Fraud Investigation Protocols

Compliance Check In! 🔎 How to Investigate Financial Crimes? 🔎 Financial crime investigations require a mix of data analysis, regulatory knowledge, and critical thinking to uncover illicit activities. Whether you're in AML, compliance, or law enforcement, here’s how professionals conduct financial crime investigations: 1. Identify Suspicious Transactions – Use transaction monitoring systems to detect red flags like unusual cash flows, structuring, or transactions in high-risk jurisdictions. 2. Gather & Analyze Data – Review bank statements, corporate structures, and customer records to understand financial behaviors. 3. Conduct KYC & Due Diligence – Verify the identity of individuals and businesses, ensuring no connections to money laundering, fraud, or sanctioned entities. 4. Cross-Check Against Watchlists – Compare customer details with sanctions lists (OFAC, UN), PEP lists, and adverse media reports for hidden risks. 5. Trace the Money Trail – Follow financial flows across accounts, shell companies, and offshore entities to uncover illicit networks. 6. Report Suspicious Activity – File Suspicious Transaction Reports (STRs) or Suspicious Activity Reports (SARs) with regulators (FINTRAC, FinCEN, FCA). 7. Collaborate with Authorities – Work with law enforcement, regulators, and financial institutions to track, freeze, and recover illicit assets. 8. Strengthen Preventive Controls – Use AI-driven monitoring, enhanced due diligence (EDD), and continuous training to prevent future crimes. 🚨 Financial crime investigations are complex but essential in protecting financial systems from exploitation. What challenges do you see in investigating financial crimes? Let’s discuss in the comments! #FinancialCrime #AML #Compliance #FraudInvestigation #MoneyLaundering #RiskManagement #Sanctions #FinancialFraud #RegTech #DueDiligence #ForensicAccounting

#INVESTIGATION STEPS Your manager has requested you to carry out an investigation into alleged fraud at the inventory store involving falsification of goods receipt notes. How do you go about it? 1. Identify the scope/type of the investigation:- Know the specific investigation you are reviewing. eg falsification of supplier invoices is different to theft (physical removal) of inventory 2. Maintain an impartial approach:- Do not presume anyone is guilty or innocent until you have evidence to support. Everyone should have a chance to defend themselves. 3. Gather background Information:- Clearly understand what happened, how it was discovered and reported, what evidence you need to gather, how you will gather evidence, and what policies and procedures were violated. 4. Gather and preserve evidence:- Correctly gather evidence, obtain evidence first-hand (not reported), preserve the evidence, and corroborate evidence. 5. Maintain Confidentiality: Blowing up the investigation cover too soon will jeopardise the progress. Only share information with relevant team members and on a need-to-know basis. 6. Prepare an investigation report. Prepare a fact-based investigation report, clearly stating the impact of the fraud on the organization. 7. Rope in legal team: Have the legal team appraised of the investigation to ensure compliance with relevant laws and regulations.

Mastering Investigation and Interrogation in Security & Loss Prevention. Day 12: Investigating Internal Theft. Title: When the Threat Comes from Within: Handling Employee Theft Cases. The hardest theft to investigate is not committed by outsiders—it’s done by people we work with. Let’s talk about how to approach it the right way—professionally, legally, and discreetly. First Signs of Internal Theft: ● Inventory discrepancies ● Suspicious POS refunds or voids ● Unexplained access to restricted areas ● Frequent presence during incidents ● Tips or complaints from co-workers Never jump to conclusions. Suspicion is not proof. Begin with a plan. Step-by-Step Guide to Handling Employee Theft Investigations. 1. Start Discreetly. Limit who knows. Inform only relevant stakeholders—usually security, HR, and senior management. This protects the integrity of the investigation. 2. Gather Evidence Carefully. Pull relevant CCTV footage, access logs, transaction records, and any paper trails. Be thorough—every small detail may matter later. 3. Maintain Objectivity. Avoid bias. Investigate facts, not feelings. Treat the suspect fairly and professionally throughout the process. 4. Coordinate with HR. Before you interview or confront the employee, involve HR. Their presence ensures fairness, protects the rights of the employee, and maintains internal protocols. 5. Conduct a Professional Interview or Interrogation. Start with a neutral tone. Ask open-ended questions. Present facts only when necessary. Avoid accusations. Remember: your goal is to find the truth, not force a confession. 6. Secure Any Confession Properly. If the employee admits to wrongdoing, document it clearly and voluntarily. Include HR and a witness, and have the employee sign a written statement. 7. Report and Recommend. Conclude with a detailed report. Present evidence, timelines, interviews, and conclusions. Recommend next steps—whether it’s disciplinary action, legal referral, or policy review. Key Reminders: ● Always protect evidence. ● Stay within legal and ethical boundaries. ● Keep the matter confidential until resolution. ● Think about preventive action after the case—update policies, install surveillance blind spots, or improve audits. Employee theft cases are not just about catching the culprit—they’re about preserving trust and protecting the organization’s culture and integrity. Tomorrow: Day 13 – Teamwork Makes the Truth Work: Who You Should Involve in Investigations. Have you ever dealt with an internal theft case? What were the biggest challenges you faced? #SecurityProfessionals #LossPrevention #InternalTheft #EmployeeMisconduct #WorkplaceInvestigations #SecurityTraining #SecurityLeadership #RetailSecurity #ConfidentialInvestigations #LinkedInSeries

SFIO’s Search, Seizure & Freezing Powers What Every Company Must Know   When the Serious Fraud Investigation Office (SFIO) is appointed under Section 212 of the Companies Act the implications go far beyond routine questioning Most executives think: “We’ll cooperate, submit documents, and it will end there” But SFIO has powers that can immobilize a company overnight Key Powers Under the Companies Act, 2013 Search & Seizure (Sec. 217): With court approval, SFIO can enter company premises search for documents, and seize books records, or digital evidence Seizure Without Court Approval (in some cases): Where there is risk of removal, alteration or destruction of evidence, SFIO can act quickly though subject to later court validation Freezing of Assets (Sec. 221): SFIO can recommend freezing of company accounts securities, or assets if it believes they are linked to fraud Arrest (Sec. 212(8)): In serious fraud cases SFIO officers (not below Director rank) can arrest company officials, subject to informing the magistrate You may find companies suddenly paralysed: Bank accounts frozen disrupting salaries and vendor payments Digital servers seized leading to operational blackouts Senior management arrested creating reputational crises Unlike routine MCA inquiries SFIO probes are multi-dimensional and often overlap with ED, CBI, or SEBI investigations When you sense that a routine inspection may escalate to SFIO: Audit your compliance posture internally before the first knock Set up digital forensics readiness servers, emails, and backups must be managed lawfully Have a crisis protocol for communication with employees, banks, and regulators Because once SFIO acts, reactive defence is often too late Don’t wait for the knock at your door Prepare your compliance and crisis strategy before the SFIO does it for you #SFIO #LegalAwareness #CorporateLaw #WhiteCollarCrime #Law #RegulatoryRisk #FraudInvestigation