Employee Fraud and Kickback Scheme

  • 13 Nov 2015 15:52

Employee Fraud and Kickback Scheme



When an international fashion house began noticing discrepancies in their inter-office payment procedures between an Asian city and their US headquarters, they initially suspected little more than a lack of controls. Two locally employed expatriate managers were installed in the Asian office by the US headquarters to oversee operations but both were soon 'fired' by the local director. Soon it became apparent that there was more to the problem than a simple lack of controls or cultural misunderstanding.

Our Approach:

Subsequent investigations carried out by Hill & Associates investigators revealed that the local director, who was the purchasing manager, had been taking significant kickbacks from quota brokers and had been embezzling money for several years through an intricate network of concealed factory ownerships and partnerships. In an ill-fated attempt to 'keep sweet' the local office staff, the director even distributed an extra bonus of approximately US$2,000 to each person.

Benefits to the Client:

It was identified and estimated that the company lost several million dollars over several years from the actions of this individual alone.