Computer-related Crimes in Federal Programs: Report to the Congress

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U.S. General Accounting Office, 1976 - Commercial crimes - 24 pages
 

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Page 18 - ... organizational plan that segregates the duties of individuals to minimize their opportunity for misuse or misappropriation of the entity's resources. — A system of authorization and record procedures adequate to provide effective accounting control over assets, liabilities, revenues, and expenses. — An established system of practices to be followed for each duty and function of the organizational element . — An effective system of internal review. This includes an internal audit staff that...
Page 8 - Every incident of computer misuse reviewed by the agency was "directly traceable to weaknesses in system controls... the result of deficient systems designs, improper implementation of controls by operating personnel or a combination of both.
Page 5 - A Government employee who had helped automate an accounting system introduced fraudulent payment vouchers into the system. The computer could not recognize that the transactions were fraudulent and issued checks payable to fictitious companies set up by the employee and his accomplices. These checks were sent directly to banks where the conspirators had opened accounts for the companies. The criminals then withdrew the funds from the accounts. Officials estimated the Government may have paid this...
Page 18 - A plan of organization that provides segregation of duties appropriate for proper safeguarding of the entity's resources. 2. A system of authorization and record procedures adequate to provide effective accounting control over assets, liabilities, revenues, and expenses. 3.
Page 8 - These weaknesses were the result of deficient systems designs, improper implementation of control by operating personnel, or a combination of both. Moreover, the weaknesses were in basic management controls, such as separation of duties and physical access control over facilities. The primary reason weaknesses in system controls existed was that management failed to recognize the importance of controlling systems. This lack of emphasis affected both the way systems were designed and the extent to...
Page 5 - ... tip. Another type of act, which has occurred in several agencies, is the unauthorized use of computers by ADP personnel. An engineer who was no longer employed at a computer installation managed to continue using the equipment for his own purposes. Before he was discovered, he had used over $4,000 worth of computer time. At another installation, a programer used a self-initiated training program to obtain use of his agency's computer system. But instead of working on the training exercise, he...
Page 18 - We recommend that the heads of the organizations which gave us information on computer-related crimes which have occurred in their departments or agencies — the Departments of Defense (Army, Navy, and Air Force) ; Agriculture ; the Treasury ; Health, Education, and Welfare; the Interior; and the Veterans Administration — take steps to insure that systems in their organizations and in those supporting programs they fund have : —An organizational plan that segregates the duties of individuals...
Page 2 - Welfare, in consultation with the Secretary of the Treasury and the Office of Management and Budget...
Page 15 - Federal officials responsible for the audits stated that the programs involved were so large the agency did not have the resources to make onsite inspections or followup reviews on recommendations. They stated they had to do much of their work through correspondence and meetings. They did not assure themselves management had taken appropriate action on reported deficiencies. Although we cannot say that audits of controls would have detected or prevented all 69 incidents, such audits are recognized...
Page 18 - We are therefore sending copies of this report to other departments and agencies for their information and use; we urge them to take the steps stated above to insure the propriety of their operations. We believe the guidance on internal controls, internal audit, and accounting methods provided in our Policy and Procedures Manual for the Guidance of Federal Agencies and in our audit standards, gives appropriate general criteria. In determining whether an agency's accounting system meets the standards...

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