Business Process Mining for Internal Fraud Risk Reduction: Results of a Case Study

Abstract

Corporate fraud these days represents a huge cost to our economy. Academic literature merely concentrates on the ¯ght against external fraud, while internal fraud also represents a major problem. In this paper we discuss the use of process mining to reduce the risk of internal fraud. This suggestion results in an extension of the IFR2 framework, presented by Jans et al. (2009). Process mining diagnoses processes by mining event logs. This way we can expose opportunities to commit fraud in the process design. We present the extended IFR2 framework as a complement to the internal control framework of the COSO and apply this framework in a case company.