Making fraud too easy? | AccountingWEB

Making fraud too easy?

The other day I saw a demonstration of the latest version of a well known payroll package for small businesses.

The demonstrator waxed lyrical about the new facilities, including 'undo' and 'rollback'.  It seems that in future it will be a simple matter to reopen finalised payrolls for previous weeks and months at any time in the same tax year and amend the pay details - producing new payslips and reports.  There seems to be no reason why - after those have been produced - the figures could not be changed back again to what they were before.

Now maybe I have a particularly nasty and devious mind, but I did wonder what opportunities this would offer for fraud and false accounting.

Would it be possible, I asked myself, for a dodgy payroll clerk to produce false payslips for staff in support of their claims for social security benefits / tax credits (showing artificially low income) or mortgage applications (showing artificially high income)?

Would it be possible for a company to underpay HMRC by producing false management reports showing that the payroll costs had been lower than they really were?

I didn't voice my thoughts.  After all, the more financial crime there is the more business I can hope for in future!


ShirleyM's picture

It has always been possible, David

ShirleyM | | Permalink

I won't explain how, but anyone with a bit of imagination and skill could do that.

Why risk the loss of career, reputation, a clear conscience and a good nights sleep, for a few bob?

davidwinch's picture


davidwinch | | Permalink

If I had wanted to produce a couple of month's false payslips for a colleague I have no doubt I could do it using the old version of the software.  But it would involve a bit of messing about - and as you say a certain amount of imagination and skill.

But the new functions are on the menu bar and so rather less imagination and skill is now required.

In my experience many users of the software would not finalise one payroll until they needed to run the next one.  But the new facility allows amendments to be made to any payroll in the current tax year.  I really cannot see the (legitimate) need for that - can you?


As a writer of payroll software than can do this

stirfry | | Permalink

Yes there are legitimate reasons to have 'rollback' on a payroll system. The most obvious case is where an employee has been marked with the wrong date of birth, hence state pension date and change of NIC contributions, letter 'C'. With rollback you can fix this without restoring back to a previous date for ALL the employees. HMRC Accreditation actually has this scenario.

I strongly recommend to my clients finalize the pay period as soon as they do it, this allows them to put any amended tax code changes  / wage rate rise through the system for the next payrun.

HMRC's Real Time Information allows a rollback situation after the payroll data has been sent. The next Full Payment Submission will have different year to date figures.

Payroll software can of course be used for inappropriate purposes, I believe something may be coming to the courts soon.

Should cars manufactures restrict the maximum speed to 70mph? Think how much more law abiding people would be!



ShirleyM's picture

I can think of many legitimate reasons for needing it

ShirleyM | | Permalink

Clients often get things wrong! So often that we gave up doing payroll years ago and now use a bureau. It can be a nightmare sorting out the mess, so I guess the bureaus will really appreciate the simplification.

I see your point, David, but the risk has always been there.

Some people would rip off their own granny, and if they really want to fiddle they will do it anyway, no matter how easy or difficult it is. If I recall correctly, at one time there were people actually advertising on the internet that they would produce fake payslips for people!

Missing wages records / false ones

The Black Knight | | Permalink

Are common practice....HMRC never notice.....even in an enquiry !!

Don't see why this should not be available to everyone not just the crims...ha ha

Have even seen accountants make up their wage slips to support a mortgage application then the firm confirm with a reference letter.

Almost all payroll software can do this!

larryhammond | | Permalink

I agree with Andrew, "rollback" is a common feature of most payroll software. Also, most payroll software I have seen will create an individual pay frequency backup when a periodic payrun is closed. With a backup in place for every payrun, it would be a very simple  to restore from backup and amend the numbers if one really wanted to.   





Anyone with a laser printer

ringi | | Permalink

Anyone with a laser printer can do it just using MS-Word, as no one knows what a given employers payslips should look like anyway.

I love this comment and am in

masud10 | | Permalink

I love this comment and am in full agreement with the writer as its definitely not worth it

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