Fraudulent Documentation: Fraudsters’ Secret Weapon ... How to Disarm Them

"Fraudulent Documentation: Fraudsters’ Secret Weapon

... How to Disarm Them”May 29, 2013

Special Guest Presenter:Robert Baier, Handwriting Services Int’l

Copyright © 2013 FraudResourceNet™ LLC


About Peter Goldmann, MSc., CFE

President and Founder of White Collar Crime 101

Publisher of White-Collar Crime FighterDeveloper of FraudAware® Anti-Fraud Training

Monthly Columnist, The Fraud Examiner, ACFE Newsletter

Member of Editorial Advisory Board, ACFE Author of “Fraud in the Markets”

Explains how fraud fueled the financial crisis.


About Jim Kaplan, MSc, CIA, CFE

President and Founder of AuditNet®, the global resource for auditors

Auditor, Web Site Guru,

Internet for Auditors Pioneer

Recipient of the IIA’s 2007 Bradford Cadmus Memorial Award.

Author of “The Auditor’s Guide to Internet Resources” 2nd Edition


Robert Baier Introduction

Bob Baier is a certified handwriting expert and a certified forensic document examiner (CDE)

He has 3 Degrees -- AS, BS, MA. CDE, CHA

Bob is a certified NY State law enforcement instructor and trains in the areas of document examination, identity theft, bogus checks, statement analysis, the criminal mind and handwriting as well as overall handwriting analysis.

Mr. Baier has been on live radio nationally and has been on the Television Shows “Inside Edition” and “Law Talk TV”. In Sept 2005 he was featured in ESPN magazine for an analysis he did regarding an extreme sport athlete.


Introduction cont’d

Bob is the author of the book “Identity Theft – Prevention for the College Student.” This is considered by some to be “The finest and most complete book on the market today regarding Identity Theft and the easiest to read with its conversational style.” Cecile Moore N. Attleboro, MA. This book has been used to train law enforcement in at least four different states.

Bob’s new book, “GPS for Success (Goals and Proven Strategies)” is co-authored with Steven Covey author of the book “7 Habits of Highly Effective People”, Dr. John Gray author of the book “Men are from Mars Women are from Venus” and Les Brown nationally known speaker and author.

Bob is one of only 3 people in the country who can do training on both Statement Analysis and Handwriting Analysis.


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Disclaimers

6

The views expressed by the presenters do not necessarily represent the views, positions, or opinions of FraudResourceNet LLC (FRN) or the presenters’ respective organizations. These materials, and the oral presentation accompanying them, are for educational purposes only and do not constitute accounting or legal advice or create an accountant-client relationship.

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Today’s Agenda

Introduction: Fraud Statistics: A Growing Fraud Threat

Auditing for Fraud: Standards & Essentials

Writing Habits

Bogus Checks

Numbers

Request Writing DDI

Anonymous/Disguised Writing Your Questions Conclusion


Fraud: The Big Picture

According to major accounting firms, professional fraud examiners and law enforcement:

Fraud jumps significantly during tough economic times

Business losses due to fraud increased 20% in last 12 months, from $1.4 million to $1.7 million per billion dollars of sales. (Kroll 2010/2011 Global Fraud Report)

Average cost to for each incident of fraud is $160,000 (ACFE) Of Financial Statement fraud: $2 million

Approx. 60% of corporate fraud committed by insiders (PwC)

Approx. 50% of employees who commit fraud have been with their employers for over 5 years (ACFE)


The Auditor’s Role

IPPF Standard 1210.A3 Internal auditors must have sufficient knowledge of…available technology based audit techniques to perform their assigned work


Deception and Writing


Common Documents Subject to Fraud, Forgery, Crime etc.

Wills, Deeds, Company Contracts, Checks, Mortgages, Financial Statements (car dealerships), Vendor Disputes, Receipts, Office Memos, Notes, Writings on Bathroom Walls, Inside Company Trucks and more.


Document Examination

Writing is a learned skill

We learn through repetition (until a habit)

Every mature writer has his own set of unique handwriting habits

These are unconscious habits

Then compare the writing habits of the two writers

Natural variation in writing (range)


Polling Question 1

Writing is a learned skillA. True

B. False

C.


Bogus Checks

You can examine 7 things in only 10 seconds concerning the check itself -- to determine if it is real.

We are not talking about looking at any writing on the check.

Where exactly on the signature line do yousign your name.

No such thing as a signature line on a check.


Check Signature Line


Perforation

All “real” personal checks have a perforation on one of the 4 sides.

Only exceptions are some payroll checks and government checks.


Microprinting


Front of Check


Back of the Check


Numbers

Our numerals are based on the Arabic numerals.

Formation of numerals is part of penmanship training

Numbers are rarely disguised

Writers don’t realize that numbers are identifiable


Numbers

Types of fraud cases involving numbers:

Raising the amount of a negotiable instrument

Doctoring the books in embezzlement cases

Forged or counterfeit checks.

Identification of a writer by his numbers


Numbers

Raising the amount of a negotiable instrument


Polling Question 2

The numbers we use are based on ________

NumeralsA. Latin

B. Arabic

C. American

D. Roman

E.


Embezzlement


Altered Documents


Check Washing

Some chemicals are used on checks to erase all of the ink. “Washing”

Washed checks have a slimy feel.

Side lighting will show differences in “sheen”

Use “Uni ball Signo 207 Pen”


Identifying a Writer by Numbers

Because people are creatures of habit, they can be identified by the way that they separate their numbers when writing dates. Slashes, Dashes, Spacing

Number formations can be identified


Anonymous/Disguised Writing

70% of Anonymous writings in the workplace are female

Worst language and most offensive drawings are also females

25% of Anonymous writings in the workplace are done by the person reporting the incident

#1 change is Slant then Capital letters

Cursive to Printing or vice versa

Start from the back and work forward


Proportions


Request Writing

Dictate, Duplicate and Isolate

Create Words for Combos and Connect.


Fredie Forger


Polling Question 3

______ percent of anonymous writing in the workplace is by females

A. 50%

B. 25%

C. 70%

D. None of the above

E.


Is this a photocopy of an original receipt?


Handwriting Analysis

Brief history

Handwriting is brain writing

Handwriting is a science

Graphology/Handwriting Analysis

Forensic document examiner (testifies in court)


Uses of Handwriting

Forgery Detection

Law Enforcement (profiling depts)

Job Placement (5000 US)

Jury Selection

Tenant Selection


Uses of Handwriting (cont’d)

Self Improvement

Grapho-Therapy

Relationship Compatibility

Help Children

Disease Detection


Europeans

European Countries use handwriting analysis extensively

US Customs Agent


Taking Statements

If you can “weed out” fraud suspects you will save time. “Speed Read” your suspects.

Change your statement sheet. Same heading with directions but where they write should be a blank paper with no lines.

Office personnel help out


Polling Question 4

Handwriting analysis is useful for which of the following…

A. Law Enforcement (profiling depts)

B. Job Placement (5000 US)

C. Jury Selection

D. All of the above

E.


Statement Analysis Training

Personal Vocabulary

25-50-25 story

Try to Tell the Truth

Writing Changes When Lying


The Criminal Mind


The Criminal Mind

No Margins – live with no boundaries

X’s at baseline-thinking about death

Smiley face – deception, do not trust

Covering or scratching things out – deceit

If obscure name-do not trust


Criminal Mind


Criminal Handwriting Traits


Polling Question 5

Covering up or scratching out portions of written documents is often a sign of…

A. Correction of honest errors

B. Deceit

C. Professional editing

D. None of the above

E.


Covered a Lot

Handwriting Habits, Bogus Checks, Numbers, Request Writing, Anonymous, Disguised Writing, Hate Crimes, Tremor, Criminal Mind, Identity Theft etc.

Diff. Between Doc. Exam and Handwriting Analysis


Resources

Book – Forensic Handwriting Examination

www.reedwrite.com/publication.html

808 528-1112 (Hawaii)

Taking Statements – Miranda Fitchette

www.forgeryexaminer.com

www.handwritinguniversity.com


Questions?

Any Questions?Don’t be Shy!


Thank You!

Website: http://www.fraudresourcenet.com

Jim KaplanFraudResourceNet™

800-385-1625 [email protected]

Peter GoldmannFraudResourceNet™

[email protected]


Thank You

Bob Baier

Forensic Document Examiner

www.expertdocumentexaminerweb.com

1-888-460-3828


Coming Up Next Month

"An Expert’s Advice on Establishing an Organization Wide Fraud Policy” on June 5

"How to Catch Expense Reimbursement (T & E) Cheaters Using Data Analysis"Effective Anti-Fraud Controls, on June 18

"Ethics for Auditors: Understanding Current Issu es in Financial Integrity” on June 26 http://www.fraudresourcenet.com


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Fraudulent Documentation: Fraudsters’ Secret Weapon ... How to Disarm Them