Posted by & filed under Auditing.

Description:  In Nova Scotia, the RCMP have now laid charges against James Edward Marlow, for allegedly misappropriating at least $243,000 from the Coady Institute. The Coady Institute, on the campus of St. Francis Xavier University in Antigonish, is known for its work in training for international development efforts. The fraud was detected by an auditor who investigated a situation where a supplier received payment despite having not issued the related invoice. Apparently, the payment had been designated “hold for pickup” but somehow it found its way Into the mail. It would seem that cheques in the “hold for pickup” category were “picked up” by the perpetrator of the fraud and deposited to his own account. See additional details at https://www.cbc.ca/news/canada/nova-scotia/st-f-x-coady-institute-jim-james-marlow-misappropriation-of-funds-1.4808643

Date:  October 25, 2018

Source:  cbc.ca

Link: https://www.cbc.ca/news/canada/nova-scotia/fraud-theft-charges-laid-finance-director-coady-institute-st-fx-1.4878029

 

Discussion points:

1) Why do you think the auditor followed through on this issue of the supplier receiving payment for an invoice that they had never sent out?

2) What type of lessons do you think an organization can learn from such an incident?

3) In Wiley’s  Auditing: A Practical Approach  you can read about the fraud triangle. How might the three sides of the fraud triangle been in play in this situation?

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