BUS272 TB

518 Additional Cases
department she had many opportunities to observe and learn
the company’s audit procedures. Julie viewed the work in
accounts payable as repetitive and tedious, and she was aware
that she did not have the discretion or authority to make her
own decisions. Everything at this company was done VERY
strictly by the book. Despite these limitations, however, Julie
enjoyed her job and the company of her co-workers and
colleagues, and she felt that her employer treated her well.
In early 2008, Julie made a lateral move to the department
that administered corporate commercial accounts. Large
corporations bought insurance policies as protection from
lawsuits and were required to pay a flat rate per term regardless
of the number of claims made against them. Julie oversaw
more than 500 corporate policies. When one of the corporate
clients experienced a loss, Julie would process the claims for
legal fees, compensation, and related incidentals. Examples of
common losses included compensation paid out due to slips
and falls, safety violations, and other lawsuits. Julie processed
an average of 13 to 15 claims per week. When the compensation
was less than $10 000, Julie simply created, signed, and
issued the cheque herself. Claims over $10 000 required a
second signature, but she could ask anybody in the office to
sign, so this was rarely a problem.
After several months on the job, Julie noticed that the corporate
clients did not receive reports about claims made against
their accounts. Since corporate clients paid a flat fee regardless
of how many cases were processed, the corporate clients had
little incentive to actively monitor claims activities.
Although she enjoyed her job and her co-workers, Julie, a
single mother with a toddler, struggled to make ends meet.
She earned $24 000 per year. Her expenses had exceeded her
income ever since her son was born. Daycare was so expensive,
but she had no choice but to use it if she was planning to work
full-time. Worse, the small savings account that she inherited
upon her mother’s death a few years ago was nearly empty.
She had only a high school education, and she had been very
lucky to land the job at the insurance company in the first
place. Her options for increasing her income were limited,
and her son’s father had never been involved in parenting or
provided any type of financial support. In fact, Julie doubted
she would be able to locate him, even if she tried. As she
worried and considered her limited alternatives, Julie thought
about her work tasks again, remembered that her company’s
internal audit process examined corporate commercial accounts
only every six years, and came up with an idea for some relief.
Julie’s son was enrolled in a private, at-home, daycare
service. She was friends with Marie, the person who operated
the home daycare, and they had shared a lot of laughs
together. Julie usually paid for daycare on a bi-weekly basis
using a personal cheque. Until the day she didn’t. Three
weeks after her initial flash of “inspiration,” a different kind
of cheque was handed over to Marie, one with the insurance
company’s name featured as payer instead of Julie’s name.
“That’s weird,” commented Marie, “what is up with this?”
“Oh, I was embarrassed to tell you,” said Julie, looking down
at her feet. “I’m having some financial difficulties and my
employer has decided to help me out, so the cheques for
daycare will come from the company from now on.” Although
this sounded a little strange to Marie, she figured that the
issue was personal, shrugged, and accepted Julie’s cheque.
Julie left the daycare feeling euphoric. Her idea had actually
worked! Three weeks previously, she had created a “loss”
in the system with Marie’s name ascribed to it. Julie selected
one of the very large corporate commercial accounts against
which to submit the claim, a company that was seldom, if ever,
reviewed. She was well aware of the most common types of
losses experienced, and so it was not difficult to come up with
a scenario and dollar value that would not attract attention.
She simply entered Marie’s name as the claimant, approved the
claim, and in due course a cheque was issued.
The plan had worked so well the first time that Julie
executed it again. And again. And again. A little over eight
months passed and, in that time, she created eight different
claims under Marie’s name. She added it up one day and
realized that she had netted $12 000 from her “side activities.”
Julie reflected on how easy it had all been. She worried
that she would be tempted to do it over and over again,
and not just for daycare expenses. This was not the person
she wanted to be. She decided that the only solution was to
remove herself from temptation. She asked for, and received,
a transfer to another department.
While Julie was celebrating her transfer and the fact that
she would no longer be tempted, a problem emerged. The
cheque for the last claim she had invented came back to her,
because she had not filled in a field that coded the claim for
the accounting system. Normally she could have fixed the
oversight in a few seconds, but because she had been transferred,
she no longer had access to the system. The person
who replaced Julie asked her for a copy of the paperwork to
back up the claim before filling in the missing information.
Julie was unable to provide any. Not long after this incident,
Julie arrived at work one morning to find herself called into
a private room. Management informed her that they knew
about the fraudulent claims, fired her, and advised her to get
a lawyer. One month later, a police officer came to her home,
and she was formally charged with fraud over $5000.
Now here she was, in court, being sentenced. She feared
that her little boy would not understand why she would not
return home that night. She had not told anybody about what
was happening, in denial that she might actually go to jail.
She felt numb all over and just prayed that her new boyfriend
would be willing to take care of her son until she was released.