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Fighting fraud from the top: Illegal activities have simple beginnings

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Ayanda Kotobe ▼ | September 12, 2019
World   Fraud is the result of mirroring

Why do we stop at traffic lights? It's not because we are naturally attuned to seeing red as the order to stop.

If that were the case, red dresses and apples wouldn't be as popular as they are! Red catches our attention, but we stop at a red light because everyone else does.

Humans copy each other. It's often said that if you want someone to be more comfortable with you, mimic how they sit or stand. Psychologists call this ‘mirroring', but it doesn't just happen during social gatherings.

Seeing someone drop a bit of trash or cutting a traffic light gives us a slight nudge into thinking it's okay. If they are doing it, maybe I can too.

Fraud is at its essence the result of mirroring.

It would be convenient to consider all fraudsters as hardened criminals who'd sell their granny if the price were right.



Yet when the people involved got away with that, they scaled up and even justified their actions as legitimate at least to themselves. This is why fraud prevention starts at the top.

There has to be no tolerance among an organisation's leaders for fraud. When accountability and consequences are lacking, fraud will thrive. The culture of an environment, as well as its treatment of ethics and governance, will reflect management's attitude towards fraud.


Illegal activities usually involve acts that siphon amounts from a business' coffers. These can include payroll fraud, writing double cheques for payments, skimming tax money or over-ordering1.




Sadly, it's the company that suffers when their wrongdoing is uncovered, usually because it became cataclysmic...







There is also no reason any more to be ignorant of a company's finances: even if you have accountants and other fiscal gatekeepers, it is possible with modern software services to generate ad hoc reports and scrutinise patterns using visualisation dashboards.

At Kenya's major banks, employee fraud is often a greater risk than third-party fraud. Headline-grabbing South African frauds such as seen at Fidentia and Steinhoff were perpetrated by the very accountants meant to have policed such activities.

It might sound as if the fight against fraud means reducing trust in employees. This isn't the case. Instead, it is about narrowing those gaps where fraud might take place, so as not to normalise such activities.


Consequences must be enforced and felt. Everyone will eventually ignore a traffic light if they see enough people do this. In some countries, you can see traffic officers haplessly direct vehicles that ignore them.


But did they start as criminals? No.

And do they see their behaviour as bad? It's unlikely.


BIOGRAPHY Ayanda Kotobe is a qualified CA(SA) with approximately ten years of experience in the Auditing and Finance field.

She completed her BCom Accounting Honours at the University of Johannesburg in 2009, qualifying as a Chartered Accountant in 2012.

Ayanda began her career at Deloitte and Touche where she completed her articles and became an Audit Senior, and later an Audit Manager.

In 2015, Ayanda moved to Barloworld Equipment where she fulfilled the role of Financial Manager for just under three years. More recently, Ayanda was promoted to Country Financial Director of Barloworld Equipment in Botswana where she was responsible for the full financial function of the company and led the Finance team in Botswana.

Contact the Op-Ed editor Ted Blackwater at

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