The session will begin with a very high-level introduction to basic fraud principles. The session will highlight examples of fraud in the environmental and related areas that have been publicly reported. The presentation will include a segment on good practice for fraud brainstorming and approaches to testing for fraud in Internal Audit (3LOD), including reference to IIA Practice Guide on the topic. The presenter will provide example scenarios where fraud could be plausible, and will provide some introductory tips on building fraud detection into environmental auditing programs (2LOD), as well as for Internal Audits (3LOD) that touch upon areas where environmental risk is relevant.
- Understand the extent to which environmental matters affect many industries, and how this has changed over the past two decades – and continues to change.
- Learn of common gaps in internal systems and controls for environmental management, which can present the opportunity for fraud.
- Develop tips for planning to test for fraud in 2LOD or 3LOD auditing programs, as well as suggestions for improving controls to prevent fraud.
Douglas Hileman, CRMA, CPEA, FSA
President, Douglas Hileman Consulting LLC
Douglas Hileman has experience in four “Lines of Defense”, according to a global model of compliance and risk management: Operations and Corporate Compliance (first Line of Defense – 1LOD); auditing of environmental, safety, sustainability, and supply chain risk (2LOD); Internal Audit (3LOD); and supporting external financial audits, as well as external assurance engagements for the SEC’s conflict minerals rule (4LOD). He has also led efforts on environmental auditing for negotiated civil and criminal enforcement instruments (with the U.S. Department of Justice) on a multi-national matter. He has co-authored several pieces of supplemental guidance for the Institute of Internal Auditors (IIA), including a Practice Advisory on fraud in engagement planning. He authored the first piece on environmental fraud in the BNA Environmental Reporter. He has presented on risks, and potential fraud, in non-financial reporting to several chapters of the Institute of Internal Auditors. He was co-chair of programming for the 2019 International IIA conference, where he also co-presented a workshop on Ethics prior to launching his firm in 2008, Mr. Hileman worked at a Big 4 accounting firm for six years, environmental management consulting firms for ten, and in industry for nine. Mr. Hileman holds credentials as a Certified Risk Management Assurance (CRMA) professional, a Certified Professional EHS Auditor (both administered by The Institute of Internal Auditors) and Fundamentals in Sustainability Accounting (administered by the Sustainability Accounting Standards Board).
Kevin Thomas, CPA, CIA, CAMS, CRMA, CGMA
Risk and Business Control Advisor, USAA
Kevin Thomas is a Risk and Business Control Advisor for USAA Federal Savings Bank in San Antonio, Texas. Previously, he was a consultant for Trilliant Risk Advisors performing various reviews of regulatory requirements. He was also the Senior Vice President, Director of Internal Audit (functioning Chief Audit Executive) for a Commercial Bank located in metropolitan Washington D.C., where he was responsible for developing, implementing, and overseeing the internal audit function, including the independent audit for BSA/ AML/ OFAC.
Kevin has over twenty-five years of internal audit experience in banking, military defense, manufacturing, power production, research, and development where he was also responsible for the Corporate Internal Audit Functions. Kevin was also a Manager with Deloitte in the Internal Audit Services Practice covering financial institutions (banks), manufacturers, Hi-Tech and other industries. He began his career in the accounting department of a fortune 500 company and then moved to external auditing where he performed comprehensive financial audits of numerous types of public and private companies; including partnerships, joint ventures, municipalities, and boards of education. Kevin is a Certified Anti-Money Laundering Specialist (CAMS), Certified Public Accountant (CPA) in Maryland and Texas, and a Certified Internal Auditor (CIA). He also holds the Certified Risk Management Assurance (CRMA), and Chartered Global Management Accountant (CGMA) designations.