One of the worst things that organizational executives face is the possibility of adverse publicity. All manner of effort is placed on making effective decisions that produce positive results and publicity that promotes the organizations mission. But, one thing that cannot be controlled is the choices that our employees make. Needless to say, organizations must face the very real possibility that employees may make less than effective or ethical decisions.
In the case recently reported from the University of Central Florida – an associate dean in the College of Engineering has been arrested and charged with grand theft. Jamal Nayfeh is facing fraud and theft charges after he allegedly charged $40,000 worth of home electronics to a university-issued credit card and tried to conceal the purchases from the university, The Orlando Sentinel reported.
As a white collar crime expert – speaker and fraud prevention consultant – the question always arises – what would motivate such behavior? Nayfeh purportedly had the equipment installed in his $900,000 dollar home located in the gated and secluded community of Seminole Woods in Geneva.
There are three components of fraud: (1) need; (2) opportunity and (3) rationalization. I can’t speak to need or rationalization, yet, those two components are necessary parts of fraud. Regarding “opportunity” – unfortunately the University of Central Florida created that with the all too easy issuance of a university issued credit card. According to Fox News – UCF spokesperson Grant Heston says Nayfeh and other employees with the college credit cards had to sign an agreement promising to only purchase goods for the schools use.
Good people, people who you would never suspect, can be tempted and make choices that have very serious consequences. A university spokesman, Grant Heston, said Mr. Nayfeh was suspended with pay this month after auditors discovered the purchases, made in December. The arrest affidavit says that Mr. Nayfeh gave the auditors an “altered receipt to make it appear that non-taggable business related items were purchased … rather than a home-entertainment system.”
But could such a purported fraud be prevented. Yes. While Mr. Nayfeh made the choices that would lead to his arrest, the University provided the opportunity. This is very much like a similar situation with the Dallas Independent School District where the FBI has under investigation over 90 individuals who misused organizational credit cards.
Let me be clear – I do not hold the University at fault nor do I hold the Dallas Independent School District responsibile for their employees fraudulent activities. As a fraud prevention consultant, however, it is practical to observe how the fraud took place. Had the opportunity not been in place there is a very real likelyhood that the fraud would not have occured.
According to a story on WFTV.com:
Nayfeh’s attorney had brokered a deal with UCF police to turn himself in at the Orange County jail as soon as an arrest warrant was produced. That warrant was issued Wednesday afternoon and Nayfeh turned himself in on charges of second-degree grant theft, fraud and credit card fraud greater than $100.
Among the $40,000 worth of items allegedly charged to Nayfeh’s UCF credit card were a home theatre system with an 80-inch screen, high-def projection system and surround sound, 52-inch LCD TVs in each bedroom and racks and racks of high-end audio equipment.
UCF spokesperson Grant Heston said Nayfeh made the purchases in December and had all of that equipment installed in his home. UCF auditors found the purchases after the high-dollar amount was red-flagged.”The individual has been suspended from the university. The legal process is running its course. And our intention now is to be reimbursed to the fullest extent possible,” Heston said.
Every choice has a consequence. It is fair to be aware that though Mr. Nayfeh has been charged, he is innocent until proven guilty.
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