Wielding Benford’s Law to find fraud

Benford’s Law is a long-standing statistical precept that remains as relevant in fighting fraud as ever. The premise is that, in sets of random data, multidigit numbers beginning with 1, 2 or 3 are more likely to occur than those starting with 4 through 9. But crooks don’t necessarily know this. When manipulating financial data, they typically choose a relatively equal distribution of numbers beginning with 1 through 9. Experts can use complicated software programs based on Benford’s Law to examine huge amounts of data and find discrepancies. However, the law isn’t always appropriate. Contact us for more information.