1. Detect and Prevent Employee Fraud

Detect and Prevent Employee Fraud

Event ID: 2166324
Recording: Unable to attend? A recording will be available after the presentation.
Date: Recorded on 1/22/2020
Duration: Scheduled for 90 minutes including question and answer period.
Presenter: Gary Deutsch, CPA, president, BRT Publications, LLC
Credits: 1.5 NASBA (Management Services)


Detect and Prevent Employee Fraud

Recent headlines shout: “Manager Steals $600,000,” “CFO Confesses to $20 Million Embezzlement.” Can’t happen to your institution? Think again. These incidents can happen to any institution and in many jobs within the bank or credit union. Is your institution prepared to detect fraud early to minimize losses? Are controls in place to prevent fraud? Will your preparations satisfy the regulators?

Although coverage is rare, few institutions want publicity on this, employee fraud does happen in financial institutions and regulatory expectations are that you keep a close eye on this potential vulnerability. Cases range from theft of cash in branches to senior officials falsifying documents. No area is immune. The largest losses occur in lending, but deposit operations is a frequent target as well. Sometimes bank employees conspire to alter accounting records to save a failing institution or conceal their errors. Worst of all, frauds often go undetected for years. When they are finally discovered, losses have already grown to material amounts of money. Some institutions have even had to close their doors.

The FDIC virtually mandates two weeks of consecutive vacation for active employees and officers to facilitate employee fraud prevention. Regulators are serious about detecting any potential employee fraud, and you need to be as well. After the fact, the question often arises: “How could this fraud go on for so long and cost the institution so much money?” Invariably, the answer is that internal controls were not followed and management let control weaknesses slide because there was more pressing business to attend to.

In today’s environment, a large fraud loss could be devastating and the cost to you beyond direct financial loss could be even more incapacitating. Increased regulatory scrutiny, the time and focus costs in dealing with the aftermath, and the potential for adverse publicity can significantly damage your institution.

To help your institution detect fraud early or even avoid it, please join Gary Deutsch as he provides hands on guidance and examples on how to improve fraud controls and establish and maintain an effective fraud audit program at your institution.


These crucial issues will be discussed:

  • Examples of frauds committed
  • Why opportunities to commit fraud exist?
  • Methods for assessing fraud risks
  • Setting a zero-tolerance tone
  • Control weaknesses and cost-effective solutions
  • Establishing an antifraud team
  • Dealing with fraud once discovered

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