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Forensic Accounting Case Study 9-26 (1)

Case study 3 in this situation the abc construction

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what’s going on around the company. Case Study 3 In this situation the ABC Construction company began pressuring employees to process an increasing amount of contracts and also to decrease the time required to process these contracts. This significant change in expectations caused numerous employees to quit working. It was also communicated that ABC made efforts to hide the fact that it was losing employees from the government. There are a few symptoms of fraud in this case. ABC Construction carries out its business using subcontractors. However, for some reason the company seems to make an effort to maintain that it is not in any way related to these other entities. This attitude of separation could be a symptom of fraud simply because it is unusual for a company to try to distance itself from another that it frequently interacts with. One would think that a business plays such an integral part in ABC’s business model would be considered a close partner. The fact that ABC construction operates separately from these other businesses could be used as a means to protect them from investigation should the subcontractors fail to perform. While it is understandable that a company would position itself to minimize liability, the behavior itself is worth investigating. With fraud symptoms there could always be another reason a person is behaving in ways that might indicate a fraud. An investigator would have to consider other possible reasons why ABC Construction maintains independence from its subcontracted workers. ABC also attempted to hide the fact that turnover within the company had increased. If the
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government learned that employees had begun leaving the company it is very likely an assessment of ABC’s ability to maintain the contracts would have been carried out. An undercover operation would be one of the more effective approaches to investigate the fraud for several reasons. First, an undercover operation would allow the Naval Crime Investigative Service to accumulate all the necessary types of evidence needed to prosecute ABC Construction, Inc. NCIS would have in its possession the initial contract agreement and possibly any documents used to track contract performance and progress. If it became apparent that ABC hid, tampered with, or destroyed such documents NCIS would have be able to prove that ABC had the intent to defraud the federal government. Acting as an
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