| The Association of Certified Fraud Examiners (ACFE) indicated in their 2014 semi-annual fraud survey that the typical organization will lose 5 percent of its revenues each year to fraud (ACFE, 2014). Religious institutions share this fraud risk and are often the victim of the most common type of fraud identified by the ACFE; asset misappropriation. Newspaper articles in the past few years have highlighted numerous instances of fraud at churches, synagogues and other religious organizations. This is a problem that is increasing each year with losses due to fraud projected to be in the billions by 2025. This project identified the vulnerabilities that cause religious organizations to be susceptible to fraud. Recommendations to reduce opportunity for asset misappropriation caused by these vulnerabilities were examined in this project. The warning signs that may indicate a fraud is occurring in a religious organization were also identified, with the goal of utilizing these warning signs is as a tool to aid in detection of fraud that is occurring. The earlier a fraud is identified in these organizations, the less damage is likely to occur. This project conducted research to determine if there are fraud prevention plans that can assist these organizations to mitigate the risk that they become victims of asset misappropriation. It was found that there is not one model fraud detection plan that can easily be utilized by these organizations; however, this project identifies recommendations for fraud prevention that can be utilized by these organizations to create a fraud prevention plan. This project also makes suggestions for future research to improve the for fraud prevention plans for religious organizations. Keywords: Economic Crime Management, Paul Pantani, ACFE, IIA, AICPA, internal controls, segregation of duties. |
