"Energy is Opportunity" the Foundation for Saudi Aramco’s Commitment to Fighting Fraud


ACFE Staff

For the past 80 years, Saudi Aramco has worked to establish itself as a leader in energy, and oil and gas production. Most recently, the company has also taken steps to lead fraud detection and prevention efforts in the Middle East. More than just a company tagline, “energy is opportunity” is only a stepping stone to the larger principles of integrity, citizenship and ethics.

"While 'energy is opportunity' to us at Saudi Aramco, the company can only capitalize on its opportunities when the basic underlying business processes are all in place and functioning effectively," said Waheed Alkahtani, CFE and CCEP-I, head of the Internal Auditing Advisory Services Group at Saudi Aramco. "The culture has to be one that values and upholds core principles of high integrity, while each employee demonstrates good corporate citizenship. In this regard, being a leader in both fraud detection and also prevention, such as through greater ethics and fraud awareness, surely contributes to the success of Saudi Aramco."

Headquartered in Dhahran, Saudi Arabia, and employing more than 65,000 workers worldwide, Saudi Aramco is one of the largest oil companies in the world. The oil and gas producer leads the industry in production, operational reliability and technical advances. It is currently the world’s largest crude oil exporter, producing roughly one in every eight barrels of the world’s oil supply. With this great responsibility of service, comes an even greater responsibility of ensuring the businesses’ processes and values stay true to the vision of creating opportunity through integrity.

According to Alkahtani, Saudi Aramco has had a history of valued partnership with the ACFE. It established an ACFE Saudi Arabia Chapter in 1997, and most recently joined the Corporate Alliance Program. "When we realized the many benefits of the program, joining the Corporate Alliance became a natural transition for us," he said. "It allows our sizable complement of investigative professionals to have direct access into ACFE’s many resources."

Saudi Aramco decided to join the Corporate Alliance during a difficult time for oil prices, a bold step that could have been viewed risky. But according to Alkahtani, it was actually more cost-effective for Saudi Aramco to administer a group membership as opposed to individual memberships. “At a time of cost-containment and focus on efficiency due to budgetary tightening across the oil industry, the Corporate Alliance offered a positive solution for us, while maintaining valued access to ACFE for our professionals," he said. "We are also able to use ACFE research studies and reports to benchmark our anti-fraud efforts against best-in-class practices. The Corporate Alliance provides cost-effective tools that support our anti-fraud efforts, while keeping us abreast of the latest industry developments and training opportunities."

Affiliates are located in China, Japan, India, the Netherlands, the Republic of Korea, Singapore, the U.K. and the U.S. Like many large corporations, even though the company is headquartered in a central location, its reach is global. Saudi Aramco has designated organizations to effectively manage and investigate suspected fraud cases. “Fraud case profiles tend to be surprisingly similar across global locations,” said Alkahtani. “Saudi Aramco uses a consistent fraud investigation and reporting process to ensure that the General Auditor can reliably provide a comprehensive view to the Board Audit Committee. The two key departments that are involved in investigations of suspected fraud: Special Audits (SAD) and Corporate Security Services (CSSD). Their reports are issued to two corporate executive committees, such that the company acts fairly, ethically and responsibly.”

Perhaps a benefit of joining the ACFE’s Corporate Alliance that may seem obvious, yet understated, is something that Alkahtani is most enthusiastic about: he, and Saudi Aramco, are not alone. "We are all in this fight together! The fact is, no organization operates alone, and we must rely on each other’s efforts to stamp out fraud and corruption," he said. "No government can do it alone either. Regulatory pronouncements must be complemented by corporate policies that work hand-in-hand to enhance transparency and promote integrity. The company has taken a proactive stance in this matter to lead by example. By doing so, we hope that the benefits of a higher integrity business culture will accrue to every citizen and to Saudi Aramco itself."

To find out more about the ACFE's Corporate Alliance Program and hear more about how Saudi Aramco is committed to preventing and detecting fraud, visit ACFE.com.

Fighting Fraud on a Global Scale Starts With Clear Values


Fighting fraud on a global scale may seem like a tall task. But, according to Istvan Deak, it all begins with values. “It all starts with clear values that are used in practice every day,” said Deak, the director and head of global compliance for Maersk Oil. The Maersk Group is made up of five core businesses which include Maersk Line (the world’s largest container shipping company), APM Terminals, Maersk Oil, Maersk Drilling and APM Shipping Services. Maersk Group is a global conglomerate with some 89,000 employees and activities in more than 130 countries.

Maersk attests to the same five core values created more than 100 years ago when a father and son team founded the company in Svendborg, Denmark. Those values still listed on the company’s website today include constant care, humbleness, uprightness, your employees and your name.

But even as Maersk has changed over the years, its commitment to those values has remained more than just a list on their website; it is a part of their company culture. “Maersk is ready to promote its values. The company has transformed in the last decades from being a Danish family-owned company to be a truly global diversified multinational conglomerate,” Deak said. “At the same time, the values are the same.”

Deak mentioned that Denmark’s No.1 spot (for the past four years) on Transparency International’s (TI) Corruptions Perceptions Index has bipolar implications. While it is headquartered in the least corrupt country according to TI, it still faces the same fraud risks that all global companies face. “Maersk has a global reach, so that also means that all types of fraud are relevant. It is an extra layer of challenge to consider serious fraud and corruption risk when setting up processes in a predominantly non-corrupt environment,” Deak said.

Two ways they work to mitigate fraud risk is through their Fraud Risk Services (FRS) team and a fraud risk community. The FRS was created last year by Maersk Group’s Internal Audit department and works to help management with their anti-fraud efforts. The team is made up of five core members: two full-time focused FRS employees and three employees that provide part-time advisory help.

According to Deak, the fraud risk community includes two to three people from each business unit. “Our aim is to extend our team with members knowledgeable about the business unit processes and environment,” Deak said. “We provide guidance to them as to how to manage investigations and how to raise awareness.”

Because Maersk has offices all over the world, the way in which teams handle cases is somewhat customized. “Some [of the business units] have dedicated teams to deal with investigations and prefer to have a full global overview for their respective cases managed out of the headquarters. Some rely more on our FRS team. And in some areas, such as China, we developed local teams to address area-specific issues when language and culture knowledge is necessary,” Deak said.

Another way Deak and Maersk as a company work to prevent and deter fraud is through helping FRS team members earn their Certified Fraud Examiner credential. According to Deak, the best way for them to do this is by partnering with the ACFE through the Corporate Alliance program. “All FRS members are CFEs, and we believe that the best available source of education is provided by the ACFE. We also value significantly the opportunity to discuss common issues with Corporate Alliance members in a confidential environment. The alliance provides us a cost-efficient solution for that as well.”

Deak said that they have also started offering the CFE certification to their fraud risk community members to reduce reliance on third-party investigators. They are taking advantage of ACFE articles and publications to raise awareness, and plan to use the ACFE’s videos of convicted fraudster in sessions with the fraud risk community members as part of their training.

Deak thinks that the partnership will only help their efforts now and in the future to create the awareness they have worked so hard to instill within Maersk. “Access to education, networking, awareness materials and the opportunity to discuss complex issues with peers will enhance our ability to fight fraud,” Deak said. “Also, slow economy decreases our budget so we need to find creative solutions, such as developing mitigation plans together. I believe this fight can only be successful if we align our efforts. Fraud is a global issue, and we have to fight it globally together.”

Read more about the Corporate Alliance program at ACFE.com/Corporate.

Strategic Thinking, Alignment and Partnership Keys to Fighting Student Financial Aid Fraud


Apollo Education Group, Inc.
ACFE Corporate Alliance Member

A major milestone for many adults of all ages is the decision to attain higher education. A college degree can be an important piece of the puzzle for those pursuing careers in any field, and federal financial aid helps many students achieve their goals.

However, federal student aid (FSA) fraud lurks in the background, threatening to steal deserving students’ futures. FSA programs can be abused in various ways. For example, individuals might apply under false pretenses or fabricate documents in order to be awarded funds or amounts they are unqualified to receive. Or students may squander their financial aid on luxury items unrelated to learning. Organized FSA fraud schemes also plague the industry — ringleaders steal identities or recruit straw students in order to gain unlawful access to FSA funds. However, organizations like the Apollo Education Group are taking concrete steps to thwart this type of fraud and abuse.

“We are susceptible to all of the same types of fraud any organization of our size and global footprint would be,” says Jim Berg, Vice President and Chief Ethics and Compliance Officer at Apollo Education Group. “We also see frauds more specific to our industry, such as federal student aid programs, or ‘financial aid.’ Our brand recognition makes us a very popular target for fraudsters. Fortunately, we have developed an industry leading program to combat such organized, external attacks.”

It’s with this forward-thinking approach to combating fraud that Apollo Education Group decided to join forces with the ACFE’s Corporate Alliance Program. One of the world’s largest private education providers, Apollo Education Group offers innovative and distinctive educational programs and services, online and on campus, at all levels. Apollo’s subsidiaries include University of Phoenix, College for Financial Planning, Western International University and several learning institutions outside the U.S.

“We have been strongly linked to the ACFE for many, many years now and count a multitude CFEs within our employee ranks,” continues Agins. “We know fraud is going to happen and we understand that we must be prepared if we are going to combat it successfully. Apollo Education Group’s commitment to ethics and integrity is unwavering and we have put a great deal of time, effort and strategic thinking into creating a best-in-class ethics and compliance program. We see joining the Corporate Alliance as consistent with this overall effort.”

According to Agins, Apollo Education Group regularly trains and shares best practices with other colleges and universities, because when fraud happens in this area, it truly hurts “us all.” Colleges, universities, students, prospective students, parents and taxpayers all feel the effects of FSA fraud. “This federal program was designed and developed to help people realize their educational dreams and goals,” says Agins. “So, when it’s attacked and funds are siphoned off to line the pockets of fraudsters, this takes away from the resources of legitimate students, institutions and the taxpayer.”

However, Apollo Education Group is committed to putting these fraudsters out of business. “Even with the valiant efforts of the ACFE and others, the future for the fraudster will only gain strength if we’re fractured, unaligned and don’t take these matters seriously,” continues Agins. “Fraudsters are learning to leverage new and existing technologies, and are sharing plans with one another. And so we must invest in our anti-fraud programs.”

Strong leadership and the desire to thwart these fraudsters is an important goal of Apollo Education Group. “We are proud of our leadership role in this area and of the many institutions that have come together to fight this common enemy,” finishes Berg. “Therefore, the decision to join the Corporate Alliance was truly an obvious choice for us.”

Read the full partner profile on ACFE.com.

Fighting Fraud a Collaborative Effort

Partner Profile:
MGM Resorts International 

According to Heidi Sealy, CFE, Senior VP of the Fraud Control Group at MGM Resorts International, recognizing that fraud exists in almost any business environment is a crucial first step to actively managing fraud within an organization. "Historically fraud has largely been dealt with on a reactive case by case basis. However, in large organizations it is vital to assess fraud risk across all business operations and proactively put controls in place to prevent fraud from occurring," Sealy said. "It is also important to create review processes to quickly detect fraud when it does happen, so it can be eliminated and prevented in the future." 

Sealy sees fighting fraud in a large organization as a collaborative effort. MGM Resorts International grew through acquisition when MGM purchased Mirage Resorts in 2000 and then Mandalay Bay Group in 2005. With the development and opening of City Center in 2008, the company grew to 16 domestic casinos with 62,000 employees.  "The workplace cultures and policies were very different at each of the individual companies that merged together under one management team," Sealy said. "A significant portion of our operations were siloed by property, making it difficult to support from a central location. MGM restructured in 2010, resulting in a more receptive environment for corporate support functions." This was also about the time that Sealy began to see the need for a way to identify and acknowledge the fraud that had been happening at each of the individual properties and address it for the company as a whole.   

Internal collaboration with other key departments is imperative to MGM's Fraud Control success. There are daily interactions with internal audit, surveillance, security, legal, compliance and human resources. Strong communications between these departments is essential to MGM's successful fraud efforts, so a significant amount of time and resources are devoted to ensuring open, timely lines of communication containing accurate and relevant information. MGM has also established strong communication ties and daily interactions with outside entities such as gaming regulators and enforcement agencies.

"We recently reviewed our Fraud Control program at a high level and identified what we believe is a real opportunity for us to improve our efforts by establishing relationships and information sharing with other large corporations fighting fraud in their own environments," Sealy said. "We turned to the ACFE for advice and direction. Our decision to join the ACFE's Corporate Alliance came from the highest levels of our organization. Management wants to ensure that MGM takes a proactive, visible and vocal role in fighting fraud in the workplace, both within our organization and elsewhere. Joining a program like the Corporate Alliance to open a dialogue with other corporations experiencing similar frauds and sharing non-competitive information is a real win/win situation. We are eager to speak with other organizations on an extended basis about ways to prevent, detect and investigate fraud activities."

Sealy believes that one of the biggest benefits to joining the Corporate Alliance program, on top of savings on training and exclusive resources, is the networking that can happen between corporations publicly taking a stand against fraud. "The biggest bang for our buck is having an open dialogue with companies that face the same challenges we face. We all benefit when we come together in a variety of different manners." Along with joining the Corporate Alliance program, MGM recently launched hospitality industry roundtable conference call meetings to discuss the latest trends and frauds affecting the industry. "Very little of what we do on my team is competitive in nature," Sealy said. "The more we can communicate and share relevant information across companies, the more effective we will all be in our fraud fighting efforts.

Sealy and her team are just one of many large corporations that have signed up to partner with the ACFE Corporate Alliance program and take a visible stand against fraud. For more information about the program and to read the rest of the profile, visit ACFE.com.

Not in My House: Companies Take a Proactive Stand Against Fraud


Mandy Moody, CFE
ACFE Social Media Specialist

With the changing mindset towards the subject of white-collar crime, corporations around the world are interested in making it clear to shareholders, regulators, the media and investors that they are taking proactive measures to prevent, detect and deter fraud. And it’s no wonder, as a recent COSO study found that news of an alleged fraud resulted in a 17 percent stock price decline in the two days surrounding the announcement. It is only imaginable what a fraud conviction’s effects are on a company. Think Enron, Olympus, Parmalat and WorldCom. 

Just as the effects are becoming more profound, so are the proactive steps companies are taking to prevent fraud from happening in the first place. As the ACFE’s Marketing and Business Development Director Kevin Taparauskas, CFE, said in a blog last year about the evolution of fraud over the past 15 years, “It is no longer a question of whether it is taking place within a company, but rather what are people doing about it?”

One thing companies like Raiffeisen Bank International (RBI) are doing is joining the ACFE’s Corporate Alliance program. The program, which began as a pilot program with anti-fraud teams at USAA and Walmart, provides companies wanting to take a proactive stance against fraud the opportunity to partner with the ACFE to help educate and grow their fraud-fighting teams. Benefits of the program include access to exclusive resources, training and membership pricing.

“Fraud can seriously harm a company,” Dr. Michael Wittenburg, CFE, Head of Risk Quality & Fraud Risk Management at RBI, said. “We need to fight it in every possible manner. We hope that with this alliance we will be able to significantly improve our know-how and get access to global best practices.”

RBI is based in Austria and is one of the most recent companies to join the ACFE’s Corporate Alliance program. RBI is one of the leading banking groups in Austria and Central and Eastern Europe with more than 60,000 employees servicing about 14.2 million customers. According to Wittenburg, they plan on implementing mandatory initial and continuous fraud training to employees and hosting tailor-made advanced trainings. They also plan to make the Certified Fraud Examiner (CFE) credential mandatory for staff in their fraud risk management department. 

Read the full Global Spotlight article.