holidays.

SOME LINKS FOR VIEWING

I have just started to check out this website Scambusters. They have some good information regarding fraud, but they also sell products. I will let you know if I get valuable information later on after some time to review their ongoing newsletters.

Another recent find, today to be exact, is this site InventHelp. They have quite a variety of scam and fraud information. I will report back later on how their information was helpful to me. But they did have some helpful information.

And don’t forget the FED‘s; the love a good take-down on the bad guys. Also, this site IC3 is good for information and to report fraud crimes. They work very closely with the FED’s and have good information for Internet safety protocol and scam information.

Stay Safe and Report Fraud!

 

November 8, 2010

Fraud Victims – When Do They Get Their Day In Court?


I have recently received several responses from victims of fraud asking what it takes to get their cases heard in court. Their plea for help is painful to hear and all of us that investigate and work fraud cases understand that this is not  a small problem, that it is part of a bigger picture. So how do we answer these cries for justice when the there are so many obstacles to overcome?  Let’s talk about the obstacles in getting cases to court.

THE MANY FACES OF FRAUD

Fraud comes in as many forms and is committed by as types of perpetrators as you can imagine. Unless the perpetrators are strung-out drug addicts, they look just like you and me. They are our neighbors, friends, family members and business partners as well as con-artists out looking for a ‘mark’ or victim. They are rarely like the characters pictured in CSI, NCIS and other crime shows. And the timing from start of a case to asking the questions, getting the information and forensic reports back, getting the proper warrants and subpoena’s to get the fraudsters booked takes place is in not hours or days, but months of hard work and focus. Many investigators go out of their way to help fraud victims, but these are not the stories we hear about. This is especially true in elder abuse and exploitation cases, and crimes against children.

WHY DO THEY SAY THEY CAN’T HELP ME?

First, the levels of creativity and focus by fraudsters is undeniably surprising. Most of us that are in the trenches regularly mumble to ourselves that if fraudsters could focus their attention and creative problem solving skills towards the problems of humanity, we may just solve some serious world problems. But they don’t and have all day and lots of connections to find latest, greatest and often complex methods to get ahead of the rest of us. This means the battle to catch and try them involves constant learning, adapting current skill sets and gaining access to new technology. Ask any government office which version of software or hardware they are using and they hang their head and sigh.

The economy has not helped this situation at all. Most law enforcement departments are being hit with increased demands to process fraud cases, but are trying work them without an increase in manpower. I have heard some detectives have an ongoing case load of 15 cases on their desk at one time, and it’s growing. I recently spoke at a conference for law enforcement training about forensic accounting to give them the necessary steps to get ahead of the curve and understand the information they have to process in order to properly document and forward their cases to prosecution. It’s a start, but it’s costly and what ever money that is left over in the budgets is being funneled to keep the lights turned on.

That does not mean they are totally in the dark either. Most government agencies, offices and law enforcement personnel have begun to team up to go after fraudsters. The days of jurisdiction issues is coming to a close. Technology is allowing quick and efficient means of shared information. But it is starting in the areas of better funding and this means not all law agencies are going to be at the same level of technology and manpower. This also means it is going to take more than a village to catch a thief; it’s going to take counties, states and a nation to effect change. And don’t forget you the public. When the public cries out for justice; there is nothing more powerful than a grassroots movement to tell both politician and government that they are not happy with the situation on hand.

BUT I DID EVERYTHING TO HELP THEM AS ASKED!!!

In fraud cases, the victims are required to prove they are victims. This is because there are no physical signs that are tangible proof that a crime has occurred. A rape, murder or sexual assault has tangible evidence that can be processed and documented. But in financial crimes, evidence needs to be documented and verified by professionals. Officers of the law including detectives have not been trained (up until recent years) to work financial crimes. This is added training on top of their required training to physically and mentally deal with their original daily tasks. This is why they ask for victims to provide as complete and documented a case as possible. They are required to verify all that you provide before they can move it forward.

Recently, law enforcement agencies are starting to establish a ‘fraud department’. Most often this new department is manned by a detective or officer that is interested in financial crimes. This also means that funds now must be shared with a new department and all personnel must be educated on the protocol for financial crimes. This is not an easy task and can take a while to get all the necessary technology, training and directives in place. But I am seeing changes and the successes are getting noticed. Hopefully this will show the way for other agencies to begin changes necessary to take cases and move them up the system for prosecution.

YOUR DAY IN COURT

I wish I could say all victims will get their day in court. The courts are inundated by cases. Prosecutors are also overwhelmed. And anytime you involve professional experts, the process can get lengthened based on the complexity and level of detail the expert needs to present to educate judge and jury of the facts. Most jurors do not have any background on fraud or accounting for that matter, and the details need to be exact, simple to understand, and relevant; meaning no rambling on about debits and credits.

It is also expensive to take a case to court. The costs can be more overwhelming than the loss in some cases, and sometimes it destroys the victim more than the fraudster. But that doesn’t mean that prosecutor’s don’t want to take the cases or that detectives don’t want to process the cases. The bottom line lately, is just that. Time and costs are continuing to be obstacles. But again, steps are being taken to make change. In larger areas of population, both law enforcement and government agencies are collaborating on education and establishing standards of protocol to handle fraud cases. This is KEY to bring the necessary change and produce results. Nothing can happen without all agencies and personnel being on the same page to fight crime and provide its citizens the personal rights of safety and freedom from abuse.

YOUR COMMUNITY NEEDS YOU

Having said that, it is also up to the public to report crimes and to hold their own accountable. Often, fraudsters are able to move about society freely because they have been protected by those close by them, or because victims have not reported their crimes. As scary as it sounds, if you don’t file a report, it doesn’t get on the books and into the system. Often law enforcement will check with each other and if they find out they are familiar with that name or their system pulls up that name (even if they were not convicted), the officers have a suspect with a possible fraud pattern. It adds bite to their efforts to stop the thief.  And, there is nothing worse to hear than other victims come forward after the fact, when the fraudster could have been stopped years ago. In order to truly stop criminal fraud, there has to be a grass-roots effort. This includes to understand where the line of ethics and moral standards begins. This includes setting examples at home and work that casual theft, aggressive behavior, and entitlement are not acceptable in our society.

IN CONCLUSION

I realize this is a lengthy post. But I felt it necessary to let those that follow my blog and are victims of fraud, that we do hear the cries of frustration, anger and resentment. That we know there are cases not being handled as quickly, and sometimes, at all. And that what they hear are more than excuses; that there are real obstacles that are being hurdled as we speak, and that change is coming. We are all part of this problem and it will take all of us to resolve it. The public needs to send a message that entitlement is not a right or excuse to take another’s property or livelihood. That is comes with penalties. That as a whole, we the public, in this nation will not tolerate such behavior and empower those dedicated to detect, deter  and defend against perpetrators of fraud, the funding, manpower, and tools needed to protect and take care of our fellow citizens.

September 20, 2010

Seniors For Sale – The Elderly At Risk


This post is to bring awareness of how important it is for all of us to protect our senior citizens. The Seattle Times has investigated and published their findings on elder abuse in Washington. It is a four-part series and I have put the links through out my post.

The Elderly At Risk

Seniors citizens who now include the “Boomer” generation, are the men and women who have spent a life time as mothers and fathers, brothers and sisters, and neighbors and friends. Their lives are rich in history, experience and knowledge. They remember horse-drawn-buggies, the first television set (in black & white), the first man on the moon, and how fast typewriters became computers. They fought in world wars and foreign conflicts that defined the countries we now see on every map. Many remember the Great Depression and can still stretch a dollar today as well as they did back then. Many are proud to state they were born into the territories of Alaska and Hawaii before statehood. All of these men and women accepted the label as senior citizen when they retired from companies after decades of employment. They worked hard to prepare for a future of self-sufficiency with a hope that when the time came, when they could no longer properly care for themselves, family and friends would be there as they were for them.

However, times have changed. We are living longer, and most families are now spread out from the Pacific to the Atlantic. Our grandparents and parents no longer have easy access to immediate family and most households require two-income earners to care and manage a home. Living longer than planned for, and without the ability to have immediate access to family, most seniors have joined the ranks of the “Elderly at Risk”. These men and women once self-sufficient, have trouble with basic home and health tasks not to mention paying bills to cover the growing medical needs. They get lost easily and struggle to understand the world around them. Families struggle to keep up with their care and eventually seek out help. Some connect with local community groups and state agencies. Others locate and make arrangements for adult daily caregivers, either at home or away.

Due to monetary constraints, many families opt for more intimate care in a residential house set up to care for four to six elderly residents. These Adult Care Homes are usually someone’s personal residence that is transformed into a business designed to meet the needs of families in search of intimate care and attention for their loved ones. Many of these elder care businesses are run by people who have the patience and skill sets to feed, bathe and properly monitor the emotional and medical needs of our elderly loved ones. Unfortunately, there are also homes and caregivers that only see the elderly as a source for income.

It is important that all of us, and I do mean all of us, to understand the role we all play in this situation. We as family members, need to learn that when we entrust an elderly member of our family to someone else, we must remain vigilant in our effort to follow-up on the level of care they receive. Not just visually, but the under current of what happens unseen on a daily basis. When you visit a home or facility, you need to use all your senses to determine if this location understands the ethical and moral expectations to provide a caring and conscientious environment focused on the needs of your loved one. This includes the emotional, spiritual, mental and physical needs.

And, if you have any concerns, these need to be addressed then and not later. What do you smell? What do you see? What does the kitchen look like, the rooms, the bathrooms? How many residents? Can you contact the other resident families for references? What are the caregivers’ backgrounds?  Do they do background checks on any of the other caregivers working there? It is okay to trust, but verify the information given.

And take the time to go and visit unannounced, often. Check to see if there are any bedsores and what they are doing if they do develop. If the caregiver is in your own home, don’t be afraid to have your home monitored to ensure care. If your loved one suddenly seems nervous or emotionally withdrawn, check into it. Don’t be afraid to contact any of the police departments if you are worried in any way. One of law enforcement’s biggest concerns is that they don’t find out about a serious situation until it is too late. In June of this year, new laws were enacted to help protect victims of elderly abuse.

When we become numb to the plight of our elderly, we become numb to the value of life. While a parent may no longer be a joy to be around, they do not deserve being treated as a commodity. They are still someone we love, but whose physical and sometimes mental abilities have transformed them in our eyes into someone we can no longer relate to or connect with. This is what makes them the most at risk – they can no longer communicate what they are experiencing on a daily basis.

I would like to report that the there are only a minor group of instances where our seniors have become victims of abuse. But this is not the case. More and more of our loved ones, are unnecessarily being harmed by fears of caregivers loosing their reputations and thus loosing income. The Seattle Times investigation revealed that many instances of neglect or abuse remain hidden and not reported to the proper agency.

The adult care homes have suddenly become a business that can be sold as such, with residents included. This business transaction is not any different, than when a hospital is sold and the patients become under new management. Except for when a hospital is merged or purchased, there is a level of transparency expected. When an adult care home is sold or placed on the market with a real estate agency, the residents can be included as part of the asset or value of the home.

So it is important, that when you choose to entrust your loved ones to a facility or residential adult care home, you do your homework. Understand the area, the home and the owners and caregivers. Apply the same level of due diligence to find the right care for an elderly parent as you would with your baby or child. Value age and the vulnerability it brings as you do with youth and its vulnerability.

August 24, 2010

Fraud & Forensics: Times are changing…are we?


Most of you are familiar with the CSI shows on television. And you have read articles on fraud examiners catching the Madoff’s of the world lately, but most of you don’t know the process forensic accountants, fraud examiners, and law enforcement go through to quantify or qualify the information for their clients and the court. It’s not a glamorous process and it doesn’t happen in sixty minutes let alone sixty days. It’s a tedious and detail oriented process that requires pulling hundreds if not thousands of bits of information into one historical reference, and the process has been in place for a very long time. But Dylan was right, times they are a-changing.

The recent shifts in technology have made the amount of data exponential, and this means the time to manage and analyze have also become exponential. Cases now span years instead of months. Imagine an embezzlement case over five years with one hundred clients and their historical information. So how do you provide your clients with a work product using what I call the F.E.E. principle: Focused, Efficient & Effective?

In my usual internet nosing around I found this article “Follow the Money – Find the Fraud” by Tracy L Coenen, at Sequence Inc from the Wisconsin Law Journal, written by Tracy Coenen, CPA, CFF in June of this year. It’s a article about how we each must consider the complexity of our case. What are we faced with? How can we wade through mounds of documents and data and deceptive efforts to get to the facts and then put all of that into a format that educates the facts to both judge and jury. I think this article will help you ponder this thought and hopefully consider some new ideas. There is a lot out there to choose from, but in the end it is about the truth and the best and most efficient way to get to that truth. Facts speak loud, but they rarely shout ‘here I am’.

I would also like to add that technology does NOT replace the ability to interview and investigate, but it does allow us to more efficiently get to the facts to build a case and prepare that case for litigation. Remember, fraud examination and forensic accounting is not about technology it’s about the truth of the situation; the prima facie evidence necessary to present a case if you choose to go to trial.

TIP: CFF means Certified in Financial Forensics – see link above.

July 27, 2010

Is CAPTCHA Dead?

Filed under: Fraud Schemes,Fraud Trends — fraudjournal @ 2:26 PM
Tags: , , ,

One of the discussions running around the fraud blogs and LinkedIn groups is about how fraudsters have been able to get past CAPTCHA. So is it dead? That question was asked in a 2007 article when Google filed for a patent that would allow computers to read images that contained a graphic of morphed characters. (http://www.blahblahtech.com/2008/01/google-patent-captcha-killer.html)

And if you ask the internet about CAPTCHA, you will find various requests to locate a program that would essentially ‘kill’ the CAPTCHA program temporarily when dealing with other languages. So is it dead? Not yet. Businesses and websites still are using this program as a security measure. So what is the fuss?

Most of you have already experienced CAPTCHA without knowing it. This is when you are required to type in what you see on the screen (usually a set of twisted or distorted letters, numbers or combo of both) when you purchase or create an account with an online storefront or organization. If you don’t, here is a link to Wikipedia to learn (http://en.wikipedia.org/wiki/CAPTCHA).

Recently in New York, scammers created another work around by setting up a network of users to purchase tickets online from Ticketmaster. The company under indictment ‘Wiseguys.com’, purchased the maximum of number of tickets to big name concerts and events by employing a vast network of purchasers who could type in the semi-obscured graphic used as a security measure to stop scammers from purchasing more than the allowed number of tickets. These tickets were then scalped online for prices far above the normal retail value. So, now you know why some of those concerts were sold out so fast and so many tickets were for sale online.  You can read the article here: http://www.nbcnewyork.com/news/local-beat/Ticket-Scalpers-Defeat-Latest-Cyber-Security-85808497.html .

So how does this effect the fight against fraud? It means that fraud has truly become a global concern. While it creates jobs in India and China, it also allows fraud rings to branch out and work towards becoming an even bigger menace than before. If the sources of scamming is off-shore, then the process to shut them down becomes much more complicated and deals with multiple jurisdictions. Plus their costs are minimal, they have a dedicated work effort can be a 24/7, and you and I can’t see them at work. It allows them to blend in or hide in plain sight.

The economy is already creating budget havoc for everyone. Law enforcement is already overwhelmed with fraud on the grand scale, which means it is up to you and I to stay aware of what we see on the Internet and around us today. Help your local and regional fraud teams by reporting fraud when you see it. And don’t buy scalped tickets – most often they are not your everyday you and me that ended up with spare tickets. It’s guys just like the scammers ‘wiseguys.com’ that stole your right to purchase them at the retail price in the first place.

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