When fraud happens, it is never out of the blue. The signs are always there, ignored, excused, or misread. As an internal investigator and strategist, I have seen organizations lose billions simply because no one asked the obvious question.
Let me break it down. Fraud does not start with fake invoices or missing cash. It starts with silence. With people minding their own business while corruption blossoms in plain sight. Below are the telltale signs to note.
1) Living beyond means
(i) A junior staff member suddenly drives a brand-new car.
(ii) A modest salary earner starts vacationing in Dubai with the whole family. Not Jinja. Not Fort Portal. But to Dubai. Emirates. Burj Khalifa. Floating breakfast. All in full HD on their WhatsApp status.
(iii) Let us be honest. You know your colleague’s payslip. You all queue at the same salary office. Then out of nowhere, this person shows up driving a car whose logbook is allergic to salary loans. He says it is “God’s blessing.” Yet even God is whispering, “My child, do not drag me into this one.”
When you see lifestyle levitate while the pay grade remains grounded, do not clap. Do not borrow style. Ask: What is funding this miracle?
Because when fraud happens, the red flag is not the theft. It is the silence and side-eyes from colleagues who pretend not to notice. And by the time HR wakes up, the car is sold, the Dubai album is complete, and the audit trail is colder than your office tea.
I always tell people that do not envy what you do not understand. Fraud always looks like success until the handcuffs come.
2) Unwillingness to take leave
(i) Fraudsters guard systems like gold mines. You would think their password is their blood type.
(ii) They fear exposure, not sunburn. If someone else logs in while they are away, the secrets start coughing.
(iii) When someone refuses annual leave for five years straight, claiming they “just love working,” do not applaud. Raise the alarm.
Let me paint you a picture. Peter in Accounts has not taken leave since Museveni last reshuffled the cabinet. Every year, HR begs him: “Please go and rest.” He smiles, declines, and somehow still gets his leave allowance.
But here is the trick: Peter is not hardworking. He is hard to hide.
His Excel sheets have more formulae than a PLE math paper. He reconciles his books, approves his payments, and sends his audit responses.
Ask to sit at his desk? “Ah, boss, my work is a bit sensitive.”
Sensitive indeed. The last guy who insisted on relieving him? Transferred to stores.
When a staff member treats leave like a death sentence, they are not loyal. They are laundering.
Remember, everyone needs rest. But a fraudster? They can not afford it. Their scheme collapses the moment someone else logs in.
Audit tip: If someone resists delegation like it were a crime, check. It probably is.
3) Over-familiarity with vendors
(i) Personal friendships become procurement shortcuts. “I know a guy,” they say, and that guy always wins.
(ii) One supplier keeps getting the deals even when they quote higher, deliver late, or write invoices like riddles. Why? Because he buys the drinks and sometimes the fridge too.
(iii) That “drink after work” culture? It is not networking. It is onboarding into a kickback scheme.
Let us unpack this.
Meet Sharon from procurement. Friendly. Efficient. Always available. Her best friend, Brian, owns “B-Tech Supplies.” Every tender? He wins. Every evaluation? He scores 98%.
One time, his quote arrived in PowerPoint instead of Excel. Still awarded.
Why? Because Sharon and Brian have a rhythm. You will find them every Friday at Cayenne laughing like business is a comedy. But what is not funny is how B-Tech delivers reams of paper that vanish faster than the toner.
Ask Sharon for a justification report, and she replies, “Trust me, Brian is reliable.”
That’s not due diligence. That is due to fraud.
Real suppliers compete. Fake ones collude. If one vendor keeps winning while everyone else is just ‘for formality,’ you are not running procurement. You are hosting a reunion.
Friends do not let friends win tenders. At least not without proper evaluation, clear documentation, and a firewall between social life and supplier lists.
Because when vendors and staff are this cozy, what is being supplied is not just stationery. It is a scandal.
4) Excessive control over processes
(i) One person handles everything: initiation, approval, reconciliation.
(ii) That is not efficiency. That is fraud in stealth mode.
(iii) Segregation of duties exists for a reason.
Now, meet Sarah. The finance admin at a vocational institute in Wakiso. On paper, she was a miracle worker. Initiated payments, approved them, updated the ledger, and even printed the cheques herself. The Principal used to praise her: “Sarah is very reliable. Does not disturb anyone.”
Exactly. Because disturbing people brings witnesses.
When the internal auditor finally got access to her files, they found something strange. The same stationery supplier had invoiced the same items four times in a quarter. Toner. A4 paper. USB flash drives. Same descriptions, same amounts, just different invoice numbers.
Turns out, Sarah had been processing and paying ghost suppliers. But since she reconciled the books herself, it always looked clean. Until a sick day exposed her empire. A colleague covering for her asked one innocent question: “Why are we paying UGX 4 million for ‘flash disks’ every month?”
That is when the curtain dropped.
The fraud had been running for 3 years. Estimated loss? UGX 212 million.
One-person processes are not a strength. They are a system failure.
Segregation of duties is not a bureaucratic nuisance. It is your first line of defense.
When one person controls every step, audit trails vanish, checks collapse, and fraud moves in quietly, confidently, and with receipts.
5) Missing or suspicious documentation
(i) Ghost receipts.
(ii) Repeated ‘lost’ files.
(iii) Frequent ‘technical errors’ in audit trails. Classic cover-up tactics.
Now let me tell you what they never teach in procurement school: Fraudsters are not lazy. They are creative. Especially with paper.
In one case we investigated at a municipal council in Eastern Uganda, a voucher showed the purchase of 12 laptop bags, yet no laptops. When we asked where the receipts were, the officer replied, “The machine at the supermarket jammed.” For six months straight?
Another time, a file “disappeared” a week before the audit. The same file resurfaced during internal investigations, with fresh signatures in blue ink on a document dated last year. Ghosts must be working overtime.
And do not get me started on technical errors.
The moment audit requests access to system logs, the server goes down.
Twice a month.
On Tuesdays.
Like clockwork.
They say it is a glitch. I say it is a strategy.
Every fraud has paperwork. When the paperwork disappears, it is not an accident. It is tampering. When receipts look too clean, files too empty, and systems too ‘sick’ to cooperate, you are not facing inefficiency. You are facing a cover-up.
Fraud does not always shout. Sometimes it deletes.
If documents keep vanishing, the money has already been spent.
And if no one is asking questions, the fraudster is already planning the next “glitch.”
6) Complaints of financial stress
(i) Desperation drives theft.
(ii) Employees battling loans, gambling, or the black market often rationalize fraud.
(iii) It starts “just this once” until it becomes a habit.
Let me take you into a real case.
Ronald worked in logistics. Soft-spoken. Always early. Then one day, he asked HR for a salary advance for the third time in two months. “My child is sick,” he said. The company obliged. Two weeks later, another request. This time, school fees. A month later, boda guys started showing up looking for him. “He borrowed money, boss.”
That is when the dominoes started falling. A delivery that was marked ‘received’ on paper never arrived. He had colluded with the supplier to sign off goods that went straight to his cousin’s retail shop in Kikuubo. Value? UGX 47 million. Just like that.
His explanation? “I was under pressure.”
That is the fraudster’s gospel.
It does not begin with evil intent. It begins with financial suffocation. The bank loan is due. The child needs fees. The betting app keeps calling. And so, “I will just take this small amount and return it next month.” But next month never comes. The hole only gets deeper.
(i) They do not see it as theft.
(ii) They see it as survival.
(iii) And that is what makes it so dangerous.
Be human, but do not be blind. When an employee is always broke, do not just offer sympathy. Offer scrutiny.
Because the person most desperate for help today may be the headline on your audit report tomorrow.
7) Secretiveness or defensive behavior
(i) “Why do you want to see that?”
(ii) “That’s above your grade.”
(iii) Transparency resists fraud. Secrecy breeds it.
In one district hospital, the stores officer, let us call him Mr. K, ran the medical supplies store like a personal shrine. No one could enter. Even the procurement officer needed an “appointment” to check stock. Every time someone asked for a delivery note, he replied, “That’s confidential. Talk to the director.”
One day, an intern pharmacist accidentally opened the wrong storeroom and found boxes labelled as “expired,d,” only to realize they were the current stock. That triggered a full audit. The loss? UGX 327 million in fake orders and expired drugs repackaged with new labels.
When asked why he refused oversight, Mr. K said, “You can not trust everyone in this place.” Classic fraudster deflection:n blame others, stay vague, act offended.
Here is the psychology:
(i) Fraudsters fear light.
(ii) They build empires of silence.
(iii) Every question feels like a threat, so they answer with attitude.
Statements like “you are not authorized” or “that’s above your grade” are not about hierarchy; they are about hiding something.
The truth is, in a clean system, questions are welcome.
Only in corrupt ones are they treated as insubordination.
Do not be fooled by confidence or seniority.
If someone gets defensive over routine checks, it is not just ego. It is evidence.
Transparency is a mirror. If someone avoids it, it is because their reflection can not be trusted.
If you see something, do not wait. Speak up quietly, professionally, through your internal reporting channel or to the Risk/Compliance team.
You are not a snitch. You are a custodian.
The longer red flags are ignored, the more expensive they become.
Do not let your silence fund someone’s fraud.
