Jeremy Clopton, CFE, CPA, ACDA
Managing Consultant, Forensics and Valuation Services, BKD, LLP
With “big data” comes the desire to see and better understand it. As investigators, that is one of our main objectives. While infographics and data posters are designed as art, there are other uses of data visualization as well. We need to understand the data in our cases so we can use it to detect fraud. I can think of many instances in my career where data visualization helped me, a colleague or a court better understand the data in an investigation.
Thinking back over my career, one case that demonstrates this concept stands out. While investigating a potential conflict of interest, we looked for vendors located near an employee's residence. Naturally, we decided the best approach would be to plot all of the vendor and employee addresses on a map. What we saw was quite interesting. None of the vendors were located near the employee on which we were focused. There was, however, another employee with a vendor very near. The employee and vendor were located more than 50 miles from the company address and the vendor was a casino. A new investigation quickly followed. Data visualization helped identify this previously unknown relationship and uncover a multi-year fraud scheme.
While this is only one example of using data visualization to detect fraud, there are many other applications of the same concept. Simple distribution charts showing checks issued by day of week or time of day identify checks issued outside of normal business hours. Trend analyses of vendor payments indicate unusual patterns of activity, such as kickbacks. Network maps show relationships between various parties (remember the pictures on a bulletin board connected by yarn in the cop shows?). The use of data visualization in investigations is limited only by available data and your imagination.
Speaking of imagination, I am a Certified Public Accountant (CPA). As such, imaginative is not the first word many use to describe me. People generally shy away from describing accountants as creative. That simply means I tend to look at what others are doing in the world of data visualization to find new ideas. And I would encourage you to do the same. Read reports, especially the exhibits. Check out websites about data visualization (I like flowingdata.com). By exploring what others are doing you will be better equipped to incorporate data visualization into your next investigation. Who knows, maybe the visualization used to break open your next big case will also end up as a work of art in your office.