When might an investigator choose to conduct covert surveillance?

An investigator may choose to conduct covert surveillance primarily when there is a reasonable belief that observable fraud is occurring. This approach allows the investigator to gather evidence discreetly without alerting the individuals involved, which is crucial for capturing genuine behavior and activities that may confirm fraudulent activities.

Covert surveillance is a strategic choice when overt methods could lead to alerts or changes in behavior, potentially hindering the investigation. Situations involving suspected ongoing fraudulent activities necessitate stealth to document actions, interactions, or patterns that might not be captured through other investigative methods. By observing without detection, the investigator can obtain crucial evidence to support a case for fraud.

Other scenarios, such as an employee reporting suspicious behavior or routine audits, may lead to investigation, but they typically involve less immediate evidence of fraud and could benefit from other investigative techniques or approaches that do not require covert methods. Regular reviews of financial statements, while important, often deal with anomalies that may not warrant surveillance unless accompanied by behavioral signals or further indications of dishonest actions.