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Payroll Fraud – Ghost employees

What is a ghost employee?

A ghost employee is someone being paid on the payroll who doesn’t actually work for the company.

Through false payroll records a fraudster can pay a ghost employee. The ghost employee may be a false person or a real individual who simply doesn’t work for the employer.

How does ghost employee fraud work?

The scheme works if:

  • the ghost must be added to the payroll,
  • timekeeping and wage rate information must be collected,
  • a pay slip must be issued to the ghost, and
  • the funds must be delivered to the fraudster or an accomplice.

How to prevent ghost employee fraud

Companies need to focus on internal controls and process improvement.

Preventing ghosts on your payroll includes:

  • Segregation of duties in the payroll function
  • Formal process for adding new/terminating employees
  • Always look into employees with no deductions for tax or PRSI/USC
  • Are the payroll records on the right paper or using the right font?
  • Check payroll listing for duplicate names
  • Check payroll listing for duplicate bank account numbers
  • Review budget variations on monthly payroll

Remember: The fraudster is only successful if they have unmonitored access.

What questions do you have?

We are happy to help. Please post your comment below or contact Lisa Byrne, Audit Manager at Cooney Carey, on 01 677 9000. Alternatively, send her an email: 

If this article helped you, please share it with other businesses.

Posted on September 12, 2017 by Lisa Byrne

3 Key Controls In A Payroll System


All businesses who employ staff must rely on a series of controls to ensure that their payroll is being accounted for correctly. Depending on the nature and size of the business these controls can range from very basic to very thorough.

Summarised below are some of the basic key controls that should be in place in a payroll system.

1. Separation of duties

Where it is practical, different stages of the payroll process should be carried out by different people. For example, the person who processes the payroll should not be Read more

Posted on April 3, 2017 by Cooney Carey

PRSI For Spouse Or Civil Partner Of Self-Employed Individual

couple working together

The Social Welfare and Pensions Act 2014 provides that PRSI class S now includes the spouse or civil partner of a self-employed person where he/she participates in the business, performing the same or ancillary tasks, but not as a partner or an employee.

This is subject to the annual income threshold of €5,000 that currently applies to self-employed contributors under PRSI Class S.

Previously a spouse or a civil partner of a self-employed person did not make any PRSI contributions and were not insured for any benefits.

What Questions Do You Have?

We are happy to help. Please post your comment below or call Mary Flanagan on 01 677 9000. Alternatively, send us an email:

To keep in touch, connect with our friendly team on LinkedIn.

If this article helped you, please share it with other businesses.

Posted on November 26, 2015 by Mary Flanagan

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