By Fraud Expert, Ed Martin

Preparation for hiring a PI to locate a person or conduct surveillance.

1. Determine who, what, when, why and your budget

2. Seek a cost estimate.

3. Secure a written contract from the PI

4. Your attorney in the matter should hire the PI.

1. An opportunity to expand your fraud investigation business by allowing us to take care of your back office services, such as, the input of bank, brokerage and credit card data.

2. Our fraud support services are better, cheaper, and faster than spreadsheet input.

3. We use high speed scanners, Optical Character Recognition, templates, sophisticated software and all done with the skill, knowledge, education, experienced and training that was gained as a Special Agent working financial crime cases.

4. We leverage proprietary database technology developed over the past seven years and proven through investigations.

by Ed Martin, CFE, Tax Fraud Expert

The Internal Revenue Service sets the bar high for individuals to meet the Innocent Spouse guidelines.

Important: Form 8857 Summary of Instructions:

The IRS says must complete your paper work, Form 8857, attachments, and exhibits “as soon as you become aware of a tax liability for which you believe only your spouse should be held responsible.” You must be brave in this process because the IRS will contact your spouse and inform him/her of the filing to allow him/her to participate and will advise him/her of their determination.

by Fraud Expert, Ed Martin

With continuous construction in Austin, Texas you may be hired to investigate the misappropriation of construction funds by their contractor. The investigator will ask himself / herself, where do I start? The following will act as a checklist of things to do if faced with this type of investigation.

Meet with the Client:
Remember to take care of yourself by securing a signed contract with the client defining the scope of your investigation and secure a retainer. Thoroughly interview the client and any secretary or bookkeeper about what they suspect and why.

Records are everything:
Obtain the contract between the partners and the contractor to determine the terms and conditions, including the required periodic financial reporting

by Jason Slick, President, Cynic Inc.

In today’s global economy the importance of data organization and classification has become the cornerstone on which a financial investigation relies.Everything from converting to digital data to searching information for classification has become an arduous task as fraud cases have become more and more complicated. To address this increase in data complexity, a few standardizations of technique and technology can make a huge difference in the number of hours needed to take a fraud investigation from start to finish. In this article I will discuss the various techniques and processes for building financial fraud cases using computer technology. From data entry and conversion to advanced search algorithms that aid in classification, managing a financial fraud case has never been easier, if you know the right techniques and tools to use.

By Fraud Expert, Ed Martin

From www.irs.gov

I. The Voluntary Nature of the Federal Income Tax System

A. Contention: The filing of a tax return is voluntary

B. Contention: Payment of tax is voluntary

C. Contention: The IRS must prepare federal tax returns for a person who fails to file

by Fraud Expert, Ed Martin

When do people embezzle or abuse the company? Generally, three things have to be present before someone commits fraud or embezzles: need, opportunity, and rationalization. This is known as the “triangle of fraud.”

Need – Direct need is stealing to fund cash needs and is often driven by an addiction – drugs, alcohol, gambling, or an extramarital affair.  Therefore, the next time someone brags about an affair, a warning flags should go up if the handle your company funds.

by  Fraud Expert, Ed Martin

If you are unfortunate enough to have IRS Criminal Investigation (CI) target you and execute a search warrant on your residence, cars, and small business here is what to expect. An IRS Special Agent with information sufficient to establish probable cause for a search warrant has filed an affidavit with a US Magistrate and obtains a search warrant.

The affidavit will be “sealed” to prevent access to the contents.  The agent (armed with guns, bullet proof vests and badges)

by Fraud Expert, Ed Martin

6 Tips to minimize fraud risk:

1. Protect your money:  Have company bank statements sent to the home of the business owner, not directly to the office, to demonstrate that you are paying attention to the company finances.
2. Review the statement and ask questions about several items on the statements to ensure the employee knows you are watching, which will reduce the opportunity and increase the risk of being caught.  Require monthly reconciliations and review them monthly looking for checks that cleared and those outstanding. 
3. Have a third party, perhaps an accountant, or forensic accountant review internal controls, segregation of duties, and suggest changes.