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What’s going on at DuckCorp? 

What’s going on at DuckCorp? 

(including “what Sophy saw”) 

Dear “Aspiring Financial Damage Detective”.  We welcome your curiosity!  Let’s face it –  DuckCorp is not that different from many other organisations.  Financial Damage happens all the time and people don’t really want to see it unless they have to.  Mike Hammer is not a softy – he’s probably been banging on about it for a few years now, got tired of not being listened to and has given up.  After all, management is human, and it don’t like news either, especially when there is so much of it around these days.  Mike wants to slip quietly into retirement. 

But Sophy is curious.  Like many young people at the start of their careers, especially today, she wants to make a difference and has that “healthy curiosity” which every organisation still needs.  As I said, this case was based on truth.  Here is what was actually going on: 

  • DuckCorp’s management was under pressure to make sales, and one of its largest customers had strong-armed them into paying hefty rebates.  It started off with credit notes but then the management team of the customers got greedy and persuaded DuckCorp’s salespeople to pay out some of those rebates out personally to the management team. Yes OK, some of the salespeople were also persuaded to keep a tiny bit for themselves…for their trouble 
  • The cleaning company was formed of friends of friends.  It charged market rates but had got lazy, it was not hungry enough for new business, and so it started “milking” DuckCorp instead.  And then someone got the idea of buying seconds, again in bulk – lots of it, and of course…selling it on the grey markets as new DuckCorp products 

And there was more, but it would probably have never come to light had Sophy had not pointed it out. 

Let’s face it:  If it walks like a duck, swims like a duck and quacks like a duck…then it probably is a duck (or…it could be nothing at all…a piranha or the tip of iceberg? 

DuckCorp was lucky to have Sophy.  But actually, all she did was Follow the Money, which is the mantra of finding financial damage and resolving it early.  And as we say what can be done by curious humans to recognise and resolve financial damage can also be coded.  

If you would like to know more about  myB4.ai, our easy to use solution which enables and empowers every organisation to become Sophy and recognise and remove financial damage early, just get in touch with me at nigel.iyer@myb4.ai or info@myb4.ai. 

And if you are curious and a wannabe fraud detective like Sophy then why not find out what kind of fraud detective YOU are by taking the Five-minute Fraud Detective Challenge on www.b4fraud.com  

Be part of the future and help make the world healthier, wealthier and wiser. 

Nigel Iyer 

Nigel.Iyer@myb4.ai 

28th Feb 2022 

 

A re-cap on the “Story of DuckCorp and Sophy” 

Once upon a time (based upon a true story)

Recently, in a company nearby…  

Sophy Donaldson, a fresh-eyed intern at DuckCorp, spots a few strange things. Volume discounts and other rebates to a particularly big customer are paid to a completely different company…in a different location. DuckCorp´s cleaning company is charging for more hours than there are in the day. Inventory cannot be accounted for and therefore where is it going and who is taking it?  Certain cash payments look a bit odd too but she´s not had time to consider those as yet.  After all it’s only Sophy´s first week. 

So Sophy meets with Michael Hammer the head of accounting and explains what she has found.  Mike, a sweet grandfatherly chap had interviewed Sophy for the internship and has been at DuckCorp for a very long time. He tells Sophy that the management likes good news, because DuckCorp is doing “just fine.” This would open a can of worms…they would hate hearing it, and then, with a little smile, says, “but it would be good medicine if you tell them!” 

So, what do YOU think is going on?
(remember more than one answer may be correct)
 

  • That customer is really putting the thumbscrews on DuckCorp… or someone is stealing those volume discounts 
  • Worse still, the volume discounts could be “bribes” – cleverly disguised of course  
  • The cleaning company has a rather too close relationship with DuckCorp. Not only can they charge what they want, but they are selling products on the black market 
  • If Sophy saw all this in a week, what other unnecessary costs does DuckCorp have?  Maybe there is a lot of clean money to be saved…or made here? 
  • Michael probably knows a lot more but feels no one listens to him 
  • Nothing out of the ordinary. And Sophy is going to do nothing.  She´s just an intern.