Fraudulent manipulation of bank statements in electronic format | JS detained

[authors: Peter Davis and Sara Beretta]


Bank records are of particular interest and importance to forensic accountants and receivers because they reflect the actual financial history of an entity. In fact, bank statements can tell a powerful story.

We have identified bank statements in several of our investigations that have been electronically manipulated to reflect misleading and fraudulent statement entries. Descriptions and amounts have changed for electronic payments, such as wire transfers and debit card transactions reflected on statements. In some cases, deposits were changed to reflect larger cash inflows, and balances were manipulated in such a way that they were carried forward, helping the manipulations go unnoticed.

How Portable Document Format (PDF) files are handled

Bank and credit card statements are often downloaded by accounting staff from bank websites in PDF format, instead of receiving hard copies by mail. This practice is becoming increasingly common as businesses are encouraged to go paperless. In some cases, we found that statements were manipulated using software that deciphers opened PDF files and provides editing tools that were used to modify amounts, dates and descriptions of various transactions . The files were then converted back to PDF format.

Today, bank statements can be easily manipulated using Adobe Acrobat Pro software, which does not require converting the file to a different format. For example, imagine an employee embezzlement case in which an employee uses a company credit card for personal gain. If the employee has access to electronic statements, it would be incredibly easy to change the payee name from a department store to a less dubious provider, such as an office supply store.

Inevitably, all PDF files are editable. Even though the original PDF file is scanned as an image in bitmap format, a process known as Optical Character Recognition (OCR) allows users to convert PDF to text format. Adobe Acrobat contains an OCR function and other software is available on the Internet. Even PDF files that are not in text format can still be edited in other ways. Techniques such as using screen capture software to take an image of the document, then edit and resave it can be used to modify an electronic file.

How to Make PDFs More Secure

Some financial institutions apply security features to PDF files, which can help prevent manipulation. In our experience, this happens most often with investment accounts. In Adobe Acrobat Pro, you can check whether security features have been applied to a PDF file to determine if the document is subject to manipulation. These security features can only be removed if you know the password used to enable them. However, in our experience, most banks do not apply these simple security features to electronic statements.

The most secure PDF files can prevent users from editing a document, combining multiple files, extracting pages, copying text, and even printing the files. Although this security feature is almost never used, one wonders why a financial institution would want to prevent users from printing statements. Someone with access to the printed statements could simply scan them into PDF format and convert them to text, which would essentially eliminate all of the security features applied to the original electronic file. The PDF creator may implement password protection, but ultimately this protection may be broken.


Changes to bank statements are virtually impossible to identify without having a copy of the original bank statement to compare them. Forensic accountants and receivers should exercise caution when relying on PDF bank and credit card statements, unless they come directly from the financial institution. Specifically, there are a few things to look out for regarding reports received from other sources:

  • Look for slight differences in font types and sizes. Some banks use more obscure fonts which are difficult for basic OCR software to match.
  • Look for statements that appear to have been scanned but have been converted to text format, as these documents reflect the potential for manipulation.
  • Match the closing balances of previous statements to the opening balances of subsequent statements. It can be difficult to continue handling without error for an extended period of time.
  • Look for excessive bank charges, as these charges could indicate overdrafts despite a seemingly positive cash balance.

The ease of electronic manipulation teaches a valuable lesson. We must remember to exercise caution and stay on high alert of fraudulent schemes in the analysis of bank statements. If in doubt, consider seeking the expertise of a competent forensic accountant to recognize the distinguishing characteristics of manipulated bank statements.

Shawanda H. Saldana