With all you've got going in electronic technology, isn't there a big risk of computer fraud?

An enormous risk. Stanford Research Institute maintains a catalog of all computer frauds, and it's getting pretty thick. They research every fraud that's discovered--the ones where the horse does not come home. If the horse returns and goes back in the cash drawer, of course, you never know.

There are a lot of prevention systems around. One is a black box that monitors and records every program that's run on the mainframe. It's not foolproof, but it helps. Anyway, centralized computers have gone as far as they can. We're switching to minicomputers. As our minis proliferate out to the branches so does our control problem.

The United States Air Force has done the most work on fraud prevention. They have a payroll system with a band of probability built into it. If the computer shows that ten guys at a base have been promoted to sergeant in one week, the red light goes on because the probability is for only two promotions a week. They have a crazy guy in Texas who spends all his time trying to break the system. We hired a man to do the same for us and to compare notes with the Air Force guy. Computer fraud isn't a major problem, but I have no doubt there's a lot of it around.

The best thing is to set up a good accounting system and a good control system with people looking for anything that doesn't make sense, rather than staring at all the numbers. But it is a growing risk. I agree with you.