Payroll Fraud

Payroll fraud refers to the deliberate manipulation or misrepresentation of payroll records to illegally obtain money from an employer. It involves various deceptive practices such as creating false employees, altering work hours, inflating salaries or bonuses, or providing unauthorized benefits to divert funds for personal gain. This type of fraud can be committed by both employees and employers, with the aim of embezzling funds, minimizing tax obligations, or evading payroll costs.

Payroll fraud often goes unnoticed due to complex payroll systems and lack of proper oversight. It can have significant financial implications for businesses, resulting in financial losses, reduced employee morale, and potential legal consequences. Preventive measures, such as implementing strong internal controls, conducting regular audits, and utilizing automated payroll systems, are essential to detect and deter payroll fraud.