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An Investigation of Fraud in Nonprofit Organizations: Occurrences and Deterrents

University of Dayton

Mary Fischer

University of Texas at Tyler

Teresa Gordon

University of Idaho

Elizabeth Keating

Harvard Law School

Losses due to fraudulent activities are particularly troublesome in the nonprofit sector because they directly reduce resources available to address tax-exempt purposes. The ensuing bad publicity also may reduce contributions and grants in subsequent periods. This article uses data provided by Certified Fraud Examiners to report on the types of fraud they identified in nonprofit organizations and the characteristics of both the victims and the perpetrators of the fraudulent activities. Based on the analysis of the data, the authors suggest ways that fraud losses can be prevented or mitigated. In particular, governing boards are urged to consider important controls in addition to the annual financial statement audit.

Key Words: fraud in nonprofits • types of fraud • internal controls • audit committee • nonprofit organizations • employee theft • malfeasance

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This version was published on December 1, 2007

Nonprofit and Voluntary Sector Quarterly, Vol. 36, No. 4, 676-694 (2007)
DOI: 10.1177/0899764007300407


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This Article Abstract Free Full Text (Free PDF) Free Alert me when this article is cited Alert me if a correction is posted Services Email this article to a friend Similar articles in this journal Similar articles in Web of Science Alert me to new issues of the journal Add to Saved Citations Download to citation manager Request Permissions Request Reprints Add to My Marked Citations Citing Articles Citing Articles via Google Scholar Citing Articles via Scopus Google Scholar Articles by Greenlee, J. Articles by Keating, E. Search for Related Content Social Bookmarking                         What's this?