Fraud is gaining money by deception.
It occurs in banking, the government, insurance, and in any other area involving money.
The more money involved, the higher the chances of fraud occurring.
Fraud also includes such things as money laundering and tax evasion.
Where fraud occurs there needs to be fraud investigators to set things right.
What Does a Fraud Investigator Do?
Fraud investigators take reports from many different agencies that question whether fraud has occurred.
They may examine insurance claims, arson claims, bank theft, or embezzlement.
They may work for banks, insurance companies, law enforcement agencies, or the government.
Any area that has the chance for misusing money, or gaining money illegally is subject to investigation by fraud investigators.
Duties of a fraud investigator include:
- Conducting interviews of all involved parties
- Pulling and examining financial records
- Narrowing down evidence
- Examining reports from police departments, fire agents, etc
- Locating suspected persons
- Examining the history of suspects
- Creating professional reports for authorities
How Much Does a Fraud Investigator Make?
The average salary for a fraud investigator is $72,480 a year, which is $35 an hour.
This is above the average for many occupations.
The average salaries vary greatly from a low in Tennessee of $49,590 a year to a high in New York of $112,140 yearly.
The amount of money you earn in this profession is based upon where in the nation you work, how much education you have, the amount of experience you have, and the additional skills you have acquired.
Certification, while not necessary, can also make a difference, with certified fraud investigators making an average of 17 percent more than those without certification.
Salary Information by State
| State | Employed | Avg. Annual Salary | Avg. Hourly Pay | Top 10% Annual Salary | Bottom 10% Annual Salary |
|---|---|---|---|---|---|
| Alabama | 1,110 | $74,780 | $35.95 | $138,570 | $40,150 |
| Alaska | 110 | $128,410 | $61.74 | $165,690 | $75,500 |
| Arizona | 5,260 | $90,010 | $43.28 | $127,520 | $55,000 |
| Arkansas | 520 | $60,680 | $29.17 | $129,750 | $36,310 |
| California | 11,280 | $110,320 | $53.04 | $153,210 | $73,320 |
| Colorado | 1,780 | $95,450 | $45.89 | $147,370 | $60,280 |
| Connecticut | 800 | $96,020 | $46.16 | $150,820 | $68,290 |
| Delaware | 100 | $97,490 | $46.87 | $158,930 | $58,070 |
| District of Columbia | 2,870 | $133,890 | $64.37 | $175,340 | $85,560 |
| Florida | 5,950 | $85,330 | $41.03 | $149,410 | $42,900 |
| Georgia | 4,030 | $72,000 | $34.62 | $141,090 | $39,070 |
| Hawaii | 430 | $119,290 | $57.35 | $150,740 | $94,490 |
| Idaho | 510 | $74,710 | $35.92 | $125,820 | $45,850 |
| Illinois | 2,570 | $100,140 | $48.14 | $152,980 | $62,650 |
| Indiana | 990 | $70,340 | $33.82 | $134,910 | $40,000 |
| Iowa | 390 | $81,930 | $39.39 | $133,680 | $52,350 |
| Kansas | 920 | $66,530 | $31.99 | $96,430 | $38,960 |
| Kentucky | 660 | $75,930 | $36.51 | $141,540 | $39,520 |
| Louisiana | 1,480 | $67,390 | $32.40 | $137,610 | $36,940 |
| Maine | 530 | $79,470 | $38.21 | $112,530 | $50,840 |
| Maryland | 890 | $117,800 | $56.63 | $169,120 | $59,070 |
| Massachusetts | 1,620 | $99,560 | $47.87 | $158,480 | $59,170 |
| Michigan | 1,960 | $94,540 | $45.45 | $151,420 | $63,590 |
| Minnesota | 1,550 | $82,410 | $39.62 | $122,530 | $53,900 |
| Mississippi | 930 | $58,500 | $28.13 | $117,960 | $35,000 |
| Missouri | 1,460 | $78,060 | $37.53 | $139,360 | $42,430 |
| Montana | 440 | $86,120 | $41.40 | $129,750 | $57,700 |
| Nebraska | 280 | $86,150 | $41.42 | $138,490 | $49,490 |
| Nevada | 660 | $88,130 | $42.37 | $136,050 | $53,390 |
| New Hampshire | 390 | $83,970 | $40.37 | $145,270 | $54,720 |
| New Jersey | 3,740 | $103,960 | $49.98 | $163,240 | $60,990 |
| New Mexico | 1,840 | $77,480 | $37.25 | $99,990 | $43,830 |
| New York | 9,950 | $110,390 | $53.07 | $169,100 | $61,410 |
| North Carolina | 3,060 | $66,150 | $31.80 | $122,760 | $43,400 |
| North Dakota | 370 | $80,890 | $38.89 | $129,750 | $48,030 |
| Ohio | 2,210 | $83,150 | $39.98 | $137,970 | $49,990 |
| Oklahoma | 1,010 | $70,920 | $34.09 | $125,820 | $43,260 |
| Oregon | 560 | $96,720 | $46.50 | $147,260 | $59,990 |
| Pennsylvania | 3,240 | $94,140 | $45.26 | $142,000 | $64,190 |
| Rhode Island | 390 | $90,340 | $43.43 | $140,860 | $70,160 |
| South Carolina | 1,160 | $68,170 | $32.77 | $137,610 | $40,980 |
| South Dakota | 220 | $74,700 | $35.91 | $129,750 | $46,450 |
| Tennessee | 1,820 | $74,500 | $35.82 | $133,680 | $41,880 |
| Texas | 17,890 | $82,990 | $39.90 | $129,650 | $46,550 |
| Utah | 430 | $82,320 | $39.58 | $141,540 | $43,820 |
| Vermont | 180 | $97,310 | $46.78 | $141,540 | $61,940 |
| Virginia | 3,390 | $100,010 | $48.08 | $169,120 | $48,270 |
| Washington | 1,560 | $110,620 | $53.19 | $153,340 | $74,590 |
| West Virginia | 230 | $87,670 | $42.15 | $149,410 | $41,700 |
| Wisconsin | 1,530 | $82,970 | $39.89 | $98,180 | $60,710 |
| Wyoming | 150 | $82,580 | $39.70 | $133,680 | $53,990 |
| Puerto Rico | 520 | $85,560 | $41.14 | $145,480 | $33,270 |
Annual Average Salary: Top 10 States
The top earning state in the field is District of Columbia, where the average salary is $133,890.
These are the top 10 earning states in the field:
* Employment conditions in your area may vary.
How To Become a Fraud Investigator
1. Get a Diploma
You will first need to graduate from high school or get your GED.
It is unlikely that this will be enough to enter the field of fraud investigation, but you might consider working in a bank or other financial area as you continue your schooling.
An area that many high school students don’t consider is retail.
Here you have the chance to get theft prevention skills, a sense of money and how it works, and people skills such as communication and patience.
2. Earn a Bachelor’s Degree
The majority of fraud investigators have a Bachelor’s degree.
The areas of study vary but you will want to make sure you get courses on business law, professional ethics, mathematics, finance, fraud detection, and interview techniques.
If you know what area of fraud detection you are most interested in, such as insurance bank fraud, or money laundering it won’t hurt to try to intern at a place that puts you in the proper environment for hands-on experience.
3. Get Experience
Once you get a degree, seek a position where you can get from one to three years of experience in theft prevention, finance, or fraud investigation.
While working, explore the regulations in your state to see what you need in the way of a license or certification.
Some states require that you become a licensed private investigator.
The areas you can pursue for experience are varied.
You can work in banking, law enforcement, loss prevention, or accounting.
In some cases, military experience can prepare you for a move into fraud investigation, depending on what your duties are during your service.
4. Pursue a Graduate Degree
If you wish to rise to the top of your profession and enter research or a leadership role, consider going for your Master’s degree.
This is another two years, but the pay increase and available positions make it worth the effort.
If you plan on working in a government position, a Master’s degree is a necessity.
5. Get Certified
While a few states require you to hold a private investigator’s license, certification in fraud investigation is a matter of choice.
Getting your certification, however, will increase your ability to get better positions and will give you greater opportunities for pay increases.
6. Join a Professional Organization
Several professional organizations cater to fraud investigators.
It will be beneficial for both future advancement and networking to join one of these.
In many cases, you will need to be a member to gain certification.
What Education Does a Fraud Investigator Need?
A fraud investigator needs to have at least a Bachelor’s degree.
This can be in any field related to finance and criminal justice.
You can pursue a degree in Business Administration, Accounting, Law, or Economic Crime.
You will need to take courses in Communication, mathematics, business law, professional ethics, fraud detection and loss prevention, and interviewing techniques.
Taking courses in Psychology can also be beneficial as you get an insight into the type of personality that is most likely to commit fraud.
This helps the most in prevention but can also aid in narrowing down suspects when needed.
For advanced positions, you will want to consider getting your Master’s degree in some of the same areas.
Pursuing a program designed specifically for fraud prevention is your best course of action.
This is often called Forensic Accounting.
In any case, you will need to take additional classes yearly if you want to be certified.
Licensing and Certification
There is no license specifically for fraud investigators as a degree and experience are required.
However, some states do require that you be licensed as a private investigator.
It is necessary to research what is needed in your particular state.
Certification is something you will want to consider as it will aid you greatly in gaining positions and advancing.
The Federal Law Enforcement Training Centers offer a Fraud Investigator Certificate (FIC).
There are three levels you can aim for.
A certificate that is recognized throughout the world is the Certified Fraud Examiner (CFE) offered by the Association of Certified Fraud Examiners (ACFE).
This certificate has shown that those who hold it earn on average 17 percent more than those who don’t.
It is not easy to get.
You must first become a member of the ACFE in good standing for a year.
When you apply to take the exam, you will need to provide three professional references and be judged on their point system for education and experience.
You must earn 40/50 possible points.
You will also need to have at least two years experience in Law, loss prevention, fraud investigation, accounting or auditing, or criminology.
If this application is approved, you will then face a written exam.
The exam costs $450.
The exam is in four sections.
The areas covered are Financial Transactions and Fraud Schemes, Law, Investigation, and Fraud Prevention and Deterrence.
Once you pass all four sections, you must agree to the ACFE Code of Ethics.
To keep your certification, you must also complete at least 20 professional education credits each year.
Job Outlook for Fraud Investigators
The job outlook for fraud investigators is slightly above the national average at 4.9 percent.
It is projected that this will create an additional 7,120 positions over the coming decade.
As criminals find new ways to commit fraud and current employees move on to other positions or retire, more investigators will be needed.
The positions will go first to those with higher degrees and certifications.
Should You Become a Fraud Investigator?
You need to consider several factors before committing to a career as a fraud investigator.
This includes the job satisfaction of those who are already in the profession, salary, education needed, and whether you have the skills and personality traits necessary to feel happy in this field.
Overall Satisfaction
Current employees in this profession are generally not very satisfied with the position.
They rated their overall satisfaction at 2.9/5.
This puts satisfaction in the bottom 26 percent of all professions.
One of the greatest factors in this is that those who pursue this career don’t feel that they are utilizing their full potential or doing anything meaningful with their lives.
Average Salary
The average salary for this position is very good, ranging from $24 an hour to $54 an hour.
The factors involved in this are dependent on the location of the position, the agency worked for, amount of education, certification status, and years of experience.
On average, a fraud investigator makes $72,480 a year.
This makes for a very good living wage.
Job Growth Outlook
The job growth rate is projected to be just slightly above average, at 4.9 percent.
This means that there are projected to be an added 7,100 new positions over the coming decade.
As internet crimes become more common, fraud investigators who have excellent computer analysis skills will benefit the most.
Education Duration
The educational requirements for a position in fraud investigation are relatively short.
You will be looking at at least four years of post-secondary schooling for the majority of positions.
An additional two years will be needed if you want to pursue management or research.
Yearly classes on updated procedures and laws will be necessary.
Personal Skills Needed
The personal skills necessary for the position of fraud analyst include:
- A wish to see legal rules adhered to
- Being detail-oriented
- The ability to research thoroughly
- Good interviewing skills
- The ability to remain calm when faced with pressure and ill-tempered individuals
- Patience
- Persistence
- Analytical excellence
- Having a thorough knowledge of fraud crimes
- The ability to research well
- Have good communication skills
Frequently Asked Questions
How long do you have to go to school to become a fraud investigator?
The majority of fraud investigators have obtained a Bachelor’s degree, which takes four years.
Continuing education is needed in this position, so you will always be looking at classes.
If you want to move into management, you will need an additional two years of study to obtain your Master’s degree.
What skills do you need to have to be a fraud investigator?
To be a good fraud investigator, you will need to be analytical and pay attention to details.
You will need to be adept in math and have great skills in accounting and auditing.
You will need to be patient and persistent.
Your people skills will need to be good enough to make you a good communicator and interviewer.
You will need to be able to read people and know when they are being honest or lying.
You will also benefit from having great computer skills and the ability to research.
Finally, you will need to have a wish to prevent theft and see justice done, meaning you need a well-developed sense of ethics.
Are crime fraud investigators in high demand?
The demand for crime fraud investigators is slightly higher than it is for many professions.
As the world moves more into computers, criminals are finding new ways to commit fraud.
As long as there is money, there will be a need for fraud investigators.
Over the coming decade, there are projected to be at least 7,100 new positions developed.
This doesn’t take into account the positions that will open due to people moving into other career areas or retiring.
How much money does a fraud investigator make a year?
The range of salaries for fraud investigators goes from a low of $49,590 a year in Tennessee to a high of $112,140 a year in New York.
This comes out to an average of $72,480 a year, or $35 an hour.
This is a decent salary and can be raised by gaining certification and continuing to stay updated on investigation techniques to make your skills needed.
What kind of education do you need to become a fraud investigator?
You will be looking to obtain a Bachelor’s degree but the area you choose to get this in is varied.
You can pursue business law, professional ethics, accounting, fraud detection, or criminal justice.
A degree in economics may also be considered.
Mathematic majors also have the chance to move into a fraud investigation.
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