Fraud Control Essay

Fraud case in workplace and control strategy:

Fraud can be defined as any form of deception purposely done to have unjustified personal gains. Fraud can be classified depending on where it was committed and who is involved. It is usually considered a criminal case and punishable by law although it depends on the country’s policies and regulations. Fraud is common in almost all sectors of the economy including; banking, procurement, recruitment, election, institutions, justice systems etc. This may be in form of forgery of signatures and documents, embezzlement of resources under once responsibilities, false billing etc. This is a common practice in many workplaces where individuals are trusted with running of day to day activities and it can be through writing, phone or internet.

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 In any city or town set up, Local government are usually entrusted with responsibilities of providing basic services like water, sewerage disposal, garbage collection, parking bays, lighting licensing of business etc. Towns are classified depending on size of population and it can be either a under city, municipal or town council. The council is the administrative organ of the local government which manages the entire department that provided services in a town. The council employs people to help various departments in carrying daily activities. Parking department is a branch that is responsible to ensure there order in all areas designed for car parking and any vehicle which is to be parked is charge a fees. Park attendants are entrusted with collection of parking fees which forms part of revenue for the local government. This money is meant to finance development activities within the municipality and pay the people employed in the department. To ensure there is accountability for number of vehicle parked in a day, council designs some receipts book specifically for parking and once the driver pays for the service, a receipt is issued and usually displayed on the front windscreen of the vehicle such that any parking officer who supervises the activity can be able to identify those who bleach the council by laws and take the necessary measures.

Due to some personal greed and lack of trustworthiness, the common frauds that arise with this activity is that some of parking attendants tend to collude with vehicle drivers by exempting them from paying this fees and in return they are given some handouts to benefit themselves thereby denying the council the revenue. Others parking attendants develop smart ways to cover up this syndicate and come up with counterfeit parking receipts books which resembles the original ones from the council such that the drivers and the supervisors cannot easily realize the difference. These fake receipts are issued especially when there is congestion in parking areas such that even the park supervisors cannot be able to closely check all the vehicles parked in their allocated areas. They issue them when such situations arise and all money collected using these fake receipts end up in their pockets. This is common in most of developing countries where most of tasks are manually done and human interface has the final decision on all activities. This result to shortfall in estimated revenue expected from the department and planned budget expectations are not achievable. Service delivery within such a town tends to be poor and order is longer observed. Worst hit are the other members within the same department who are not part of syndicate, salary delay arise since the council cannot be in a position to prepare them in time and work morale goes down

The control strategy which most appropriate for this kind of fraud is creating awareness to the employee that they are government custodians entrusted with this specific task of collecting and remitting money to the council. The work place ethics is the most essential since without trustworthy people there cannot be any success no matter how individuals are serious. Workplace involves several people contributing their efforts to make the objectives of an organization a success. If one or few individual fail to cooperate with the others, the final results will be efforts of honest people will be watered down by few who are dishonest.

Even with this workplace ethics is seen as the most effective strategy, there are those who are errant and they cannot exercise self control over themselves and they have to be monitored to effectively perform their duties. What the council needs to do is to change from this technology and apply information technology in this department. The system will be expensive when installing and cost of facilities required but in the long run benefits will outnumber the cost. The system will involve setting up stations at all entry and exit roads, at these station there will be installed surveillance camera. All vehicles will be installed with a barcode which will be read by surveillance camera, time and registration number of each vehicle will be recorded at every entry and exit points. The system will require a central control base where all daily activities from the stations will be recorded and stored.  Using the information from this system, it will be possible to know the number of vehicles that visits the town daily, number of hours spent within the town centre and appropriate parking fee depending on number of hour the vehicle was within the town centre. This system will require computer literate people who are able to develop programs which are able to encode information from the stations and form a data base of traffic flow to and out of the town. Information from the park attendants will also be feed into the computer system and find whether information is tallying. The computerized system should be managed by an independent body from the parking department so as to separate the two for efficient service delivery.

With installation of this system, fraud prone attendants using fake receipts will be identified easily since some vehicles will be booked in but their fee will not be reflected in system and necessary disciplinary action taken on them. The system can also have several surveillance camera set up within the town parking sites and movement of vehicle can observed during the official working hours when park attendants are on site. This will put them on alert to account for vehicle movement at their section and since they are aware of the operations of information technology section shoddy deals will be minimize and the council will be in a position to receive the money collected from the parking.

The set up of local government is usually meant to generate revenue from the activities carried in a town. A budgetary allocation is prepared for each year showing the expected revenue and expenditure for each council. From the budget, departments within the council come up with ways of generating revenue to meet budget needs. Targets are then set depending on available resources which are to be achieved for smooth running of the council. Each activity has to be properly accounted for so as to avoid budget deficits. When a deficit arises the council has to evaluate their expectations and look for possible causes. For a situation like this, before the expected revenue can be reached, number of parks and their holding capacity is estimated and this information provide a guide  when setting up of expected revenue. This forms the basis for evaluation such that unless forces beyond human control arise, other causes of deficits can be identified and possible solutions can be found.

 This control strategy discuss above is effective since it has been used in other developed countries and has proved workable. The cost of installing the system may seem to be high but since this is a long term activity its cost can be spread over the years. The amount of revenue which these park attendants denies the council can be big since the system has no means of control and checks. Therefore, the council has to employ a method which will counter all the sources of loopholes in the current system and reduce human interaction.

Also as most of organizations currently are applying information technology, computerizing the system can be right move towards development. This system should also be tamperproof such that once a vehicle is booked in the system; there is no room for human manipulation. This system can result in rise in revenue collected from parking fee and budget expectations can be achieved. The culture of fraud will also be reduced and with time can come to end. Workers equality in the department will also be achieved whereby all workers in the same job group are benefiting equally as opposed to some workers getting more than others.


Red Cohen, Frauds, Spies, and Lies -ASP Press, (2006):

Ellen S. Podgor, Criminal Fraud, (1999) Vol. 48, No. 4 American Law Review