Prosecution Of Fraud Research Articles

The UK's faster payment project: avoiding a bonanza for cybercrime fraudsters

PurposeThe purpose of this paper is to consider the increased exposure to cyber crime which would result if one‐day cheque clearance were introduced in the UK.Design/methodology/approachThis paper undertakes a comparative analysis of the UK and US cheque‐clearance systems, examines the enhanced vulnerability to fraud occasioned by a one‐day cheque clearance system and considers the resulting evidential difficulties encountered in US cheque fraud prosecutions. The paper then anticipates the UK experience and examines recent cyber‐crime cases in the UK. Finally the paper explores the possibility of biometric fingerprint authorisation as a prevention strategy.FindingsThe introduction of one‐day cheque clearance in the USA heralded an increase in cyber‐crime banking fraud and a reduction of the ability of the prosecuting authorities to bring cases to court because of the paucity of documentary evidence. The same pattern of activity would be likely to occur if one‐day cheque clearance were to be introduced in the UK. Banks should lobby for the replacement of cheque banking with biometric fingerprint authorisation of electronic banking transactions as the best way forward.Practical implicationsThis paper indicates the most pragmatic way forward for banks targeted by this type of cyber‐crime and warns the legal profession of the evidential difficulties in US prosecutions.Originality/valueThis paper is of value to legal practitioners, academics, students and financial market professionals with interests in banking, fraud, and cyber‐crime.

Healthcare Fraud: Whose Problem is it Anyway?

The National Health Care Anti-Fraud Association estimates that the annual cost of healthcare fraud is somewhere between 3% and 10% of total healthcare costs.1 That estimate is not only astounding because of its magnitude, but also because of its range, indicating uncertainty. The sum of '100B per year, one way or another, matters. For example, that difference would fund all of the imagined Nationwide Health Information Network (NHIN) in any of its possible forms and a whole lot more. The Office of the National Coordinator for Health Information Technology (ONC) has completed two contracts related to healthcare fraud. The first, performed by the Foundation on Research and Education of the American Health Information Management Association, issued a report in 2005 in which an expert panel recommended a set of “Guiding Principles” for health information technology relating to healthcare fraud management.2 (“Fraud management” is defined as the prevention, detection and prosecution of fraud.) The second contract, performed by RTI International, issued a report in 2007 in which a second expert panel recommended 14 requirements for electronic health records related to healthcare fraud management.3 I served as the co-chairman of the first expert panel and the chairman of the second expert panel. It is my experience with these two panels and the subsequent industry reaction that prompts the title of this paper. In our kickoff meeting under the first contract, Dr. David Brailer, in giving the charge to our panel, asked us to answer the question, “Should the emerging NHIN play a role with regard to reducing healthcare fraud and, if so, what role?” The ensuing contract process involved an extensive review of the literature, on-site interviews with multiple healthcare stakeholders including providers, consumers, payers, healthcare economists, law enforcement, and technology organizations. The expert panel, which included representatives from …

"The Crime of Survival": Fraud Prosecutions, Community Surveillance, and the Original "Welfare Queen"

Journal Article “The Crime of Survival”: Fraud Prosecutions, Community Surveillance, and the Original “Welfare Queen” Get access Julilly Kohler-Hausmann Julilly Kohler-Hausmann Department of History, University of Illinois, Urbana-Champaign, Urbana, IL 61801 Search for other works by this author on: Oxford Academic Google Scholar Journal of Social History, Volume 41, Issue 2, Winter 2007, Pages 329–354, https://doi.org/10.1353/jsh.2008.0002 Published: 01 December 2007

Why (some) fraud prosecutions fail

PurposeThe paper aims to demonstrate the causes of failure of some fraud prosecutions.Design/methodology/approachThe paper provides a review of common contexts within which prosecutions of allegations of fraud are brought and discussion of the factors which influence the prosecutor, the investigator, the defence, the trial judge and the fact‐finders.FindingsSeveral factors are common to many fraud prosecutions which, taken together, make these cases difficult to try and to obtain convictions. Many fraud prosecutions fail because the egregious length of the investigation and trial process jeopardises the mental health of some defendants, preventing them from being tried at all. The mass of documentary evidence adduced can cloud the key issue of dishonesty. Excessive splitting up and “pruning” of the case with a view to making the trial shorter may obscure the essential elements of the case. Effective management of the trial process is sometimes lacking. Presentation of complex facts and egregious amounts of documentation to a lay jury can contribute to the inordinate length of the case and the proposition is made that an alternative tribunal, without a lay jury, may eliminate many of the factors which contribute to the failure of major fraud trials.Practical implicationsThe conclusion is drawn that tribunals sitting without juries would have the effect of shortening the trial without lessening public confidence in the criminal justice system in this very limited class of case.Originality/valueThe paper draws together several key factors found in the author's experience as Director the Serious Fraud Office and as Chairman of the Fraud Advisory Panel which distinguish fraud prosecutions from any other types of criminal case and provides leads for improving future prosecution and trial technique.

Top 10 Ways to Avoid Federal Fraud Prosecution

Top 10 Ways to Avoid Federal Fraud Prosecution

The Ethical Health Lawyer

Health care may be the most regulated industry in the United States, at least in terms of the volume of State and Federal laws and regulations that affect business practices. Lawyers who counsel health care clients often face a dilemma: is the client seeing legitimate advice about the legal limitations on his or her conduct, or is the client seeking to use the lawyer's skills to evade the law? The history of health care fraud prosecutions involving lawyers and other professional advisors in recent years makes this an issue of more than academic interest. The well publicized case of U.S. v. Anderson, in which health care counsel faced charges as co-defendants for purported kickback violations, the recent prosecution of Ernst & Young for allegedly aiding Medicare fraud on behalf of client hospitals, and the recent indictment and conviction of an in-house lawyer in a national durable medical equipment fraud case, make clear that the wrongful use of legal advice by health care clients can lead to significant criminal and civil charges against attorneys.

Enron's Legacy

Enron's collapse was the initial episode in a series of corporate fraud scandals that caused billions of dollars of losses, cost tens of thousands of jobs, and eroded confidence in the integrity of the nation's financial markets. Apart from these very tangible harms, the fraud scandals also contributed to cynical shifts in public attitudes about corporations and their executives. Thus, it was not surprising that Congress called for reforms to address systemic corporate governance failures, while at the same time regulators and prosecutors revised enforcement priorities and developed new strategies to combat large-scale fraud. In addition to increasing transparency and accountability in corporate governance matters, post-Enron reforms give regulators and prosecutors potent new enforcement tools, enhance interagency coordination and cooperation, and provide the financial support essential for the SEC to effectively perform its core regulatory functions. Despite significant post-Enron legislative and regulatory reforms and aggressive civil and criminal enforcement, some observers are skeptical about the pace and focus of the fraud investigations. Of particular concern are what some of them view as skewed prosecutorial priorities. Why, for example, was Martha Stewart on trial when poster CEOs Ebbers, Skilling, and Lay had yet to be charged? This article provides a context for examining these and related concerns. Beginning with Enron, it sets the stage by reviewing seven major financial fraud scandals that have surfaced in the past few years. It then considers important structural reforms that address regulatory and enforcement gaps that allowed Enron and its progeny to slip through the cracks. After evaluating post-Enron reforms, the article examines how - through timely and innovative enforcement strategies - the Justice Department and the SEC have responded to the corporate fraud crisis. It then critiques the criminal enforcement record and challenges several assumptions that underlie criticisms of the current fraud investigations. By examining the government's prosecutorial strategies in the context of Enron, WorldCom, and HealthSouth, the article demonstrates why common criticisms of the timing and direction of recent corporate fraud prosecutions are fundamentally misinformed.

Reflections on Roskill

Recounts how the Frauds Trials Committee, under the chairmanship of Lord Roskill, was established almost 20 years ago to deal with perceived defects in investigation, prosecution and trial of serious and complex fraud, and how different financial services and fraud investigation were then compared with today. Describes how fraudsters have become more resourceful, mobile and international. Outlines the recommendations of the Committee, for instance that a unified fraud office should be set up and that jury trials for fraud be abolished. Reports that neither of these reforms has taken place, although the Serious Fraud Office resulted from the Report. Criticises both the suggestion to abolish jury trials and the lack of resources that governments have made available for tackling the huge amount of fraud that has taken place since Roskill.

Deceived

Suppose you’re trying to access your favorite search engine. You haven’t bookmarked it, so you type “google.com” in your browser. Accidentally, you mistype “gogle.com” instead. Your browser brings you to a page that looks just like Google’s but is connected to a competitor’s search engine. At the bottom of the page there is some small print warning that the site you’re viewing is not affiliated with google.com. Did you take time to read it? Probably not. Something similar would have happened if you had typed “gugle.com”, “guggle.com” or “goggle.com.” You’ve just been “page-jacked” [2]. While the negative consequences from this particular incident are probably not very serious, it is easy to imagine what might have happened if a criminal tried to simulate your bank Web site—in particular the page where you log-in your account number and your password. Actually, there is no need to imagine it. It has already happened. Page-jacking—the practice of simulating a legitimate page to obtain secrets or business from an unsuspecting Internet user—is an example of Internet deception. Studies have shown that even sophisticated, technologically-competent Internet shoppers are relatively easy prey for such deceptive copycat sites [4]. Page-jacking is just one example of a set of deviant behaviors that we call Internet deception (such as fraud, misleading advertisement, manipulations of financial information). In the period from 1996 to 1999, the number of reports to Internet Fraud Watch (IFW), a research organization funded by a major credit card network, grew more than 250% annually. Consumer complaints have grown so numerous that several federal agencies—the Federal Trade Commission, the Securities and Exchange Commission, and the Department of Justice—have started specialized programs for the detection and prosecution of Internet fraud. While Internet deception is troubling in its own right, its rising occurrence is a threat to Internet commerce. When buyers have trouble discriminating between good and bad products, even a small number of deceptive sellers might “poison” a market—driving out good products and eventually the consumers [1, 7]. To counter this

From Enron to WorldCom and Beyond: Life and Crime After Sarbanes-Oxley

In roughly two years since the corporate meltdown began, federal and state regulators have initiated criminal fraud investigations involving dozens of corporations, including Enron, WorldCom, Adelphia, HealthSouth, McKesson, and Qwest. To date, some ninety corporate owners, executives, and employees have been criminally charged, and the investigations are ongoing. It was against this backdrop that zeal for corporate governance reform gained unexpected momentum in Congress and resulted in the surprisingly quick enactment of the Sarbanes-Oxley Act. Although its principal purpose is to address systemic weaknesses in corporate governance structures, Sarbanes-Oxley also augments prosecutorial tools available in major fraud cases. Critics complain that Sarbanes-Oxley's criminal provisions are needlessly redundant, rely too heavily on enhanced criminal penalties to achieve their goals, and attach far too much importance to filling minor gaps in the coverage of existing laws. This article presents the alternative view that the Act's criminal provisions make significant strides toward piercing the veil of corporate silence. Using as its central focus the essential roles that whistleblowers and cooperating witnesses have played in recent corporate fraud investigations, the article evaluates key criminal provisions in Sarbanes-Oxley that extend new legal protections to whistleblowers and that are likely to provide powerful incentives for potential targets of fraud investigations to become cooperating witnesses. An appendix to the article tracks criminal charges brought against nearly ninety corporate officers and employees in some fifty major fraud prosecutions the Justice Department filed between March, 2002 - when it first charged Arthur Andersen with obstruction of justice - and August, 2003.

Contrasts in tolerance: The peculiar case of financial regulation

Until the eighties the system of commercial fraud investigation and prosecution was extraordinarily undeveloped. By the end of the eighties this system had been transformed. What took place was nothing short of a fundamental rethink of financial regulation and commercial fraud control. By the nineties, however, this process had gone into reverse. The following discussion aims to explain why. The analysis attempts to understand the main shifts in emphasis of commercial fraud control with reference to general trends in financial regulation, the conventional politics of law and order and the practice of commercial fraud control itself. What seems to have happened is that commercial fraud control became temporarily drawn into, and then almost immediately detached from, the conventional politics of law and order. More specifically, the discussion attempts to show how a sharp rise in the prominence of financial regulation as a political issue first coupled commercial fraud control to the major preoccupations of conventional crime policy. Once the importance of financial regulation as a political issue faded, however, commercial fraud control became uncoupled from conventional law-and-order politics, allowing sustained criticism of long commercial fraud prosecutions in the news media to create conditions favourable for decriminalization.

Practice management: Update on coding, ancillary services, and the New Stark Laws

As an introduction, first let us legitimize the inclusion of information on coding and reimbursement in our association’s periodic publication. Arthroscopy is first and foremost an educational tool for the Arthroscopy Association of North America (AANA) and its members. Coding has become one the most challenging parts of our daily practice. Keeping pace with the many changes in surgical and evaluation and management coding requires both interest and diligence. Coding has become an area of intense interest and is mandatory for inclusion into our educational programs. Second, coding has become synonymous with reimbursement. Our ability to effectively and efficiently care for patients is dependent on our success as business people. The safe and satisfactory execution of patient care requires many medical and nonmedical personnel. Recruitment and maintenance of these health care professionals is costly. And last, incorrect coding places us in personal and professional jeopardy. The Center for Medicare and Medicaid Services (CMS) formerly the Health Care Finance Administration (HCFA) has made the investigation and prosecution of Medicare fraud an obvious priority. This reality propels coding into a new and heightened level of importance.

Practice management: Update on coding, ancillary services, and the new stark laws

As an introduction, first let us legitimize the inclusion of information on coding and reimbursement in our association’s periodic publication. Arthroscopy is first and foremost an educational tool for the Arthroscopy Association of North America (AANA) and its members. Coding has become one the most challenging parts of our daily practice. Keeping pace with the many changes in surgical and evaluation and management coding requires both interest and diligence. Coding has become an area of intense interest and is mandatory for inclusion into our educational programs. Second, coding has become synonymous with reimbursement. Our ability to effectively and efficiently care for patients is dependent on our success as business people. The safe and satisfactory execution of patient care requires many medical and nonmedical personnel. Recruitment and maintenance of these health care professionals is costly. And last, incorrect coding places us in personal and professional jeopardy. The Center for Medicare and Medicaid Services (CMS) formerly the Health Care Finance Administration (HCFA) has made the investigation and prosecution of Medicare fraud an obvious priority. This reality propels coding into a new and heightened level of importance.

Implications of Fraud and Abuse in Interventional Pain Management

The federal government has enacted a comprehensive strategy to fight healthcare waste, fraud and abuse. As a result of the federal government's comprehensive strategy, in 2002, the Office of Inspector General announced that improper Medicare payments to doctors, hospitals and other healthcare providers declined 54% from the fiscal year 1996 to the fiscal year 2001. The Office of Inspector General in its 2002 work plan focuses on procedure coding for outpatient services billed by hospital and doctor, coding for evaluation and management services in physician offices and conditions under which a doctor's bill is "incident to" services or supplies among other things. The distinction between fraud and abuse can be very important in determining the potential fines and penalties that might apply, even though it is not clear. Fraud is much more serious than abuse. The degree of intent by the individual or entity under investigation is often the determining factor. The most commonly used statutes for prosecuting or facilitating such a prosecution of healthcare fraud or abuse include HIPAA of 1996, the False Claims Act, healthcare fraud, theft or embezzlement, obstruction of criminal investigations of healthcare offenders, the False Statement Statute, mail and wire fraud statutes, the Social Security Act Civil Monetary Penalties, criminal penalties, and/or Stark laws. This review focuses on various aspects of implications of fraud and abuse in interventional pain management practices including various activities of potential fraud and abuse.

Avoiding Medicare fraud. Part 2.

In 1997, Congress authorized payments to nurse practitioners (NPs) for Medicare-provided services. NP services are now reimbursed at 85% of the physician fee schedule. As this source of reimbursement was realized, so was a new area of liability for NPs. Failure to follow billing rules can result in payment denial, repayment of fees already paid, mandated educational activities, fines, fraud prosecution, loss of Medicare-billing ability, and loss of employment. Appropriate billing entails adhering to guidelines for selecting procedure codes and proper medical documentation. This article identifies high-risk areas for NPs who bill Medicare and provides resources for accessing additional information.

Avoiding Medicare fraud. Part 1.

In 1997, Congress authorized payments to nurse practitioners (NPs) for Medicare-provided services. NP services are now reimbursed at 85% of the physician fee schedule. As this source of reimbursement was realized, so was a new area of liability for NPs. Failure to follow billing rules can result in payment denial, repayment of fees already paid, mandated educational activities, fines, fraud prosecution, loss of Medicare-billing ability, and loss of employment. Appropriate billing entails adhering to guidelines for selecting procedure codes and proper medical documentation. This article identifies high-risk areas for NPs who bill Medicare and provides resources for accessing additional information.

Physician manipulation of reimbursement rules for patients: between a rock and a hard place.

Health plan utilization review rules are intended to enforce insurance contracts and can alter and constrain the services that physicians provide to their patients. Physicians can manipulate these rules, but how often they do so is unknown. To determine the frequency with which physicians manipulate reimbursement rules to obtain coverage for services they perceive as necessary, and the physician attitudes and personal and practice characteristics associated with these manipulations. A random national sample of 1124 practicing physicians was surveyed by mail in 1998; the response rate was 64% (n = 720). Use of 3 different tactics "sometimes" or more often in the last year: (1) exaggerating the severity of patients' conditions; (2) changing patients' billing diagnoses; and/or (3) reporting signs or symptoms that patients did not have to help the patients secure coverage for needed care. Thirty-nine percent of physicians reported using at least 1 tactic "sometimes" or more often in the last year. In multivariate models comparing these physicians with physicians who "never" or "rarely" used any of these tactics, physicians using these tactics were more likely to (1) believe that "gaming the system" is necessary to provide high-quality care today (odds ratio [OR], 3.67; 95% confidence interval [CI], 2.54-5.29); (2) have received requests from patients to deceive insurers (OR, 2.44; 95% CI, 1.72-3.45); (3) feel pressed for time during patient visits (OR, 1.69; 95% CI, 1.21-2.37); and (4) have more than 25% of their patients covered by Medicaid (OR, 1.60; 95% CI, 1.08-2.38). Notably, greater worry about prosecution for fraud did not affect physicians' use of these tactics (P = .34). Of those reporting using these tactics, 54% reported doing so more often now than 5 years ago. A sizable minority of physicians report manipulating reimbursement rules so patients can receive care that physicians perceive is necessary. Unless novel strategies are developed to address this, greater utilization restrictions in the health care system are likely to increase physicians' use of such manipulative "covert advocacy" tactics.

Fighting fraud: An evaluation of the government's social security fraud strategy

This article examines the government's strategy for dealing with social security fraud. The Social Security (Administration) Fraud Act 1997 has been enacted to facilitate the detection, prosecution and punishment of benefit fraud. In addition, the government has published a Green Paper on fraud and, more recently, a Command Paper on ‘Safeguarding Social Security’, both of which emphasize the importance of preventing fraud and re-educating the public about its nature and severity. Both papers, however, fail to deal adequately with the motivations to commit fraud and how this may impact on public attitudes to fraud. This article examines public reaction to benefit fraud, and points out that the public have differentiated fraud on the basis of ‘greed’ or ‘need’. I suggest that, if the government's anti-fraud strategy is to be effective, the link between justifiable motivation and public opinion needs to be taken into account.

Fraud Investigation and Prosecution — The Way Forward

The effective investigation and prosecution of fraud and other white‐collar crimes remains as difficult today as it was in 1948 when the Metropolitan and City of London Police Company Fraud Department was set up to cope with the increase in fraud cases that was apparent after the Second World War.

Supranational investigation after Amsterdam, The Corpus Juris and agenda 20001

The article is a continuation and update of a series exploring the development of a system of supranational investigation within the European Union. It argues that the Commission's focus of attention has shifted from a data‐base dominated approach to a drive to establish a legal framework within which prosecution can take place. After examining the in‐built nature of cross‐border crime, the article updates the status of previously established cross‐border investigative databases. It goes on to discuss the transfer of Justice and Home Affairs from Third Pillar to First Pillar status within the Treaty of Amsterdam, arrangements for the incorporation of the Schengen acquis and proposals for the future work of Europol. It also raises the proposals to create a European Judicial area for the prosecution of fraud against the Community Budget and the institutions and offences covered by these proposals. Finally, the expansion of the EU under Agenda 2000 is addressed, and it is suggested that financial, technical jurisdictional and political problems will continue to impede the progress towards all‐European investigative and prosecutorial systems.