Introduction: Overview of Major Types of Fraud and Corruption

Corruption is defined as “the misuse of power to obtain an unlawful advantage” (Hetzer, 2012, p. 228). Corruption can be found in all sectors of a society, including government agencies, businesses, corporations, educational institutions, medical institutions, professional groups, such as doctors and lawyers, religious organizations, and private citizens. Corruption can be manifested in many ways, including bribery, extortion, intimidation, kickbacks, theft, and other forms. Some criminals, such as leaders of organized criminal groups, depend on corrupting government officials, business leaders, or bankers to facilitate their criminal activities related to drug and human trafficking, prostitution smuggling, money laundering, and other crimes.

Hetzer, (2012, p. 228) states, “In principle, corruption is a situation in which a person who is responsible for performing certain duties pursues improper or unfair advantage for performing certain duties, or pursues improper or unfair advantage for actions or omissions in the performance of those duties.”

As with corruption, fraud can be carried out in a variety of ways, including social security and insurance fraud, home repair fraud, financial frauds, and other types. The victims of fraud can be individuals, organizations, businesses, or government agencies. Frauds committed by large organizations can result in the loss of hundreds of millions of dollars, as in a fraud pertaining to a housing development, or in the loss of a few dollars, such as when a street merchant sells defective pieces of jewelry.