In recent weeks, we have been reading about a growing number of exam fraud cases in accountancy, both in the Netherlands and elsewhere. Accountancy is all about integrity, professionalism and responsibility. These core values not only form the basis of the profession but are also essential when taking and passing exams in this demanding field. This is precisely where we see an increasing number of accountancy organisations turning out to have a structural problem: exam fraud.

Thus, the Dutch Authority for the Financial Markets (AFM) wrote on 16 October:

The AFM is shocked about the exam fraud that is also playing out at a second major accountancy organisation at the highest level. Board member Hanzo van Beusekom wants Deloitte to carry out the investigation in depth and complete it expeditiously so that all the facts come to the surface. The AFM will follow this closely

AFM, 2023

In such cases, the question arises how an accountancy organisation should deal with this issue. Culture and associated behavioural change are cited by the AFM as both the core of the problem and the solution. While this certainly contributes and is of great importance in the longer term, it does not solve the problem in the here and now. In the short term, it is important to find out what the extent of exam fraud is and what the right response towards regulators and clients looks like.

Steps accountancy organisations can take to tackle exam fraud

The core evidence in this situation is digital material. Herein lies the key not only for your organisation to get a picture of the extent of the problem, but also to respond appropriately to regulators. If your organisation faces a potential exam fraud investigation, the following steps are important to get a handle on the situation:

1. Map out which employees have taken these exams and in which period(s) these exams were taken.
2. Map the sources of (digital) material in which there may be factual material to give interpretation to the problem.
3. Secure these sources so that they are in line with the requirements of both AFM and PCAOB. You can comply with any information requests in this case if they have not already been made.
4. Record what information has been secured. For the information that has not been secured, map out why this is not the case. Consider e-mail boxes, phones, chat and laptops.
5. Start by mapping the information and relevant periods when it should be determined whether exam fraud may have occurred.
6. Select the sources, periods and other relevant criteria to build your own fact-finding and process this information in an appropriate environment.
7. Work with a platform or environment in which structured and defensible work can be done to answer current, and future, questions from regulators. eDiscovery is an excellent tool for this. This is the process of searching, locating and securing digital data for the purpose of using it as evidence.
8. Provide concrete factual evidence to supervisors to best cooperate, understand the extent of the issues in your organisation, and deal with them appropriately. A quick and adequate response limits the damage to your organisation.
9. Ensure you have adequate policies, communication strategies and practices in place to give the problem of exam fraud the attention it needs.

How can FORCYD help?

When fraud investigations take place, it is vital to include the regulator in your approach. Make sure your considerations and approach can be well explained and coordinate with regulators where necessary.

FORCYD helps organisations conduct internal investigations to identify and address potential breaches, and respond to information requests from regulators and supervisors in a timely and efficient manner.

To learn more about how FORCYD can support your organisation on these issues, identifying facts and successfully preparing for conversations with regulators such as the AFM and PCAOB, please contact Bas Sluijsmans or contact us here. 

About the author

Bas Sluijsmans is partner at FORCYD in the Netherlands.

Bas played a substantial role in many notable global matters, ranging from banking and finance during the credit crisis, to over 15 years of experience in global corruption investigations, national parliamentary inquiries and a wide variety of industry specific investigations and cases in which digital evidence is key.