What does the term "payroll fraud" typically refer to?

The term "payroll fraud" encompasses a range of dishonest activities aimed at manipulating the payroll system for personal gain. It typically includes stealing from payroll accounts, which can involve unauthorized withdrawals or transfers. Additionally, it often entails manipulating employee wages or data, where an individual may inflate their salary or alter hours worked to receive more compensation than they are entitled to.

Creating ghost employees is another common form of payroll fraud, where fictitious employees are added to the payroll system. The fraudster can then receive payments for these non-existent employees, diverting funds to their personal accounts.

Given the broad scope of payroll fraud, which includes all these actions, the most comprehensive and accurate definition is "all of the above." This encapsulation acknowledges the various methods by which payroll fraud can manifest, highlighting the importance of rigorous internal controls to detect and prevent such fraudulent activities.