Target Uses Corporate Alliance Program to Connect Faster and More Genuinely

PARTNER PROFILE

Today the ability to connect with people at any time and from any place seems easier than ever. A tap of a finger makes the time it takes to reach someone almost instantaneous. However, reaching someone is only half the battle. The dreaded blocked-out day on an Outlook calendar, family obligations and the ding of a new email can sometimes get in the way of many attempted connections. But, the investigative team at Target is using partnerships like the ACFE’s Corporate Alliance programs to become connected to others in their industry and get the insight they need to stay ahead of the curve.

“To be successful in fighting fraud, you need to have broad knowledge and have a diverse network both inside and outside of your organization,” said Gregg Patyk, CFE, Senior Manager of Target’s Global & Information Security Investigations. “The Corporate Alliance helps us attain those goals. It enables us to connect faster and more genuinely with other companies that have similar goals and mindsets.”

Since joining the Corporate Alliance program in 2011, Patyk and his team have been able to build relationships with other member companies, especially during face-to-face seminars. At the ACFE Global Fraud Conference in San Antonio, Texas, last June, Target representatives sat down with other members and discussed specific initiatives regarding whistleblowing reporting within large companies.

“Since the conference, we’ve received assistance that we could not have received anywhere else,” Patyk said. “Likewise, we reciprocated and helped another member company resolve some of their issues. In both examples, both of our companies were able to expedite the resolutions of each matter because of partnerships and information sharing. Building partnerships with other companies enables Target to learn what other companies are doing and how they are successful with their anti-fraud programs.”

However, Patyk said that as in any relationship, it isn’t just about sharing the successes and passing along what has worked. There is also value in sharing challenges and having those tough discussions about things that didn’t work. “Being part of a group that shares information freely is conducive to learning. For example, not every program and method we have tried in the past has worked. I think it is equally important to share failures along with the success stories, so we can learn together.”

In addition to building connections with other corporations, Target uses data analytics to remain proactive and forecast potential threats. But Patyk said that there is another crucial step that goes along with that analysis. “I believe using analytics is a secondary step in being proactive. To truly be proactive, you need to be well-informed and have the right skills, knowledge and information. We connect with our internal business partners on a routine basis to have a better understanding of their businesses. By building these connections ahead of time, it really helps when there is an issue because we’ll have at least a cursory, if not better, understanding of that part of the business and be viewed as problem solvers versus adversaries. Building partnerships, staying informed and being well-trained are the first steps in being proactive.”

Read more about how Target is staying one step ahead of fraudsters in the full article on ACFE.com.

Kicking the Cane: Intra-familial financial exploitation of the vulnerable elderly

SPECIAL TO THE WEB

Annette Simmons-Brown, CFE

On Jan. 16, Martin Thibodeaux of Arnaudville, Louisiana, was arrested and booked on the charge of "financial exploitation of the elderly." Thibodeaux, according to a Jan. 20 KLFY article by Brittany Altom, had been listed as an authorized user of his 86-year-old grandmother's bank account for the purpose of caring for her. However, within six months, he made ATM withdrawals 12 times, cashed checks and made in-person direct cash withdrawals, and visited her bank 22 times to open her safety deposit box. According to the article, Thibodeaux accessed his grandmother's account 34 times and stole more than $36,000.

Financial crimes that target the elderly are increasing. According to The Wall Street Journal, "People 60 years and older made up 26% of all fraud complaints tracked by the Federal Trade Commission in 2012, the highest of any age group. In 2008, the level was just 10%, the lowest of any adult age group." (See, Financial Scammers Increasingly Target Elderly Americans, by E.S. Browning, Dec. 23, 2013.) Investigators estimate that only 10 percent of such frauds are reported, according to the article.

This underreporting of financial crimes against the elderly makes it difficult to get reliable statistics. It's possible that the aggregated financial impact on elderly victims — and society in general — will get much worse before a comprehensive national research and intervention response is entrenched.

Much of current popular and professional discussion on financial fraud that targets the elderly focuses on perpetrators outside victims' social nexus — shady investment promoters, faux home-improvement crooks, telemarketing scammers, identity thieves — who have built actual businesses and use the elderly as a conveniently vulnerable victim pool.

However, within this matrix there's another growing class of criminals: relatives of the elderly who steal from their own vulnerable family members under the guise of assisting them in their midnight years. And it's highly prevalent. According to a Consumer Report PDF, "Steven Peck, an elder-law attorney in Van Nuys, Calif., estimates that 75 percent of elder abuse is done by someone in the immediate family. …"

This two-part article will look at intra-familial elderly financial fraud, which is highly challenging to combat. In part one, we'll look at the growing incidences of this type of fraud. We'll use The Fraud Triangle to look at the similarities of these fraudsters to traditional occupational fraudsters. In part two, we'll look at actual criminal case summaries that demonstrate this category of fraud.

The two parts will outline these fraudsters' patterns of behavior and the difficulties of identifying, investigating and prosecuting crimes within families.

ELDERLY FINANCIAL FRAUD AND THE FRAUD TRIANGLE

Family members often have to assist their aging grandparents, parents, aunts and uncles as they become less able to take care of themselves. Frequently, these helpmates need access to their assets to assist effectively. They need to pay the elderly's bills, execute decisions on the disposition of real and personal property, manage their assets, and help make or implement medical decisions.

Frequently, helpmates are placed onto the elderly's financial accounts — and real property titles — as joint owners specifically so they can manage the elderly's financial matters both small and large. And very often, a helpmate is appointed as an attorney-in-fact through a power-of-attorney instrument that gives him or her specific responsibilities and capacities regarding the elderly's assets. At this point, a helpmate often is given direct and legal access to an elderly person's property and credit, and the ability to steal is remarkably amplified. The Fraud Triangle now comes into play.

Donald Cressey's Fraud Triangle teaches us that there are three interrelated elements that enable someone to commit fraud:

  • Perceived pressure to commit and conceal the dishonest act.
  • Perceived opportunity to commit the crime without being caught.
  • Some way to rationalize the fraud as not being consistent with one's values

(Excerpted and adapted from the 2014 ACFE Fraud Examiners Manual, 4.240, 4.247, copyright 2014.)

Though Cressey developed The Fraud Triangle within the context of occupational fraud — to represent the embezzler, the cash-register skimmer, the insurance scammer, the bid rigger — it also perfectly captures the framework of the crooked family member who now has access to the cookie jar containing the elderly's assets.

Want more? Read Annette's full article about elder fraud on Fraud-Magazine.com.

It's Better to Have Loved and Lost (Money) Than to Have Never Loved At All

GUEST BLOGGER

Courtney Pedersen
ACFE Communications Coordinator

When the poet Alfred, Lord Tennyson wrote his famous line, “‘Tis better to have loved and lost than never to have loved at all,” I’m sure the possibility of romance scams hadn't crossed his mind. Victims of romance scams can lose time, money and confidence. In 2011, the FBI’s Internet Crime Complaint Center (IC3) received 5,600 complaints from victims of so-called “romance scammers.” The victims reported collective losses of $50.4 million.

These scams involve con artists who work their way into your heart and eventually into your pocketbook by infiltrating chat rooms, dating sites and social networking sites. Here are a few examples of how these scammers work:

In 2012, Debbie Best met a handsome man, John, on an online dating site. According to his profile, he owned an antiques store in Florida. After getting closer John claimed that, while travelling to the UK and Nigeria, he had become financially stuck and unable to travel home. He asked her for money and called her daily, eventually telling her that he could not even afford to eat. She wired him two payments of $250, not realizing until after the money was sent that his fake name was known online and being used in other scams. She also received the phone bill for the calls John made to her which totaled $1,000.

Recently in Quebec, Canada, William Reid was a victim of an online Valentine’s Day scam. He was speaking online to a woman who called herself Jane. Jane was from Africa, and Reid wanted to fly her to his location so that they could live happily ever after. As Jane was travelling closer to Reid there were a series of unfortunate events that cost him more and more money. In the end he was stood up and out $10,000.

In another story that was featured on “Dr. Phil,” a widow named Norma fell in love with Richard on the online dating site ChristianMingle.com. After they met she soon began sending him money for cars, computers and even money to loan his friends. Richard, who supposedly lived in North Carolina at the time they began talking, created a story that he moved to Ghana to explain why the money was sent overseas. For two years Norma and Richard planned their future together, which even included adopting an orphan in Ghana. Norma eventually learned that photos of Richard were actually photos of another man named Bill in the U.S. that were stolen from Facebook. Over the course of three years Norma sent Richard a staggering $300,000.

With these examples I can’t help but wonder whether Alfred, Lord Tennyson should have put a disclaimer next to his famous line. If you feel that you or a loved one has been duped in an online dating scam visit IC3’s website and file a claim.