Assessing The Fraud Risk Of SME Customers

With an ever-competitive banking marketplace, a banker’s ability to understand market demands and communicate effectively with customers and prospects is essential to retaining customer relationships and increasing revenue. By understanding customer needs, bankers are better able to recommend and sell specific product solutions that meet those needs.

However, it is equally important for the banks not to ignore the importance of properly managing the financial health risks of customers especially the fraud risks. To appreciate the fraud risks, the bankers must have a better understanding of financial information, particularly the balance sheet, profit and loss account and cash flow statement.

Decisions made without properly understanding the financial implications and fraud risks may lead to non-performing loans (NPL) or losses and a reduction in shareholder value.

By raising financial awareness and acquiring knowledge of relevant fraud schemes, participants can better gage the financial health of the client organization and make more effective decisions.

This workshop will focus on the Fraud Risks, rather than credit risks, of the customers. The workshop will cover the basic financial principles, various fraudulent schemes and fraud management tools necessary for an effective decision making.

In particular, the workshop will discuss the techniques to identify, decipher and manage fraud risks in the SME environment. The workshop will also briefly cover UOB fraud related regulatory obligation and approaches to manage difficult communication with the customers.

Learning is achieved via examples, which reinforce the theory, and topic-related videos, classroom discussions, and scenarios designed to simplify the subject matter concepts.

On Day 3, participants will complete a highly integrated case analysis requiring participants to assess the financial health of a SME customer. There will be a group based case-study presentation to UOB management representatives.

Learning Objectives:

• Understand the basic principles of finance and how to read financial statements (including the footnotes)
• Understand the current state of SME business environment in Singapore
• Recognise fraud risks and learn approaches that can mitigate these risks
• Understand white-collar crime and criminal behaviour.
• Decipher the fraud triangle to better appreciate the motivation behind fraudulent practices
• Review various fraud schemes such as financial statement fraud, bribe, money laundering, etc.

Modules:

• Day 1 – Understanding Basic Finance and Accounting Concepts
• Balance Sheet
• Profit and Loss Statement
• Statement of Cash Flows
• Financial Ratio Analysis (Liquidity, Profitability, Leveraging, Activity and Market)
• Understanding Fraud Schemes I – Financial Statement Fraud and Anomalies
• Day 2 – Deciphering Fraud Risks of SME customers
• SME business environment in Singapore
• Understanding Fraud Triangle (Opportunity, Pressure, Rationalisation)
• Understanding Fraud Schemes II (Questionable Claims, Bribery and Corruption, Money Laundering, Terrorism Financing, Export Controls fraud, etc.)
• Understanding White-Collar Crimes and Criminal Behaviour
• Behavioural Analysis of Customers and Analysing Documents
• Day 3 – Part 1: Managing Fraud Risks of SME customers
• Fraud Risk Assessment and Management
• Fraud Prevention Programmes
• Know Your Customers and Due Diligence
• Making ethical decisions
• Forensic and Discovery Services
• Engaging UOB Ethics and Compliance organization
• Managing difficult communication and relationship with customers
• Day 3 – Part 2: Integrated Case Study
• Group Case study review that incorporates the topics covered during the past three days.