BACKGROUND

This is a scam which takes place at a thrift store, Save-Rite. Save-Rite sells mens, womens and childrens clothes, as well as toys, electronics, accessories, and even furniture. Save-rite is a thrift store, so it relies on donations in order to keep up with inventory. The Save-rite employees are responsible for receiving and sorting donations. They are also responsible for stocking the shelves, as well as operating the cash register and ringing up customers purchases. One day one of the employees approaches his colleague about a hole in the internal controls: once all of a customers purchases are rung up, the employees are able to go in and manually change the prices of the clothes. He shows her an example by ringing up a $10 shirt, and then moving the decimal two places to the right, changing the price to $0.10 before he pays for it. Before long, all of the employees are privy to this scam, and are using it to essentially steal whichever pieces of inventory they like. Soon, a couple of these employees tell their friends, who start showing up to take advantage. One day, the manager was checking the amount of revenue generated at the end of the day, and noticed it was staggeringly lower than it should have been. Especially considering the fact that they saw multiple people with shopping baskets that were filled to the brim, the amount that he was getting did not add up.

Investigative Design:

Assume you are a fraud examiner available for hire. Provide a discussion of the approach you, as an investigator, would use to look into a lead received about the possible fraud. The discussion should include several steps and indicate what documents you anticipate will be available and important during your investigation, whether interviews of individuals will be involved, who those individuals might be, and how you might analyze the collected information.

Assume you have received a general lead, but not all of the facts you laid out in your case presentation. Think through what type of actions may have occurred or might be taking place during your investigation. What records might be a good source to investigate the situation? Oral evidence through interview of individuals can be helpful, but documents are necessary to confirm oral evidence. How can you relate oral evidence to documents you expect to find?

Deterrence Measure Design:

Considering the case presented, and the investigative design you offered, what deterrence measures would you suggest to the enterprise you described in your case presentation? Your suggestions will be considered in the context of being both realistic and responsive to the specific presentation you provided.