Hill & Associates

Service Line - Business Intelligence & Integrity Risk

Fraud Prevention & Investigation - Employee Kickback Investigation

Industry – Retail

When an international fashion house began noticing discrepancies in their inter-office payment procedures between an Asian city and their US headquarters, they initially suspected little more than a lack of controls. Two locally employed expatriate managers were installed in the Asian office by the US headquarters to oversee operations but both were soon 'fired' by the local director. Soon it became apparent that there was more to the problem than a simple lack of controls or cultural misunderstanding.

H&A Approach:

Subsequent investigations carried out by Hill & Associates investigators revealed that the local director, who was the purchasing manager, had been taking significant kickbacks from quota brokers and had been embezzling money for several years through an intricate network of concealed factory ownerships and partnerships. In an ill-fated attempt to 'keep sweet' the local office staff, the director even distributed an extra bonus of approximately US$2,000 to each person.

Benefits to the Client:

It was identified and estimated that the company lost several million dollars over several years from the actions of this individual alone.

Fraud Prevention & Investigation - Procurement Fraud Investigation

Industry – Retail

It was suspected that the client was facing purchasing irregularities and kickbacks that involved its key employees and managers in India.

H&A Approach:

Hill & Associates conducted a covert investigation for this large retail chain in India. A task force approach was implemented that included investigations involving review of documentation, scrutiny of transactions with the suppliers, computer forensic recovery and examination of suspects' computers, forensic auditing of accounting ledgers and investigative interviews.

Benefits to the Client:

The investigation successfully established existence of large scale procurement fraud by some of the key employees. Employees were found to be submitting quotes from fictitious companies and falsified invoices. Further, Hill & Associates recommended changes in the internal controls and auditing procedures with a view to protect the client from internal fraud in future.

Fraud Prevention & Investigation - Insurance Fraud

Industry - Insurance

One of the leading insurance majors in India wanted to ascertain credibility of the life insurance claim by father of the deceased (the Subject). The Claimant had stated that the Subject had died in a road accident while driving a vehicle. Further, the claimant had submitted relevant documents to support his claim.

H&A Approach & Benefits to the Client:

During the course of the investigation conducted by Hill & Associates, it was uncovered that the Subject was mentally retarded and was incapable of driving. Interviews with the locals confirmed the findings and a detailed report was submitted to the client. Based on the findings, Hill & Associates also recommended that the legal team of the client should interview the claimant again. Other than providing necessary supportive documents, we also cited the issues to be explored during the interview. Our team also informed the client that the claimant was likely to turn hostile and recommended a number of precautionary measures.

Fraud Prevention & Investigation - Supply Chain Fraud

Industry - Mining

A Client of Hill & Associates received anonymous allegation that their product was illegitimately traded in the India market and also that some of the senior employees were party to the fraud. The main objective of this investigation was to uncover the modus of operandi as well as names of employees involved in fraud.

H&A Approach:

Hill & Associates’ investigation team studied the distribution network and supply chain of Client’s product and conducted discrete enquiries at various levels to ascertain the truth behind the allegation. Investigations revealed that during transportation, drivers in collaboration with the local transporters were stealing product in small quantities each time they travelled and stored the same in warehouses hired specially for those products. When the quantity was large enough to be sold in the market, the product was made available for sale at a price much lesser price than the actual. In some instances low quality local product was substituted with the Client’s high quality product as well.

Benefits to the Client:

Investigative interviews of key sources indicated names of two senior level employees in the Client’s organization to be involved in this fraudulent practice. Further, focused investigation was carried out on the two suspected employees during which both were found to be guilty of fraud.

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