Poor controls and the risk to business
In 2005 while working for a large consumer goods company a
significant fraud activity was uncovered regarding theft of goods for resale at
significantly inflated rates to the victims of Hurricane Katrina in the Gulf
region.
The theft involved internal employees, outside contractors, coupled with a variety of system, and process shortfalls, which contributed greatly to the size and scope of the theft. Today I received word that one of those convicted of the crime has been released from federal prison. As I reflect on the last several years, the knowledge and exposure I gained while working with Federal authorities in decoding the mechanisms used to commit the crime, one thing stuck out like a sore thumb.
To spite the fact it took individuals to
commit and profit from the crime, these individuals were provided with a
significant advantage due to poor internal controls, lack of policy review, and
a general acceptance that doing more for less with multi tasked roles was good
for business. Everyone convicted of this crime got what he or she deserved.
However, when it comes to minimizing risk while maintaining an agile
organization nothing should be left to chance. ----- Michael T. Mantzke
