Financial Institutions being the custodians of public funds and providers of loans are always at risk of fraudulent attempts of borrowers either to misrepresent themselves as financially strong or viable to qualify for loans and subsequently attempt to draw out all the loans proceeds by illegal means.
This couse is designed to identify fraudulent attempts by borrowers at the loan processing stage or risk evaluation process and then subsequently at loan disbursement using various techniques.
- Be able to identify the symptoms of fraud.
- Understand the modus operandi of fraudsters.
- Appreciate the vehicles being used for fraud.
- Appreciate how borrowers use creative accounting to misrepresent financial condition.
- Learn the practical steps in the scrutiny of loan and trade documents.
- Implement measures to reduce the window of opportunity for fraud.
- Analyse Audited Accounts with a fraud perspective.
- Use Risk Management techniques derived from in-house data.
- Apply and appreciate course objectives through Case Studies.
Instructor-led activities via group discussions, exercises and case studies.
Module 1: TYPES OF FRAUD
Module 2: FRAUD VEHICLES
- Security Documents.
- Corporate Structure.
- Business Practices
- Loan Structuring. (terms, conditions and waivers)
- Trade Documents
- Loan Products (weak features)
Module 3: SYMPTOMS OF FRAUD
- Borrower profile.
- Creative Accounting.
- Account Conduct.
- Business Operations
- Security Proferrred (Pyramid Scheme)
Module 4: FRAUD IDENTIFICATION
- Exercises in scrutiny of documents.
- Unusual features account conduct.
- Site visit.
- Scrutiny of audited accounts.
Module 5: MODUS OPERANDI
- Early Drawdown
- Invoicing Techniques.
- Fraudulent Progressive Drawdown.
- Encashing Letters of Credit
- Restructuring Loan Products
- Restructuring security and substitution after Letter of Offer
Module 6: RISK MANAGEMENT AND FRAUD PREVENTION USING INTERNAL DATABASE
- Know Your Customer
- Tightening Loan Usage Conditions
- Operational Alertness and Random Sampling of transactions
- Managing Risk using internal data sources (multiple performance criteria)
- Using External Data Sources
- Checklist on Red Flags combined with external data sources.
Module 7: CASE STUDIES
- Case Study incorporating elements of the subjects of Modules 2 – 6.
Module 8: WORK BASE ASSIGNMENT (Action Plan)
- With the assistance of the trainer, participants are to decide on a project paper related to his area of work and competence. Methodologies should be work-related and reflective as far as possible and should provide organisational benefits and lead to individual development. Participants are advised to discuss with their immediate superior as soon as possible before writing the project paper.
- Deliverables are:
- Half day Post Course discussion with Trainer in one month (complimentary)
- Submission to Division Head or relevant authority within 2 months
- Implementation in workplace within 3 months of course attendance.