David Anderson is principal of David Anderson & Associates, a Philadelphia forensic accounting firm that provides a full range of fraud investigation, fraud deterrence programs and forensic accounting services in Philadelphia and the Delaware Valley.

With the arrival of Memorial Day, another summer of fun and vacation has begun.  Those employees with vacation homes at the shore or in the mountains will begin regular weekend visits.  Work will slow down or fall behind as employees take vacations, and employers scramble to cover their vacant positions.

While summer is generally fun for all of us, it is especially fun for fraudsters, according to Certified Fraud Examiner David Anderson of the Philadelphia forensic account services firm of David Anderson & Associates. That fun, he said, comes in two distinct areas: Workplace Fraud and Vacation Fraud.

Workplace Fraud

As employers shift schedules to account for employees on vacation, Anderson said they can unwittingly open up increased risk of fraud.  This potential fraud arises from several sources:

• Employees who do not normally perform a sensitive financial job may be drafted to fill in for the vacationing incumbents;
• These “fill-in” employees may not be familiar with fraud deterrence measures in place, and may fail to perform or enforce them;
• These same employees may be provided with passwords and other access rights to computers and/or software to which they normally do not have access;
• When incumbents return from vacation, they may not change their passwords and/or technical staff may not remove the access rights of the employees filling in for the incumbents;
• Reconciling bank accounts and other fraud deterrence measures may be delayed due to backlogs created by vacations;
• Management may relax fraud investigation and oversight as well as forensic accounting measures due to either employee vacations, their own vacations or both.

To avoid these risks, Anderson said management must take steps to ensure:

• “Fill-in” employees are properly trained in not only the incumbent’s job but also the applicable fraud deterrence measures;
• Technical staff sets up separate passwords and access rights for the “fill-in” employees, and promptly removes these access rights as soon as the incumbents return to work;
• Bank reconciliations and other fraud deterrence measures continue to be applied and performed on an uninterrupted or a delayed basis; and
• Management continues to exercise either an increased level of oversight or at least the same measure of oversight as it does the rest of the year.

Vacation Fraud

Fraudsters know people on vacation have relaxed vigilance regarding their debit and credit cards and other personal financial information.  Anderson said an increasing number of fraudsters are using skimmers and other measures to obtain this information.

In particular, the use of skimmers has increased.  Skimmers are electronic data collection devices that are placed over ATM card slots, credit card slots and on credit card swipers.  They have become smaller in size and less noticeable to the point that it can be difficult to ascertain whether or not a skimmer has been placed on the device you are using.

While Anderson said people generally are aware if something appears different in the ATMs and other devices they regularly use at home, relaxed vigilance on vacation and unfamiliarity with ATMs and other devices at vacation locations put individuals at greater risk of having their card and other personal financial information stolen. To emphasize this point, Anderson shared a personal experience:

Last summer, Anderson was on vacation in Asheville, North Carolina.  On the Sunday his family was leaving, he went to the ATM at a local bank and withdrew funds.  Unbeknownst to him, fraudsters had placed a skimmer on the ATM machine. Anderson only learned of the theft of his debit card and PIN information on Monday night when he went online to check his bank account and noticed a strange charge made in Washington state approximately 12 hours after he had withdrawn funds from the ATM.

Anderson subsequently learned the fraudsters had used his debit card and PIN information to purchase an iPhone in Washington state.  When he contacted Ashville bank officials the next day, they checked the ATM and found there was no skimmer on it.  However, they later notified him they had had a number of complaints during the week about people who had used their ATM and had fraudulent charges appear on their debit cards.

Bank officials told Anderson they had instituted a new procedure to check the ATM at the end of their business day and first thing the next morning to see if there was a skimmer on it.  However, they admitted they would have no way of knowing that fraudsters had placed and then removed a skimmer outside of normal banking hours unless they reviewed hours of tapes from each ATM every day.

In the future, when he is on vacation, Anderson said he will only use an ATM that is in a bank’s lobby and only during normal business hours.  He also said he will only use his debit card as a credit card to avoid entering my PIN number.  In addition, he said he is determined to have a higher level of vigilance whenever he uses his debit or credit card out of town . . . and he strongly recommends others adopt this same practice.

If you require the services of a Certified Fraud Examiner or any other forensic accounting services in Philadelphia and the Delaware Valley, please contact the Philadelphia forensic accounting firm of David Anderson & Associates by calling David Anderson at 267-207-3597 or emailing him at david@davidandersonassociates.com.

About David Anderson & Associates

David Anderson & Associates is a Philadelphia forensic accounting firm that provides a full range of forensic accounting services in Philadelphia and the Delaware Valley.  The experienced professionals at David Anderson & Associates provide forensic accounting, business valuation, fraud investigation, litigation support, economic damage analysis, business consulting and outsourced CFO services.  Company principal David Anderson has more than 30 years of experience in financial and operational leadership positions and is a Certified Public Accountant, a Certified Fraud Examiner and a Certified Valuation Analyst.