Cedar Hospital Systems FraudHospital administrator Jake Rosen was recently convicted for fraud he committed against hisemployer, Cedar Hospital Systems. Over a period of six years, he allegedly made payments to adummy company for maintenance charges while simultaneously running a scheme withmaintenance contractors where he either paid them for work never performed or overpaid themfor work. The skyscraper where Jake worked was only 10 years old. Maintenance charges rosefrom $5.2 million in 1994 to $16.4 million in 2000. It was worth noting that the judge on the casequestioned whether Cedar Hospital Systems deserved less than full restitution for failing tonotice the problem. However, it was determined that federal law on restitution does not allowsuch charges, so Jake Rosen will be making monthly payments towards the alleged $8 million hestole until he makes full restitution after leaving prison. He was able to quickly repay $3.2million of the theft with assets recovered by the government, including two homes and a niceyacht. Not bad for a man who was supposed to be making $90,000 per year.1. What type of fraud(s) could be or is/are being committed (Be Specific)?2. What procedures could have been implemented to prevent this fraud?3. What procedures could have been used to detect this fraud?

Introduction to case : This case study is regarding Jake hospital administrator was convicted for…

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Understanding Business

12th Edition

ISBN:9781259929434

Author:William Nickels

Publisher:William Nickels

Chapter1: Taking Risks And Making Profits Within The Dynamic Business Environment

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What type of fraud(s) could be or is/are being committed (Be Specific)? What procedures could have been implemented to prevent this frauď? What procedures could have been used to detect this fraud?