FRAUD DETECTION AND CONTROL

CHAPTER ONE

INTRODUCTION

1.1  BACKGROUND OF THE STUDY

In recent times fraud in ministries dominates front page of our Newspapers, radio announcements and television announcements. This fact is indisputable in the minds of the readers, listeners and observers. These fraud stories should be on a matter of greater concern to a patriot worthy of the name. The deeper study and increased analytical approach to ghost workers had led to an over growing realization of the frauds and control in the ministries and autonomous departments and the influence on the success or other wish of government of Nigeria.

According to the research made, it is the impact fraud has on government revenue, big organization, banks, ministries etc. that led into writing this topic.

Furthermore, the ghost workers exercise by the Enugu state government in the ministries and autonomous department in 1995 and the introduction of various control that inspired to carryout this survey and investigation on how fraud can be controlled to at least be reduced to the lowest bares minimum.

According to the oxford advance learners Dictionary of current English, the word fraud simple means criminal deception.

Perhaps the meaning and explanation which consider more is the definition offered in Hamlyn Encyclopedia world dictionary. According to this great master dictionary, the word fraud means deceits, trickery, sharp practice or breach of confidence, by which it stands to gain more some unfair or dishonest advantages over others.

In other words on these definition put forward above, it means that the act exhibited by some one which is pursed towards gaining under and non – meritorious credits at the detriment of the right beneficiary construct an act of fraud is never committed, unless the intention of the perpetrator was present the time the execution of the dubious plan. Therefore any alleged fraud which does not meet this test must be construed and interested as aiding and betting fraud.

Another definition of fraud by the college dictionary of the Random house if simply “a deceit, trackery or breach of confidence use by one person to gain unfair and dishonest advantage over others.

This two definition rather appropriate and adequate for this project because they contain the main element of fraud, which include the following:

1.          There must be decent, trickery or breach of confidence.

2.          There must be unfair and dishonest advantage based on the concept of one man’s loss is another man’s gain.

1.2  STATEMENT OF THE PROBLEM

The recently reported waves of fraud in the ministries is to say the least, very unfortunate frauds, no doubt are being perpetuated in various sub – sectors of the economy but those committed in government organization going by previous and recent reports, are most disconcerting.

A situation as we are experiencing now where incessant care of frauds of the ministries payroll are being reported which could not immediately check erode our future economy. Fraud has continued to cause untold hardship to our people collectively and individually. To capture all fraud has significantly contributed to what is happening in the ministries and departments lapses in the government of Enugu state.

Fraud which may be discovered in payroll department include:

i.            Salary defalcation

ii.          Over easting of salary sheet

iii.        Inflation of figure

iv.        Dummy names or non existence expenses.

v.          Preparing of supplementary voucher.

In effect of this problems posed by fraud in almost every payroll system in Nigerian organization that gave the researcher the impetus to go into research to investigate and find out the rational behind these frauds in payroll. How they are detected checked and control.

In recognition of the above facts, the type of frauds committed and other possible effects of frauds in the payroll system.

The researcher also hopes to make useful recommendations and suggestions that will help completely to a large extent eliminate fraud in ministries payroll.

1.3  OBJECTIVE OF THE RESEARCH

Fraud in payroll system in most Nigeria organization is comparatively high and this has disturbed the growth and development of certain organization. The main aim of the study is to ascertain the reasons for fraud in payroll, how they are detected, checked and controlled.

1.          To find out the different types of frauds committed in the payroll.

2.          To find out causes of fraud in the payroll system

3.          To find out the step that can be taken to eliminate fraud in the payroll.

4.          To find out the category of workers committing fraud in the payroll system.

5.          To make recommendations based on the finding of the study

6.          To determine the nature and scope of these fraud in payrolls i.e. whether they are fundamental or material.

7.          Finally to suggest solution to problems and make recommendation for future prospect.

1.4  RESEARCH QUESTIONS

1.  What are the types of fraud committed in the payroll department?

2.  What are the causes of fraud in the payroll system?

3.  What are the steps to be taken to eliminate fraud in the payroll department?

4.  Does fraud exist in the payroll department?

5.  Does fraud have any adverse effect on the progress of an organization and country’s economy?

6.  Does poor motivation of employees in ministries cause fraud?