Fraud in the Workplace!?

I'm taking a class right now, it's called "Financial Methods", basic accounting for people who do accounting within business.  I've NEVER taken an accounting class in my life so a lot of it is new to me.  I'm reading this week about the concept of  "Internal Controls" which is basically a checks and balance system within a company.  Things like: 1. Preventing fraud within a company by making sure more than one person is paying attention to the books.

2. Assessing risks before you take them

3. Setting up policies people can follow so everyone is on the same page

These kinds of things.

It's making me think about several things, the one that's at the forefront of my mind right now is FRAUD.  WHAT!?  Some of the things that the book talks about are things that could REALLY easily happen within a company.  Like the accounting dept setting up an extra employee in the system and paying them every week but paying into their own bank account.  ARE YOU KIDDING ME?

Has anyone ever heard of this actually happening?  I'm curious if these are really life things that "normal" people do.