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Title :
Role Of Insider In Banking Fraud
Author : Ms. Saloni Sharma
(This article has been contributed by Ms. Saloni Sharma and
Anuradha Brahma)
The occurrence of frauds in the banks is not a recent
observable fact; infact the misdemeanor of forgery is perhaps
as old as writing itself. Of the inestimable types of financial
offences that our nation and all countries across the globe
have had to eyewitness and undergo from, a major one is
financial frauds caused in the banks popularly know as “Bank
Frauds”. Any organisation which deals with money is always
vulnerable to frauds and this is more so in the case of
financial institutions like banks which are dealing only in
money and that to as a business commodity. Bank frauds are
on the augment. The graph of fraud money is mounting
steeply. The reasons for increase in number of frauds in the
post nationalization period is attributed to a numerous
reasons, the most likely ones are the widespread branch
network, lack of trained staff for the expanding network and
a shift from the security oriented lending to the development
oriented approach i.e. advances to the priority sectors.
Frauds in Indian banks only prove that financial liberalization
aggravates the inherent tendency of shallow markets to
foster excessive speculation and worsens the systemic
consequences of such speculative activity. Revelations of
fraud, evidence of insider trading and a consequent collapse
of investor interest have led to an almost unstoppable
downturn in Indian banks. Bank frauds concern all citizens.
It has become a big business today. Bank frauds are the
creation of professional criminals, desperate customers or of

errant bankers or their collusion inter se. However the prima
donna in the drama is the insider or the banker. He opens the
purse. He is often the target and at times the tool.
Occasionally, he is the victim of the temptations. Other
contributory factors are incompetence, lethargy, negligence,
connivance and ignorance. Situational pressures and
permissive attitudes of the society promote them. High gains
and low stakes encourage the incidence. The rising trend
makes it more and more important that ways and means are
found to combat the menace.
Fraud is any dishonest act and behaviour by which one
person gains or intends to gain an advantage over other
person. The gain may accrue to the person himself or to
someonelse. Fraud causes loss to the victim, directly or
indirectly. In earthly terms bank frauds include all sorts of
misappropriations, embezzlements, manipulations of
negotiable instruments (cheques, drafts, hundies, bills or
statements of accounts, securities etc.). Also included are
misrepresentations, cheating, thefts, undue favors and
irregularities. The frauds may be intentional or incidental
and can be committed by (I) the bank employees themselves,
(ii) the staff members of the banks in collusion or connivance
with the customers or outsiders, and (iii) the customers or
The word “Fraud” has been defined in the Indian Contract
Act. In short fraud is dishonesty leading to loss to someone.
Dishonesty is never accidental. Therefore there is always a
swindler behind each bank fraud. The number of bank frauds
in India is substantial. It is increasing with the passage of
time. Bank frauds are due to the bunko and the bungler
bankers, situational pressures and permissive attitudes.
Fraud has not been defined in the Indian Penal Code directly.
However sections dealing with cheating, concealment,
forgery, counterfeiting, misappropriation and breach of trust
cover the same adequately.
Hence what this paper fundamentally tries to focus on is on

the banker’s responsibility vis-à-vis the reach of deception
therein, consequences of such incident and tries to look into
the entire possible panacea to such a menace in the society.
Banker’s Responsibility in a Fraud
Bank frauds crop up in all spheres of banking dealing, like:
Cheque frauds, Deposit account frauds, Purchased bill
frauds, Hypothecation frauds, Loan frauds etc. A dishonest
banker can play havoc with the bank’s money. The bank has
therefore to sentinel itself and its customer’s against the
deceitful employee. The vicinity of business of the banker is
extensive. The following operational avenues have been
noticed time and again. Manipulation of cash by those
handling cash, misappropriation of customer’s deposit
accounts, misappropriation of money in telegraphic
transfers, clearing forged cheques and other instruments,
fraudulently while working in clearing departments,
creaming of the sundry accounts, tinkering with the central
accounts, accepting counterfeit currency for a consideration,
helping the bank robber, by giving information etc.
An analysis of frauds reported by banks to RBI broadly
indicated that frauds perpetrated on banks could be
classified into the following categories:· Misappropriation of cash tendered by the banks
constituents and misappropriations of cash remittance.
· Withdrawal from deposit accounts through forged
· Fraudulent encashment of negotiable instruments by
opening an account in fake/fictitious name.
· Perpetration of frauds through clearing transactions.
· Misutilisation/overstepping of lending/discretionary powers,
non-observance of prescribed norms/ procedures in credit

dispensation etc.
· Opening/Issue of Letters of Credit, Banks Guarantees Coacceptance of bills without proper authority and
· Frauds in foreign exchange transactions, mainly through
non-adherence to exchange control manual provisions.
Major Cases for Perpetration of Frauds
· Laxity in observance in the laid down systems and
procedure by operational staff and also by supervising staff.
· Over confidence reposed in the banks constituents who,
however, indulged in breach of trust and
· Frauds committed by unscrupulous constituents by taking
advantage of laxity on the part of the officials in the
observance of established Time-Tested safeguards.
Types of Bank Frauds
Ø Cheque Frauds: cheque frauds include frauds relating to
customer’s cheques, banker’s cheques (drafts) or traveller’s
cheques. They are the most important frauds both loss-wise.
They take the following forms:
ü Issuance of Cheque Book under fake authority, frauds of
this type have taken place where the miscreants have first
successfully obtained the chequebook in the customers
account and later got encashed cheques under forged
ü Frauds due to payment of materially altered cheques etc,
these types of frauds are very common. The miscreant
obtains/steals the cheque, materially alters the particulars of
cheques and presents over the counter for
payment/collection in the account with introduction/fake

ü Payments of cheques under forged signatures, such types
of frauds are generally perpetrated by the
employees/partners of the account-holders.
ü Stolen Drafts/TPO leaves and issuing drafts on other
branch without consideration under forged signature or
otherwise, such types of frauds are committed by the staff as
well as outsiders. The miscreants manage to have access to
such security forms and either the whole book or some
leaves out of the book are removed. The drafts are presented
to the drawee branch for payment/collection. Before
collection new accounts are opened without proper
ü Frauds in clearing transactions, this area is also grey for
frauds in clearing process the sub-branches send their
cheques to main branch and receive some cheques from the
main branch. In delivery/receipt of cheques the miscreant
removes/destroys some cheques manipulating the
acknowledgement received/delivered to the main branch.
The credit for the removed cheques is released without their
actual presentation to the drawee bank. Such frauds are
detected after long time where reconciliation takes place.
ü Frauds withdrawal against cheques sent in clearing-kite
flying operations, misuse of cheques purchase facility
without arranging for funds i.e. advances being allowed for
self cheques, accommodation cheques or uncleared effects.
The branch managers of different banks in the same place,
acting in collusion with each other and along with
constituents, allow kite-flying operations.
ü Counterfeit bank drafts, traveller’s cheques and other
cheques are cashed.
ü Forged fingerprints are used on the instruments of

illiterate persons.
ü Cheque-writers are employed to hide the fraud.
Ø Deposit Account Frauds: these frauds take the following
formsü Accounts opened without introduction or with improper
introduction, frauds under this head are generally attempted
at the time of opening of new branch when such emphasis is
not paid on obtention of introduction. Once the account is
opened, the miscreant deposits, stolen/materially altered
cheques for collection/payment etc.
ü A dormant account is fraudulently operated by a forger on
forged signatures. Specimen signature card or signatures on
letters are utilized as models.
ü Joint accounts are operated by one of the signatories
(forger) by forging the signatures of others.
ü Mini deposit collections are not deposited by the collecting
ü The banker becomes joint account holder and withdraws
the money.
ü The banker manipulates the depositor’s Pass Book.
Ø Purchased Bill Frauds: the frauds in this area are often
costly. They can take the following forms:
ü Bogus or stolen railway receipts and motor transport
receipts accompanied by counterfeit bills are discounted.
ü Fake bills with inflated value, drawn on sister concerns, for
ü Genuine bills and railway are presented and got discounted
from the bank but the material is got released from the

railways on indemnity bond.
ü Bogus bills for worthless goods are discounted on the
strength of dispatch papers.
Ø Hypothecation Frauds: cash advances, against pledged
goods, as security are fertile fields for frauds.
ü Stocks or part thereof, are removed unauthorizedly from
the godowns.
ü Advance against pledge/hypothecation of securities,
pledging inferior quality of goods, overvaluation of stocks.
Ø Loan Frauds: the general policy of the government is to
encourage loans to agriculturists or to small artisans and
businessmen. Infact, certain targets for these purposes are
fixed for the banks. In the initial stages, it resulted in losses
to the banks due to lack of expertise in the field. The
following types of fraud were perpetrated.
ü Loans are taken by different persons on the same time.
ü Nomadic artisans obtain loans and vanish from the scene.
ü False firms appear everywhere and obtain loans.
ü Loans taken for agricultural development were later used
as marriage celebrations.
ü In connivance with the suppliers, farm machinery bills
were inflated for accessories which were never supplied and
included in the bills.
ü Farm machinery purchased with loans and hypothecated to
banks is sold without informing the banks or returning the
Ø Fictitious entries made in book/ manipulation of

ü These frauds normally take place with the active
involvement of staff or where the books are exposed to the
members of public. In such cases, subsequently the record is
Ø Cash shortages
ü Cash the most sensitive asset of the bank is prone to fraud.
The shortages of fraud there is generally due to
carelessness/negligence of the concerned staff who are the
joint custodians of cash.
Ø Frauds in Borrower Accounts
ü Advance against clean/documentary bills
purchased/discounted. The borrower committed frauds by
tendering fake bills/accommodation bills/cheques for
discounting. Later when the bills/cheques are received
unpaid, the banks find it difficult to recover the amount.
ü Advance under some priority sector schemes.
ü Advance granted in haste or at the behest of top
management or any pressure or some consideration.
ü Incomplete credit information
ü Lack of post disimbursement supervision.
ü Mis-use of discretionary powers or exceeding discretionary
powers by Managers/Officers.
Ø Frauds in Investment Portfolios
ü Investment portfolio which constitutes a big chunk of the
total assets of a bank is another fraud prone area. The dealer
in securities in the absence of proper policy, direction and
adequate system of checks and balances may misuse the

position for his personal gains to the detriment of bank’s
interest by putting through deals for passing on business to
the brokers which are otherwise not warranted by business
Ø Frauds in Foreign Exchange Areas
ü Frauds in this area are perpetrated in the dealing room
operations, documentary credits, export-import transactions,
packing credit etc.
ü Some of the dealers have been put through fictitious deals
with the help of brokers due to lack of back-up functions.
Ø Frauds in computerized environment
ü Hardware errors disable the working of any of the
component of hardware with a view to
creating/temporary/permanent malfunction to either destroy
the data or present its disclosure for security. Prgomme
errors are created by miscreants to cripple the system or to
siphone off the funds to unauthorized accounts or to
prevent/reduce charges to select accounts. Data entry errors
are created by staff to give undue gain to interested
accounts. Errors are made to give a wrong picture of sentive
data such as balances, classification of advances, outstanding
dues, interest rate applied etc.
Ø Frauds in inter branch and inter bank accounts
ü Debiting bank accounts without remitting cash.
ü Debiting branch adjusting account without remitting cash.
ü Adjusting branch books-clean cash.
ü Fraudulently debiting/crediting Head office account.
ü Debiting/Crediting various deposit accounts without

Departmental Inquiries, Police Investigation and
Punitive Action
The foremost steps in all cases of bank frauds are to
ascertain a prima facie case that a fraud has been
committed. This is essential because in some cases what may
appear as a case of fraud may be merely a case of negligence
or a case of failure of rules and procedures prevailing at the
time of occurrence. Or it may be just an unintentional noncognizable offence where no dishonest or criminal intent is
involved. To call a case of negligence or failure of judgement
as a fraud case may not only be fruitless but it may also
effect the morale and enthusiasm of dynamic bankers, who
serve and venture beyond the normal routine, to provide
better banking service and introduce innovations. Prima
facie case is established through a preliminary investigation.
It ascertains: corpus delicti, i.e. whether a crime has been
committed or not, the nature of the offence, the identity of
the culprits etc.
· Preliminary Investigation
These preliminary investigations are carried by bankers
themselves in most of the cases-infact in all those cases
where the case is not of an extraordinarily large dimension
and has not become a “darling” topic of media men. The
work s being taken up by a specialized branch of bank known
as the vigilance department. However vigilance departments,
in most of the banks are yet in their infancy and have not
developed the necessary expertise or strength to carry the
investigations have, therefore, to be carried out by the
branch manager of the affected branch. Preliminary
investigation starts with the information received from the
informant, the enquiries are extended to the victim, perusal
of the involved records and careful scrutiny of the files,
account books and other fiduciary documents. They reveal
facts which may indicate that a fraud has been committed.

They may also point towards the possible culprits. Or the
examination may reveal that no fraud has been committed.
· Departmental Processing
Real department processing starts after a prima facie case
has been established and a report on the preliminary
investigation has been accepted by the regional office. The
regional office ordinarily takes the following action: depute
some senior bank officer to verify the preliminary report,
instruct the branch manager to file an FIR, takes action
against offending employees, informs vigilance, head office
and audit and inspection departments, giving all the
available details in the proforma devised by some banks and
seeks guidance for further action. Processes insurance
claims and monitors progress and informs head office. The
decision, whether the case is to go to the police or to the
vigilance department or whether it is to be dealt with by the
administration department, is to be taken by the vigilance
department. The decision is based upon the evidence
collected in the preliminary investigations.
· Vigilance Department
Vigilance department of a bank plays a pivotal role in the
departmental processing of all cases of frauds. Vigilance
departments have come up in all the major banks with
varying degrees of responsibilities, functions and staff
composition. They receive the cases from various
departments and refer them to the appropriate authorities;
Legal cell, Disciplinary Authority, Disciplinary Action Cell,
Central Vigilance Commission, senior bank officers, localpolicies, CID, CBI etc. In addition they keep a statistical data
and monitor the movement of the files on the case.
· Central Vigilance Commission
The CVC plays an important part in all vigilance cases where
senior officers of the ranks of MMGS (Scale III) are involved.

Theoretically, it plays only an advisory role in cases of bank
frauds involving senior officers. The banks may not accept
the advice of the CVC. However in practice, the CVC has
complete strong hold. If the advice of the CVC is ignored, the
reasons for the same have to be put up before the
Parliament, where more harm is done than by the “ignored
advice” of the CVC. The bank, though, can delay its
implementation indefinitely by shutting the files to and fro at
the least speed it can muster. And the tortoise race, which
may easily go on for a decade, can be enchanting to watch.
· The Reserve Bank of India
The RBI carries out the post mortem examinations of all bank
frauds. All banks are requested to report details of all the
fraud cases whenever they are discovered to the RBI on a
standard format, formulated by the RBI and the banks. In
addition, the RBI obtains reports on bank frauds periodically
from all banks. The RBI has set up an Investigation Cell in its
central office also. It is manned by ace investigators of high
status and vast experience. It investigates cases like; bank
frauds involving very senior executives, bank frauds which
involve huge amounts, frauds involving more than one bank
and complicated bank frauds of high sophistication and novel
techniques. The bank team goes deep into the root cause of
the bank frauds and suggests exhaustive preventive
measures. The RBI carries out detailed studies and
researches in the commission of bank frauds and suggests
innovations to prevent frauds.
· Police Investigations
The police investigate cases which involve dishonesty and
criminal intent. Such cases are cognizable offences. It is the
duty of the police to take p investigation of all cognizable
offences, when they come to their notice or they are
informed about the same by anyone-in bank fraud cases
usually it is the banker, the customer, auditor, etc. even the
public is enjoined upon to report to the police such cases

which involve corruption, breach of trust or counterfeit
currency. The three police agencies which take up
investigation of bank frauds and other bank crimes are: local
police, district crime branch or the state Criminal
Investigation Department CID and the Central Bureau of
Investigation (CBI).
· Punitive Action
Punitive action against a defaulter not only deters the culprit
but also other potential defaulters. Punishment to the guilty
is, therefore essential to maintain discipline and rule of law.
The punishment must however be awarded with due regard
to the principles of natural justice and rules and orders
prevalent in the organisation. If they are not followed the
administration is described as harsh, unreasonable and
In a bid to keep pace with the changing times, the banking
sector has diversified its business; this has caused a dent on
credibility of the system in terms of control and supervision.
Many a times public funds are squandered in the guise of
“commercial decisions”. “Replacement of the philosophy of
class banking with mass banking in the post nationalization
period has thrown a lot of challenges to the management in
reconciling the social responsibility with economic viability”
well said by the CBI. According to CBI reports on various
cases on bank frauds, bankers often exceed their
discretionary powers in allowing credit facilities to certain
clients, which results in non-performing assets. They feel
that factors extraneous to banking should not be allowed to
influence the decision making process of bank officials even
in case of valued customers. Since banks have clear cut
delegated financial powers, sanction of credit facilities,
strictly in terms of prudent banking norms, should be
ensured. A large number of bank frauds also take place on
account of active-employee-outsider partnerships, in which

bank staff concerned facilitates the crime and are often its
undiscovered beneficiaries. Such cases are more difficult to
track down, particularly they are targeted for the operation
is different from that in which the guilty staff is officially
The dividing line between operational neglect and the
perpetration of fraud is rather thin, considering the growing
aspiration for effortless money which is always sweet,
because it is not hard-earned but belongs to the seating
taxpayer. If financial systems and their large financial
resources, drawn from public money, are to be protected, the
occurrence of fraud big and small has to be stamped out.
What is needed not another piece of complex legislation or
another high-powered expert body of the RBI, but analysis
and concerted application of controls by bank managements
and their operational staff.
Every law/regulation has ambiguity and loopholes, for the
criminally minded to take advantage of. Developed countries
like USA and UK have regulations to prevent and put a stop
to banking fraud for the past several decades. But every now
and then a major scam surfaces. Even if case of role of
insider in banking fraud is established, can it book the
“culprit” before he is encouraged to repeat it, in the light of
our complicated judicial process and the courts mindboggling backlog of work! With the long time lag between
the commission of an offence and the conviction of the same,
how can one ensure that the ill-gotten gains are taken out of
the hands of the perpetrator?
The role of insider in banking fraud, however, pernicious it
may be, is here to stay. For one detected case, there can be
numerous instances, which remain undetected. Constant
vigilance may reduce its frequency and magnitude, but
complete eradication is just not possible, at least in India
under the present social, political and economic set up.

Types of banking fraud
As a customer you may be seen as a potential target for fraudulent activities. However
by arming yourself with information and tools you can protect yourself from becoming a
victim of fraud.
Do you know the four biggest fraud threats you face?

Electronic fraud

Identity theft

Credit/Debit card fraud

Cheque fraud.
Credit/Debit card fraud

Credit card and debit card fraud is a crime whereby your credit or debit card can be
reproduced in order to use the credit balance to obtain a financial advantage. The
creation and/or alteration of a credit/debit card occurs when the information contained
on the magnetic strip is reproduced. This type of crime is known as ‘skimming’.
Credit or debit card fraud can also occur when your card is lost or stolen and used by a
third party to purchase goods with those cards or to remove cash from the cards.
Credit or debit cards can also be intercepted in transit while being sent to you. Your
cards can also be compromised by a dishonest merchant who undertakes unauthorised
duplicate transactions on your card.
Protect your credit / debit card:

Memorise your personal identification number (PIN). Don't use the same PIN for
all your cards, and don't choose your birth date or other easily identifiable numbers that
might be on something else in your wallet.

Check statements and call your credit card issuer immediately if you see
anything suspicious on your bill. You could help the company uncover fraud—and save
yourself from paying unauthorised charges.

Do not let your credit card out of your sight at anytime – for example, at a
restaurant – go with the card.

Card fraud is not applicable in Australia only – be just as vigilant when travelling
overseas, credit card skimming is an international crime.

Always sign your card in ink as soon as you receive it.

Keep track of when new and reissued cards should arrive, and call the credit card
issuer if they don't come on time.

Make sure your mailbox is secure, and that only you and the postal carrier have
access to it.

Tear up all credit card receipts and pre-approved credit card offers into small
pieces before you throw them away. Keep your billing statements in a safe place.

When you use your credit card online, make sure you are using a secure website.
Look for a small key or lock symbol at the bottom right of your browser window.

Never give your card number to strangers or telemarketers who call you on the
phone. Don't give your card number unless you initiated the call.

Cheque fraud

What is cheque fraud?
Cheque fraud is the use of a cheque to get financial advantage by:

altering the cheque (payee/amount) without authority

theft of legitimate cheques and then altering them

duplication or counterfeiting of cheques

using false invoices to get legitimate cheques

depositing a cheque into a third party account without authority

depositing a cheque for payment knowing that insufficient funds are in the
account to cover the deposited cheque.

How to protect yourself from cheque fraud

Reconcile your accounts promptly and regularly

Never sign blank cheques, and only sign cheques after all details have been

Limit the number of signatures to your account to ensure control.

Ensure that your signature is not with documents that can be accessed by the
general public.
Keep all cheques secure when not in use to deter theft.

Don’t leave any gaps in the completion of the payee name, amount in words and
in figures.

If cheques are lost or stolen contact ANZ immediately and ask them to stop
payment on the cheque.

Ensure that any invoices are valid before payment.
Consider using electronic means of payment (if possible) for high value

Ensure that your mailbox is secure to protect your inward cheques.

Electronic fraud

Email scams and fake websites
A number of customers from Australian financial institutions have been targeted with
hoax emails. These emails appear to be genuine bank emails.
Some emails inform the customer that their security details and passwords need to be
updated by logging into an authentic looking, but fake website. The purpose of these
websites is to obtain your log on details to access your bank accounts.
Others communicate security messages and advise you to install software from the
email that checks and removes viruses. By downloading the software you are in fact
tricked into downloading a virus.
ANZ will not send you an email asking for your Account Details, Financial Details, or
login details for ANZ Phone Banking, ANZ Mobile Banking or ANZ Internet Banking.
If you have any concerns, call the Internet Banking Help Desk on13 33 50

Identity theft

Identity theft is where your personal details are obtained to get some sort of financial
or other benefit, leaving you the owner of that identity often in large debt with a
negative credit history and in some cases with legal implications.
Your information can be obtained in many ways:

Theft, including theft of mail from your mailbox at home

By going through your garbage bins

Telephone, Fax and Mail scams


The following can be used to assume your identity:

Date of birth

Utilities bills (phone, gas, water and rates notices)


Given the revelations about alleged fraud within UBS, where Kweku
Adoboli is accused of losing the bank £1.4bn, it is worthwhile reminding
ourselves of some basic facts wrt frauds.

If you think that a fraud may be happening then fear the worst.
In my roles as Head of Internal Audit and International Forensic Co-ordinator, in
both Philips and De Beers, I have had many years of experience investigating
frauds. Based on this experience I have put together my personal ‘top ten’ list of
reasons why frauds occur.
1. Greed – good old fashioned human nature intervenes when an individual, or
group of individuals, sees a chance to make ‘a fast buck’. A good example being
those cases where people ‘adjust’ their expense claims upwards.
2. Lack of transparency - complex financial transactions that are difficult to
understand are an ideal method to hide a fraud. The Barings fraud was
perpetrated by use of an accounting ‘dump account’ that no one understood.
3. Poor management information – where a company’s management
information system does not produce results that are timely, accurate, sufficiently
detailed and relevant; the warning signals of a fraud, such as ongoing theft from
the bank account, can be obscured.
4. Excessively generous performance bonus payments – the more generous
the bonus, when coupled to a demanding target; the more temptation there is to
manipulate results, such as year end sales figures, to reach that target.
5. Non independent internal audit department – where an organisation’s
internal audit department is not independent, e.g. where it does not report to a
truly independent audit committee but to the Finance Director, the more likely that
when there are signals that a fraud is occurring the more likely they will be
ignored. It is indeed interesting to note that Cynthia Cooper (Head of Internal

Audit at WorldCom) had to bypass her boss (the CFO) and go directly to the
audit committee to report the discovery of the capital expenditure fraud.
6. Lack of clear moral direction from senior management – leadership comes
from the top. Where the senior management indulge themselves in ‘semi corrupt’
behaviour, e.g. adjusting their expense claims upwards, others will follow
adopting the well worn mantra ‘everyone’s at it’.
7. Excessively complex organisational structure - designed to obfuscate the
revenue streams; and so hide reality from third parties, such as the Internal
Revenue Service. Enron, with its complex off balance sheet structure and
transactions, is a textbook example of this.
8. Poor accounting controls– where the accounting controls, such as a monthly
reconciliation of the bank account, are lapse the signals that a fraud has occurred
will be missed.
9. Arrogance – some people believe that they are better than ‘the system’, and
that they can get away with anything. The late Robert Maxwell plundered his
company pension scheme, arrogantly assuming that since he was chairman of
the company he could get away with it; he almost did!
10. Complacency – I have met many a manager who has an almost childlike
faith, based in part on the ‘old boy’ network, in the probity of their colleagues;
believing that fraud ‘is not the sort of thing that could happen here’. Others will,
and do, take advantage of that trust.
My simple advice is, if you think that a fraud may be happening then fear the
worst; because it probably is.