Imagine this scenario. The corporate headquarters for Dunlap, Inc. is located on one side of town. Operations at the headquarters include administration, human resources, marketing, and accounting (including payroll). On the other side of town is the manufacturing plant. The plant has a supervisor and a number of manual laborers. When a new laborer wants a job, they contact the plant supervisor. The new employee fills out the proper paperwork (W-4, application, direct deposit info, and I-9). The supervisor submits the paperwork to the payroll department at headquarters. The new employee works 40 hours the first week. The supervisor approves the time card and submits the time card to the payroll department. Payroll makes payment to the employee.

What is wrong with this scenario? How could employees use the employment/payroll process to embezzle money from the company? What are the corrective actions?