The Fraud Examiner

Are Your Travel Expenses Monitored?
 

September 2013 

By Misty Norris-Carter, CFE, CIA 

 

Have you ever wondered, “Are my travel expenses being reviewed?” Fraudsters who have been successful at defrauding companies through the submission of fictitious travel expenses most likely have. If management, though, has never considered this question from the employee’s perspective, they might unknowingly be paying out thousands of dollars to fund a fraudster’s lifestyle – that fraudster being one of their own employees.

 

Unfortunately, this was the case with New York State Assemblyman William Boyland, Jr. Boyland, indicted on charges of allegedly filing tens of thousands of dollars’ worth of fraudulent travel expenses, claimed he had been traveling on legislative business in Albany, New York, between January 2007 and December 2011 when he allegedly was not (as reported in Metropolis, a Wall Street Journal blog). In fact, in some of the instances where he allegedly claimed he was traveling to Albany, he was in New York City meeting with undercover investigators who were building an unrelated bribery case against him.

 

While the exact dollar amount falsely claimed by Boyland is still uncertain, an audit found no record of him being in Albany 609 of the 975 days he claimed he had traveled there. Based on these audit findings, Boyland is required to repay the state $67,497 in mileage reimbursement and per-diem payments. In addition to the indictment for submitting fraudulent travel expenses, Boyland has two other pending charges against him related to bribery and mail fraud.

 

This is just one example of many where employees abuse company or tax-payer dollars through expense reimbursement schemes. According to the 2012 Report to the Nations, expense reimbursement fraud schemes made up 14.5 percent of the asset misappropriation schemes with an average loss of $26,000. The Report also noted that these frauds lasted a median of 24 months before being detected, as was the case with Boyland.



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