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The Fraud Cycle

Allegation (Dugaan), Rumor

An investigators intuition or general suspicion (kecurigaan) that something is
awry (serba salah);
an exception from an expectation of a person senior to the suspect
(dugaan); (an unacceptable condition, profit, sales, cost, assets, or liabilities
are too low or to high;
The accidental discovery that something is missing-cash, property, report,
file, document, or data;
Result from audit
Results of control, especially anti fraud control.

Fraud as a crime
Fraud as a tort (kesalahan/kerugian)
That such representation is false
Corporate fraud
Management fraud
Fraud, theft, and embezzlement (penggelapan)
Fraud Auditing, Forensic Auditing, and Financial Auditing
Fraud Auditor, Forensic Accountants, Financial Auditors


Fraud is possible even in accounting in which control are

The visible part of transaction fraud may involve a small
amount of money, but the invisible portion can be
Red Flags of fraud are discernible (terlihat) if one looks
long enough and deep enough.
Fraud perpetrators (pelaku kejahatan) can come from any
level of management or society.
Why is fraud committed

Fraud Triangle


Opportunity Rationalization
Occupational Fraud And Abuse

The use of ones occupation for personal enrichment through the deliberate
(dengan sengaja) misuse or misapplication of the employing organization
resources or assets. (Wells, T. Joseph, 2011)

I Asset Misapropriation
II Corruption
III Fraudulent Statement

Misappropriations of Assets

- Larceny (pencurian)
- Skimming (unrecorded transaction; sales or receivable)
- Fraudulent Disbursement

Inventory and All Other Assets;

- Misuse
- Larceny

An act done with an intent to give some advantage inconsistent with official
duty and the rights of others. The act of an official or fiduciary person who
unlawfully and wrongfully uses his station or character to procure some
benefit for himself or for another person, contrary to duty and the right of
others. ( Henry Campbell Black,1979, Blacks Law Dictionary, 5th ed.)

- bribery (suap, Sogok)

- economic extortion (Pemerasan, permintaan harga terlalu tinggi)
- illegal gratuities (pemberian kompensasi tanpa alasan; missal free
international vacation he and his family)
- Conflicts of interest. (Purchases Schemes; sales schemes; other)
Fraudulent Statements

Fraudulent Financial Statement

- To conceal true business performance, Overstate or understate
- To Preserve Personal status/control. Performance is bad, may lead
- To maintain personal income/wealth from salary, bonus, stock, stock
Fraudulent Non Financial Statement;
- Employment Credentials (surat Kuasa)
- internal document
- external Document