What are Cashless Frauds?
One may have heard of a number of ways in which fraud is committed and how it hits the books of accounts of a company, at times seriously affecting the profit. But in some of the most well planned frauds, it has been seen that the books of accounts are left untouched and unscathed. This happens when there is a nexus between the supplier or the debtor and the related department employees. It is easy to show preference to a specific supplier by favoring him with priority orders at prices that are different from those which are quoted by other suppliers. This is one way of usurping the price difference, conveniently putting other suppliers virtually out of the supply and logistics chain.
Pretty much the same is the case with preferential debtors who are issued credit notes at special request so that part of their outstanding balances gets written off as faulty shipments or similar fabricated things. The credit notes and supplier bills are quickly converted to the nearest available currencies and the profit is shared and the company loses revenue.
Competitive pricing and fair market values are thrown out the window. Understandably, the auditors would be doing their job during the statutory audit of the company accounts, resulting in criminal proceedings too but at the end of it all the financial loss can never be compensated. Sooner or later, the company comes crumbling down with unprecedented problems. People may lose their jobs and may be asked to leave till things are back on track once again.
Fraud is defined as the misuse and the misappropriation of funds. This can be done by an individual or a group of individuals to achieve some specific selfish objectives. In more instances than one the fraudster gets caught and the law proceeds to take care of the formalities. There have been scores of cases in which a careful dressing up of the accounts of the company has fetched good incomes. Software companies do this with the idea to claim more tax rebates and reliefs from the Government. In turn the Governments treasury becomes empty and the gullible public is forced to pay extra taxes to make up the difference.
Everybody needs cash. But a fraudulent way of getting it is not right. By following a fraud route to more cash, the person endangers himself to be dealt with by the authorities. The person is at risk of severe penalties imposed by criminal laws that can ruin him and his family for life.
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