Definition
Red Flags are indicators, anomalies, or patterns that may suggest fraud, misconduct, or irregularities.
Context
Red flags typically arise in processes, transactions, or behavioural patterns and are a key element of fraud risk assessment, internal controls, and fraud detection methods. Individual red flags are rarely conclusive but can form a strong risk signal when combined.
Meaning
They support early risk identification and act as a trigger for further analysis and investigation.
Example
Repeated payments just below approval thresholds.
Sources
Suggested citation
wirtschaftsforensik.ch Editorial Team: "Red Flags", in: Glossary, wirtschaftsforensik.ch, https://wirtschaftsforensik.ch/glossar/red-flags/, accessed April 18, 2026.