Managing the Fraud Risks of 21st Century Technology

LETTER FROM THE PRESIDENT

James D. Ratley, CFE
ACFE President and CEO

Today's businesses and governments rely heavily on exchanging computer data files to inexpensively collaborate on projects anytime, anywhere. The basic ingredients — widely used applications and 24/7 global connectivity — have long been cobbled together to gain limited, but important, advantages. For nearly two decades, we have run our favorite software on stand-alone or networked PCs and emailed our data files to colleagues around the world.

However, the game is changing. Organizations can now cut costs and reduce maintenance responsibilities by storing and using their data via various offsite "cloud computing" options offered by hundreds of new and established companies.

Besides providing worldwide file creation and sharing without having to use email or a company network, the cloud allows companies to "rent" only the applications, processing power and computing infrastructure they need today and reduce their consumption with minimal losses whenever it suits them.

Even so, the numerous operational and cost advantages of doing business in the cloud come with a corresponding array of disadvantages for CFEs. For example, it is often difficult to maintain chains of custody over evidence in the cloud's diverse virtual computing environment. As ACFE Faculty Member Walt Manning, CFE, recently wrote in Fraud Magazine, "The legal, digital forensics and e-discovery communities must revamp their mindsets, tools and training programs to address the new challenges presented by cloud computing." ("Investigating in the Clouds: Cloud Computing Shakes Up Examination Process.")

Read the full "Letter from the President" in the September/October issue of Fraud Magazine.

Risky Readers: Kindles, Nooks Capable of Storing More Than Just Bestsellers

GUEST BLOGGER

Walt Manning, CFE

Director, Techno-Crime Institute

Dallas, Texas

The experience of attending the ACFE Annual Fraud Conference in San Diego was somewhat different for me this year, as it was the first time in many years that I did not speak. This allowed me to attend some presentations that I would not normally have had time for in the past. In addition to the networking opportunities, my attending also reinforced the value of obtaining current information regarding new developments in our field. 

Because my specialty focuses on digital forensics and e-discovery, I always enjoy hearing any presentation by Amber Schroader, CEO of Paraben Corporation. I had always known the security risks of portable data storage devices, which include not only cell phones and USB devices, but also other devices that people may not think about such as MP3 players and iPods. We must also not forget the exploding tablet market, with the extremely popular iPad and similar products.

However, Amber brought another device to my attention that I had not even considered: electronic readers such as the Kindle or the Nook. When these devices are connected to a computer via their USB cable, they are capable of storing any type of data – not just publications. Amber also briefly described how she had installed the Android operating system on the memory card in her color Nook e-reader, allowing her to convert it into a functioning Android tablet computer with Wi-Fi capability. The interesting thing about this “hack” is that when the Nook is booted with the memory card containing the Android operating system it will function as a tablet. However, if the memory card is removed and the Nook then booted the regular Nook operating system and user interface appears, which does not show any of the non-Nook data. 

Other technology developments, such as cloud computing and its impact on investigations, are also areas that fraud examiners must be aware of and consider in the future. To learn more about the issues related to cloud computing, be sure to look for my upcoming article in the July/August issue of Fraud Magazine entitled “Investigating in the Clouds: Cloud Computing Shakes up Examination Processes.”