In his own words, Daniel Jones was "The Dude." With his waist-long dreadlocks, part-time rock band, and well-paid job managing a company’s online search directory—he seemed to have it all. Originally from Germany, Jones, now age 32, earned his doctorate and taught at the University of Munich before coming to the United States, where he started his career in computers. In 1996, Jones started working with the company as a director of operations for U. S.-Speech Engineering Service and Retrieval Technology—working on a new, closely guarded search engine tied to the company’s .net concept.

The company allows employees to order an unlimited amount of software and hardware, at no cost, for business purposes. Between December 2001 and November 2002, Jones ordered or used his assistant and other employees (including a high school intern) to order nearly 1,700 pieces of software which had very low cost but were worth a lot on the street. He then resold them for reduced prices— reaping millions. When items with a cost of goods sold of more than $1,000 are ordered, an e-mail is sent to the employee’s direct supervisor, who must click on an "Approve" button before the order is filled. In no individual order was the cost of goods more than 1,000—he made sure none of the orders required a supervisor’s approval. The loosely controlled internal ordering system reflects the trust the company puts in its employees.

In June, FBI agents said they saw Jones exchanging a large box of software for cash in a department store parking lot.

You are a newly hired fraud examiner. You have been asked to write a preliminary report on the Dude Case scenario based on the information presented in Units 1 to 4 and findings from your additional research. Your essay should be 1,500 words. Word limit is not inclusive of bibliography and cover page

In your essay the following points must be addressed fully:

a) Determine if fraud was committed and if so describe the symptoms of fraud that might be evident to a fellow employee.

b) As discussed in one of the units, all frauds involve key elements. Identify and describe the elements of the Jones fraud.

c) In the scenario, Jones' employer has been putting more emphasis on controlling cost. With the slowing of overall technology spending, executives have ordered managers to closely monitor expenses and have given vice presidents greater responsibility for statements of financial positions. What positive or negative consequences might this pose to the company in future fraud prevention?

d) Describe the company's fraud prevention programme and identify any improvements that might be necessary.