The results of the University of Texas (UT) ticketing investigation recently hit the news. According to an article in the Austin American-Statesman,
…athletics employees systematically abused their access to Longhorns football tickets for years, resulting in preferential treatment for favored donors, secret arrangements with ticket brokers and untold financial losses, an audit obtained by the American-Statesman reveals.
The investigation started with a tip, which is the most common way for a fraud to be uncovered, according to the Association of Certified Fraud Examiners 2014 Report to the Nations.
What could have been done to catch this earlier?
The “UT Report” reveals a number of issues that could have been detected with data analytics:
- The same credit card was used to pay for tickets on multiple accounts
- Complimentary tickets were voided after use
- Certain accounts received preferential treatment without justification
- Complimentary tickets were sold on the secondary market
What can you learn from this?
Using the pre-mortem management technique—projecting failure, then working backward to determine what went wrong to prevent that failure—you can leverage several points in time to prevent or mitigate fraud.
- Before the fraud gets out of hand
What to do: Detect anomalies in your data
How: Data analytics. Procedures must be tailored to your organization, but where there’s data there can be data analytics. Ask how fraud or potential risk conditions would appear in your data and then build data analytics procedures to search for that.
- Before the fraud happens
What to do: Identify and defuse the individual likely to commit fraud
How: Email analytics. Email can be analyzed for key terms of concern, or more advanced analysis, such as emotional tone detection or topic mapping, can provide insights into individuals’ pressures and rationalizations. By isolating the search to individuals who have the opportunity to commit fraud, all three sides of the Fraud Triangle are addressed.
- As soon as someone in your organization knows
What to do: Receive an employee tip
How: Implement a fraud and ethics hotline and encourage transparency in your organization.