© D.L. Crumbley
Two Major Types of Fraud Investigations
Reactive: Some reason to suspect fraud, or occurs after a significant loss.
Proactive: First, preventive approach as a result of normal operations (e.g., review of internal controls or identify areas of fraud exposure). There is no reason to suspect fraud. Second, to detect indicia of fraud.
Source: H.R. Davia, “ Fraud Specific Audting,” Journal of Forensic Accounting, Vol. 111, 2002, pp. 111-120