fig. 1 countries with reported cases and median loss for ...€¦ · sales schemes bid rigging...

FIG. 1 Countries with reported cases and median loss for each region

United StatesMEDIANLOSS: $108,000

CASES: 1,000 (48%) Sub-Saharan AfricaMEDIANLOSS: $90,000

CASES: 267 (13%) Asia-PacificMEDIANLOSS: $236,000

CASES: 220 (11%)

Western EuropeMEDIANLOSS: $200,000

CASES: 130 (6%)

Latin America and the CaribbeanMEDIANLOSS: $193,000

CASES: 110 (5%)

Middle Eastand North AfricaMEDIANLOSS: $200,000

CASES: 101 (5%)

Southern AsiaMEDIANLOSS: $100,000

CASES: 96 (5%)

Eastern Europe and Western/Central Asia MEDIANLOSS: $150,000

CASES: 86 (4%) CanadaMEDIANLOSS: $200,000

CASES: 82 (4%)

Less than $200,000

$200,000–$399,999

$400,000–$599,999

$600,000–$799,999

$800,000–$999,999

$1 million or more

55%

11%

7%

3%

2%

22%

FIG. 2 How much does an occupational fraud cost the victim organization?

FIG. 3 How is occupational fraud committed?

89%

38%

10%

$114,000

$250,000

$800,000

Asset misappropriation Corruption Financial

statement fraud

PE

RC

EN

T O

F C

AS

ES

ME

DIA

N L

OS

S

Corruption

Conflicts of Interest

Cash

Theft of Cash on Hand

Theft of Cash Receipts

Fraudulent Disbursements

Inventory and All Other Assets

PurchasingSchemes

Sales Schemes Bid Rigging

Skimming Cash Larceny

Misuse Larceny

Asset Requisitions

and Transfers

False Sales and Shipping

Purchasing and Receiving

Unconcealed Larceny

Sales

Unrecorded Write-O� Schemes

Lapping Schemes

Unconcealed

Understated

Receivables Refunds and Other

Billing Schemes

Payroll Schemes

Expense Reimbursement

Schemes

Check and Payment

Tampering

Register Disbursements

Forged Maker False Voids

False RefundsForged Endorsement

Authorized Maker

Altered Payee

Mischaracterized Expenses

Ghost Employee

Commission Schemes

Overstated Expenses

Fictitious Expenses

Multiple Reimbursements

Falsified Wages

Shell Company

Non-Accomplice

Vendor

Personal Purchases

Invoice Kickbacks

Timing Di�erences

Fictitious Revenues

Improper Asset

Valuations

Concealed Liabilities and

Expenses

Timing Di�erences

Understated Revenues

Improper Asset

Valuations

Overstated Liabilities and

Expenses

Improper Disclosures

Improper Disclosures

Illegal Gratuities Economic ExtortionBribery

Net Worth/Net Income

Overstatements

Net Worth/Net Income

Understatements

Asset Misappropriation Financial Statement Fraud

FIG. 4 Occupational Fraud and Abuse Classification System (the Fraud Tree)

FIG. 5 How often do fraudsters commit more than one type of occupational fraud?

Asset misappropriation

Corruption

Financial statement fraud

Asset misappropriation and corruption

Asset misappropriation and financial statement fraud

Financial statement fraud only

Corruption, asset misappropriation, and financial statement fraud

23%

Corruption only 9%

Asset misappropriation only 57%

3%

1%

Corruption and financial statement fraud 1%

4%

FIG. 6 What asset misappropriation schemes present the greatest risk?

L E S S R I S K M O R E R I S K

Register disbursements$29,000 (3%)

Payroll$63,000 (7%)

Cash larceny$75,000 (11%)

Check and payment tampering$150,000 (12%)

Billing$100,000 (20%)

Noncash$98,000 (21%)

Skimming$50,000 (11%)

Expense reimbursements$31,000 (14%)

Cash on hand$20,000 (15%)

FIG. 7 How does the duration of a fraud relate to median loss?27%

$30,000$75,000

$125,000

$200,000

$400,000 $425,000

$500,000

$715,000

19%

10%

13%

11%

5%6%

8%

6 months or less

7–12 months

13–18 months

19–24 months

25–36 months

37–48 months

49–60 months

More than 60 months

PE

RC

EN

T O

F C

AS

ES

ME

DIA

N L

OS

S

FIG. 8 How long do different occupational fraud schemes last?

30 months

24 months

24 months

24 months

24 months

24 months

22 months

18 months

18 months

12 months

12 months

Payroll

Check and payment tampering


Expense reimbursements

Billing

Cash larceny

Corruption

Skimming

Noncash

Register disbursements

Cash on hand

FIG. 9 How is occupational fraud initially detected?

Tip

Internal audit

Management review

By accident

Other

Account reconciliation

Document examination

External audit

Surveillance/monitoring

Notified by law enforcement

IT controls

Confession

40%

15%

13%

7%

6%

5%

4%

4%

3%

2%

1%

1%

FIG. 10 Who reports occupational fraud?

Anonymous14%

Other5%

Competitor3%

Shareholder/owner2%

Employee53%

Customer21%

Vendor8%

Internal source External source Other

FIG. 11 How does detection method relate to fraud duration and loss?

0

5

10

15

20

25

30

ME

DIA

N M

ON

TH

S T

O D

ET

EC

TIO

N

IT co

ntrols

Surveilla

nce/monito

ring

Account re

concili

ation

Internal audit

Manag

ement revie

w

Document exam

ination Tip

External a

udit

By acci

dent

Confession

Notified by p

olice

$39,0005 months

$50,0006 months

$52,00011 months

$108,00012 months

$110,00014 months

$126,00018 months

$130,00018 months

$150,00024 months$250,000

23 months

Active detection method

Passive detection method

Potentially active or passive detection method $186,00024 months

$935,00024 months

FIG. 12 What types of organizations are victimized by occupational fraud?

Privatecompany Not-for-profitGovernmentPublic

company Other

$164,000

16%

42%

29%

9%4%

ME

DIA

N L

OS

S

$117,000 $118,000

$75,000

$120,000

PE

RC

EN

T O

F C

AS

ES

FIG. 13 What levels of government are victimized by occupational fraud?

38+31+26+5+F National: 38%($200,000*)

Local: 31%($92,000*)

State/provincial: 26%($110,000*)

Other: 4%($58,000*)

*Dollar amounts are median loss.

FIG. 14 How does an organization’s size relate to its occupational fraud risk?

<100 employees

10,000+employees

1,000–9,999employees

100–999 employees

$200,000

26%28%

22%24%

ME

DIA

N L

OS

S

$100,000 $100,000

$132,000

PE

RC

EN

T O

F C

AS

ES

FIG. 15 How does occupational fraud affect organizations in different industries?

17+83+R 10+90+R5+95+R

9+91+R

Insurance

Manufacturing

14%366Cases

4+96+R

7+93+R4+96+R

Education

Health care

83Cases

2+98+R3+97+R3+97+R3+97+R

Technology Religious, charitable, or social services

Services (professional)

Arts, entertainment, and recreation

4+96+R

5+95+R4+96+R

Other

Retail

Food service and hospitality

84Cases

76Cases

1+99+R1+99+R

1+99+RMining

Utilities

Wholesale trade

Telecommunications Real estateAgriculture, forestry, fishing, and hunting

4+96+R

1+99+R2+98+R2+98+R

90Cases

Construction

7%Government and

public administrationBanking and

financial services

Transportation and warehousing

4+96+REnergy

1+99+R1+99+RServices (Other) Communications and

publishing

MEDIAN LOSS:

$110,000MEDIAN LOSS:

$240,000 MEDIAN LOSS:


$100,000

212Cases

201Cases

158Cases

MEDIAN LOSS:

$50,000

MEDIAN LOSS:


$68,000MEDIAN LOSS:

$300,000

94Cases

97Cases

101Cases

108Cases

MEDIAN LOSS:


$70,000

MEDIAN LOSS:


$90,000

58Cases

60Cases

51Cases

68Cases

MEDIAN LOSS:


$90,000MEDIAN LOSS:

$258,000

MEDIAN LOSS:

$88,000MEDIAN LOSS:




$150,000

50Cases

35Cases

32Cases

29Cases

28Cases

27Cases

24Cases

24Cases

MEDIAN LOSS:

$82,000MEDIAN LOSS:



$110,000

FIG. 16 What are the most common occupational fraud schemes in various industries?

Cases Billin

g

Cash

larc

eny

Cash

on

hand

Chec

k an

d pa

ymen

t ta

mpe

ring

Corru

ptio

n

Expe

nse

reim

burs

emen

ts

Fina

ncia

l sta

tem

ent f

raud

Nonc

ash

Payr

oll

Regi

ster

disb

urse

men

ts

Skim

min

g

I N D U S T R Y

Banking and financial services

338 11% 14% 23% 12% 36% 7% 8% 11% 2% 3% 9%

Manufacturing 201 27% 8% 15% 12% 51% 18% 10% 28% 5% 3% 7%

Government and public administration

184 15% 11% 11% 9% 50% 11% 5% 22% 7% 2% 11%

Health care 149 26% 7% 13% 13% 36% 16% 11% 19% 17% 1% 12%

Retail 104 20% 10% 19% 9% 28% 8% 12% 34% 5% 13% 13%

Education 96 23% 19% 19% 6% 38% 18% 6% 19% 6% 0% 14%

Insurance 87 20% 9% 3% 18% 45% 8% 7% 11% 3% 1% 11%

Energy 86 20% 2% 10% 12% 53% 10% 3% 27% 7% 2% 10%

Construction 83 37% 12% 8% 19% 42% 23% 16% 23% 14% 1% 13%

Transportation and warehousing

79 25% 8% 8% 9% 46% 15% 8% 28% 3% 3% 13%

Food service and hospitality

75 17% 16% 20% 11% 29% 12% 12% 24% 7% 0% 23%

Technology 62 26% 5% 10% 8% 42% 21% 16% 32% 8% 0% 6%

Religious, charitable, or social services

58 40% 9% 22% 19% 34% 29% 10% 19% 22% 3% 17%

Services (professional) 54 26% 17% 15% 26% 17% 30% 13% 13% 15% 0% 15%

Arts, entertainment, and recreation

50 14% 20% 36% 6% 32% 12% 8% 18% 4% 8% 28%


FIG. 17 What anti-fraud controls are most common?Code of conduct

External audit of financial statements

Management certification of financial statements

Internal audit department

External audit of internal controls over financial reporting

Management review

80%

80%

73%

72%

67%

66%

Independent audit committee

Employee support programs

Fraud training for employees

Anti-fraud policy

Fraud training for managers/executives

Dedicated fraud department, function, or team

63%

61%

54%

54%

53%

52%

41%

41%

37%

37%

19%

12%

Hotline

Formal fraud risk assessments

Surprise audits

Job rotation/mandatory vacation

Proactive data monitoring/analysis

Rewards for whistleblowers

FIG. 18 How does the presence of anti-fraud controls relate to median loss?

Control Percent of cases

Control in place

Control not in place

Percent reduction

Code of conduct 80% $ 110,000 $ 250,000 56% Proactive data monitoring/analysis 37% $ 80,000 $ 165,000 52% Surprise audits 37% $ 75,000 $ 152,000 51% External audit of internal controls over financial reporting 67% $ 100,000 $ 200,000 50% Management review 66% $ 100,000 $ 200,000 50% Hotline 63% $ 100,000 $ 200,000 50% Anti-fraud policy 54% $ 100,000 $ 190,000 47% Internal audit department 73% $ 108,000 $ 200,000 46% Management certification of financial statements 72% $ 109,000 $ 192,000 43% Fraud training for employees 53% $ 100,000 $ 169,000 41% Formal fraud risk assessments 41% $ 100,000 $ 162,000 38% Employee support programs 54% $ 100,000 $ 160,000 38% Fraud training for managers/executives 52% $ 100,000 $ 153,000 35% Dedicated fraud department, function, or team 41% $ 100,000 $ 150,000 33% External audit of financial statements 80% $ 120,000 $ 170,000 29% Job rotation/mandatory vacation 19% $ 100,000 $ 130,000 23% Independent audit committee 61% $ 120,000 $ 150,000 20% Rewards for whistleblowers 12% $ 110,000 $ 125,000 12%

$50,000

$100,000

$150,000

$200,000

$250,000

Median loss with controls

Median loss without controls12% 20% 23% 29% 33% 35% 38% 38% 41% 43% 46% 47%

50%50%50% 51% 52% 56%

P E R C E N T R E D U C T I O N












Anti-fraud policy

Hotline

Management review


Surprise audits


Code of conduct0

FIG. 19 How does the presence of anti-fraud controls relate to the duration of fraud?


Control in place

Control not in place

Percent reduction

Proactive data monitoring/analysis 37% 10 months 24 months 58% Surprise audits 37% 11 months 24 months 54% Internal audit department 73% 12 months 24 months 50% Management certification of financial statements 72% 12 months 24 months 50% External audit of internal controls over financial reporting 67% 12 months 24 months 50% Management review 66% 12 months 24 months 50% Hotline 63% 12 months 24 months 50% Anti-fraud policy 54% 12 months 24 months 50% Fraud training for employees 53% 12 months 24 months 50% Fraud training for managers/executives 52% 12 months 24 months 50% Formal fraud risk assessments 41% 12 months 24 months 50% Rewards for whistleblowers 12% 9 months 18 months 50% Independent audit committee 61% 12 months 23 months 48% Code of conduct 80% 13 months 24 months 46% Job rotation/mandatory vacation 19% 10 months 18 months 44% Dedicated fraud department, function, or team 41% 12 months 20 months 40% External audit of financial statements 80% 15 months 24 months 38% Employee support programs 54% 12 months 18 months 33%

0

5

10

15

20

25

Median duration with controls

Median duration without controls

P E R C E N T R E D U C T I O N





Code of conduct






Anti-fraud policy

Hotline


Management review




Surprise audits

ME

DIA

N M

ON

TH

S T

O D

ET

EC

TIO

N

58%

33% 38% 40% 44% 46% 48% 50% 50%

50%50%50% 50% 54%

50% 50% 50% 50%

FIG. 20 Was a background check run on the perpetrator prior to hiring?

Yes 52%

Did the check reveal existing red flags?

No

Yes 10%

90%No 48%

FIG. 21 What types of background checks were run on the perpetrator prior to hiring?

Employment history

Criminal checks

Reference checks

Education verification

Credit checks

Other

75%

78%

50%

55%

4%

36%

FIG. 22 What are the primary internal control weaknesses that contribute to occupational fraud?

Lack of clear lines of authority

Lack of independent checks/audits

2%

Lack of employee fraud education 2%

Lack of reporting mechanism <1 %

4%

Lack of internal controls 30%

Override of existing controls 19%

Lack of management review 18%

Poor tone at the top 10%

Lack of competent personnel in oversight roles 8%

Other 6%

FIG. 23 How do internal control weaknesses vary by scheme type?

Lack of internal controls

Lack of management review

Override of existing internal controls

Poor tone at the top

Lack of competent personnel in oversight roles

Lack of independent checks/audits

29%

Other

Lack of clear lines of authority

Lack of employee fraud education

Lack of reporting mechanism

32%25%

15%

19%15%

14%

18%21%

23%

9%18%

5%

8%6%

8%

5%7%

5%

4%3%

<1%

2%3%

0%

2%2%

1%

<1%1%

Asset misappropriation Corruption Financial statement fraud

FIG. 24 How does the perpetrator’s level of authority relate to occupational fraud?

3%

$50,000

$150,000

$850,000

$189,000

44%

34%

19%

Employee Manager Owner/executive Other

PE

RC

EN

T O

F C

AS

ES

ME

DIA

N L

OS

S

FIG. 25 How does the perpetrator’s level of authority relate to scheme duration?

Position Median months to detection

Employee 12 months

Manager 18 months

Owner/executive 24 months

FIG. 26 How does the perpetrator’s tenure relate to occupational fraud?

Less than 1 year

1–5 years

6–10 years

More than10 years

M E D I A N L O S SP E R C E N T O F C A S E S

$100,000

$173,000

$241,00024%

23%

44%

9% $40,000

FIG. 27 How does the perpetrator’s tenure relate to median loss at different levels of authority?

6 years or more

5 years or less

Employee

Manager

Owner/executive

$100,000

$200,000

$125,000

$1,000,000

$672,000

$35,000

M E D I A N L O S S

FIG. 28 What departments pose the greatest risk for occupational fraud?

Department* Percent of cases Median loss

Accounting 14% $ 212,000Operations 14% $ 88,000Sales 12% $ 90,000Executive/upper management 11% $ 729,000Customer service 8% $ 26,000Administrative support 8% $ 91,000Other 6% $ 77,000Finance 6% $ 156,000Purchasing 5% $ 163,000Facilities and maintenance 3% $ 175,000Warehousing/inventory 3% $ 200,000Information technology 3% $ 225,000Marketing/public relations 2% $ 80,000Manufacturing and production 2% $ 200,000Human resources 1% $ 76,000

0% 2% 4% 6% 8% 10% 12% 14% 16%$0

$50,000

$100,000

$150,000

$200,000

$250,000


Human resources

Manufacturingand production Warehousing/inventory

Information technology

Facilities and maintenancePurchasing

Finance

OtherAdministrative support

Customer service

Sales Operations

Accounting

Marketing/public relations

Executive/upper management$729,00011%


FIG. 29 What are the most common occupational fraud schemes in high-risk departments?

Cases Billin

g

Cash

larc

eny

Cash

on

hand

Chec

k an

d pa

ymen

t ta

mpe

ring

Corru

ptio

n

Expe

nse

reim

burs

emen

ts

Fina

ncia

l sta

tem

ent f

raud

Nonc

ash

Payr

oll

Regi

ster

disb

urse

men

ts

Skim

min

g

I N D U S T R Y

Accounting 290 29% 14% 17% 30% 23% 12% 13% 7% 14% 2% 19%

Operations 266 15% 8% 15% 8% 36% 11% 4% 20% 5% 2% 11%

Executive/upper management

223 35% 14% 16% 15% 62% 29% 30% 20% 12% 3% 9%

Sales 216 10% 12% 12% 6% 34% 13% 6% 25% 2% 5% 14%

Customer service 155 5% 16% 31% 8% 19% 4% 1% 15% 3% 5% 14%

Administrative support 147 33% 7% 21% 14% 26% 22% 8% 19% 13% 3% 14%

Finance 110 17% 15% 21% 16% 37% 13% 16% 15% 6% 2% 10%

Purchasing 94 18% 5% 6% 5% 77% 10% 3% 31% 3% 2% 4%

FIG. 30 How does the perpetrator’s gender relate to occupational fraud?

$89,000

$156,000

31%

69%

Male Female

PE

RC

EN

T O

F C

AS

ES

ME

DIA

N L

OS

S

��

��

Male Female

69%

31%

92%

8%

Western EuropeCanada

United StatesMiddle East

and North Africa

Asia-Pacific

Southern Asia

Sub-Saharan AfricaLatin American and the Caribbean

Eastern Europe and Western/Central Asia

��84%

16%

��73%

27%

��88%

12%��76%

24%

��77%

23%

�� 21%

79%

��58%

42%

FIG. 31 How does the gender distribution of perpetrators vary by region?

FIG. 32 How does gender distribution and median loss vary based on the perpetrator’s level of authority?

86%

73%

58%

$50,000 $50,000

$165,000$128,000

$295,000

$1,000,000

42%

27%

14%

Owner/executiveManagerEmployee

Male Female

PE

RC

EN

T O

F C

AS

ES

ME

DIA

N L

OS

S

FIG. 33 How does the perpetrator’s age relate to occupational fraud?

15%

10%

5%

$200,000

$40,000$23,000

$100,000 $100,000

$250,000 $237,000

$480,000

$355,000

19% 19%

14%

9%

6%

3%

<26 26–30 31–35 36–40 41–45 46–50 51–55 56–60 >60

PE

RC

EN

T O

F C

AS

ES

ME

DIA

N L

OS

S

FIG. 34 How does the perpetrator’s education level relate to occupational fraud?

High school graduate or less

Postgraduate degree

University degree

Some university

47%

24%

15% 14%

$75,000

$160,000$130,000

$230,000

PE

RC

EN

T O

F C

AS

ES

ME

DIA

N L

OS

S

FIG. 35 How does the number of perpetrators in a scheme relate to occupational fraud?

��

ONE PERPETRATOR

TWOPERPETRATORS

THREE OR MOREPERPETRATORS

$74,000

$150,000

$339,000

52%

Median loss

of cases

19%of cases

30%of cases

Median loss

Median loss

FIG. 36 Do perpetrators tend to have prior fraud convictions?

Never charged or convicted (89%)

Charged but not convicted (6%)

Had prior convictions (4%)

Other (1%)

FIG. 37 Do perpetrators tend to have prior employment-related disciplinary actions for fraud?

Never punished or terminated (85%)

Previously terminated (9%)

Previously punished (6%)

Other (1%)

FIG. 38 How often do perpetrators exhibit behavioral red flags?

Living beyond means

Financial di�culties

Unusually close association with vendor/customer

No behavioral red flags

Control issues, unwillingness to share duties

Divorce/family problems

“Wheeler-dealer” attitude

Irritability, suspiciousness, or defensiveness

Addiction problems

Complained about inadequate pay

Excessive pressure from within organization

Social isolation

Past legal problems

Refusal to take vacations

Past employment-related problems

Complained about lack of authority

Excessive family/peer pressure for success

Other

Instability in life circumstances

41%

29%

20%

15%

15%

14%

13%

12%

10%

9%

7%

7%

6%

6%

6%

5%

4%

4%

3%

FIG. 39 Do fraud perpetrators also engage in non-fraud-related misconduct?

Yes 45% No 55%

Bullying or intimidation (21%)

Excessive absenteeism (14%)

Excessive tardiness (10%)

Excessive Internet browsing (7%)

Sexual harassment (4%)

Visiting inappropriate websites (4%)

Other (4%)

FIG. 40 Do fraud perpetrators experience negative HR-related issues prior to or during their frauds?

Yes 39% No 61%

Poor performance evaluations (14%)

Fear of job loss (13%)

Actual job loss (5%)

Cut in benefits (4%)

Other (4%)

Cut in pay (3%)

Demotion (3%)

Involuntary cut in hours (3%)

FIG. 41 How do victim organizations punish fraud perpetrators?

Termination

Settlement agreement

Perpetrator was no longer with organization

Permitted or required resignation

Probation or suspension

No punishment

Other

65%

12%

11%

10%

8%

6%

4%

FIG. 42 Does the perpetrator’s position affect the punishment for fraud?

72%67%44%

10%12%18%

10%12%15%

Termination

Settlement agreement

Perpetrator was no longer with organization

8%11%16%

Permitted or required resignation

8%8%7%

Probation or suspension

3%5%

12%No punishment

Owner/executive Manager Employee

FIG. 43 How often is litigation pursued against occupational fraud perpetrators?

201820162014201220102008 201820162014201220102008

22% 23% 23%23%24%22%

61%59% 58%

65%64%

69%

Referred to law enforcement

Civil suit filed

FIG. 44 What were the results of criminal referrals?

AcquittedOtherDeclined to prosecute

Convicted at trial

Pleaded guilty/no contest

53%

20%18%

7%

1%

FIG. 45 What were the results of civil suits?

OtherJudgment for perpetrator

SettledJudgment for victim

53%

27%

15%

5%

FIG. 46 Why do organizations decide not to refer cases to law enforcement?

Fear of bad publicity

Internal discipline su�cient

Too costly

Private settlement

Lack of evidence

Other

Civil suit

Perpetrator disappeared

38%

33%

24%

21%

12%

12%

4%

2%

FIG. 47 What was the primary occupation of survey participants?

Fraud examiner/investigator

Internal auditor

Accounting/finance professional

Law enforcement

Compliance and ethics professional

Risk and controls professional

External/independent auditor

Consultant

Other

Corporate security and loss prevention

Attorney

Private investigator

Bank examiner

IT/computer forensics specialist

Educator

37%

22%

9%

7%

5%

4%

4%

4%

3%

3%

1%

1%

1%

1%

<1%

FIG. 48 What was the professional role of the survey participants?

��In-house examiner

53%

Professional services firm

27%

Law enforcement

18%

Other 2%

FIG. 49 How much fraud examination experience did survey participants have?

��6–10 years 28%

5 years or fewer

22%

More than 20 years

19%

11–15 years 18%

16–20 years 13%

FIG. 50 How many fraud cases have survey participants investigated in the past two years?

5 or fewer cases (41%)

6–10 cases (20%)

11–15 cases (7%)16–20 cases (7%)

More than 20 cases (25%)

FIG. 51 What are the most common occupational fraud schemes in the Asia-Pacific region?

Corruption

Noncash


Billing



Cash larceny

Skimming

Payroll


51%

25%

17%

14%

13%

Cash on hand13%

8%

8%

7%

4%

3%

FIG. 52 How is occupational fraud initially detected in the Asia-Pacific region?

Tip

Internal audit

Management review

External audit

Other




Notification by law enforcement

IT controls

Confession

47%

16%

10%

8%

4%

By accident4%

3%

3%

2%

1%

1%

<1%

FIG. 53 What anti-fraud controls are the most common in the Asia-Pacific region?


External audit of financial statements 93% Code of conduct 87% Internal audit department 80% Management certification of financial statements 79% Hotline 74% External audit of internal controls over financial reporting 73% Management review 71% Independent audit committee 69% Anti-fraud policy 60% Fraud training for employees 59% Fraud training for managers/executives 57% Employee support programs 49% Dedicated fraud department, function, or team 42% Formal fraud risk assessments 37% Surprise audits 34% Proactive data monitoring/analysis 32% Job rotation/mandatory vacation 16% Rewards for whistleblowers 11%

FIG. 54 How does the perpetrator’s level of authority relate to occupational fraud in the Asia-Pacific region?

Employee Manager Owner/executive

30%

41%

26%

$58,000

$323,000

$1,000,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S

FIG. 55 Cases by country in the Asia-Pacific region

Country Number of cases

Australia 38Cambodia 2China 49East Timor 1Hong Kong 10Indonesia 29Japan 4Macau 1Malaysia 14Myanmar (Burma) 1New Zealand 8Papua New Guinea 1Philippines 25Singapore 17South Korea 6Taiwan 6Thailand 3Vietnam 5

Total cases: 220

FIG. 56 What are the most common occupational fraud schemes in Canada?

Corruption

Billing

Noncash


Skimming



Payroll


Cash larceny

40%

20%

18%

14%

13%

Cash on hand13%

11%

10%

6%

3%

3%

FIG. 57 How is occupational fraud initially detected in Canada?

Tip

Internal audit

Management review

Other




By accident

IT controls

32%

21%

15%

7%

6%

External audit5%

5%

4%

4%

1%

FIG. 58 What anti-fraud controls are the most common in Canada?


Code of conduct 80% External audit of financial statements 72% Internal audit department 71% Employee support programs 71% Management review 68% Management certification of financial statements 67% Independent audit committee 61% Hotline 57% External audit of internal controls over financial reporting 54% Fraud training for managers/executives 51% Fraud training for employees 51% Anti-fraud policy 44% Proactive data monitoring/analysis 38% Formal fraud risk assessments 35% Dedicated fraud department, function, or team 33% Surprise audits 28% Job rotation/mandatory vacation 15% Rewards for whistleblowers 10%

FIG. 59 How does the perpetrator’s level of authority relate to occupational fraud in Canada?


47%

27%23%

$156,000$205,000

$600,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S

FIG. 60 What are the most common occupational fraud schemes in Eastern Europe and Western/Central Asia?

Corruption

Noncash

Billing


Cash larceny

Cash on hand


Skimming


Payroll

60%

30%

15%

11%

10%

Financial statement fraud10%

9%

5%

4%

4%

2%

FIG. 61 How is occupational fraud initially detected in Eastern Europe and Western/ Central Asia?

Tip

Internal audit

Management review

By accident

Other


IT controls


External audit


40%

20%

16%

7%

6%

Account reconciliation3%

2%

2%

1%

1%

1%

FIG. 62 What anti-fraud controls are the most common in Eastern Europe and Western/Central Asia?


External audit of financial statements 95% Internal audit department 91% Code of conduct 83% Management certification of financial statements 79% Management review 76% Hotline 75% External audit of internal controls over financial reporting 75% Independent audit committee 73% Anti-fraud policy 66% Fraud training for employees 58% Dedicated fraud department, function, or team 57% Fraud training for managers/executives 56% Formal fraud risk assessments 46% Surprise audits 40% Proactive data monitoring/analysis 36% Employee support programs 27% Job rotation/mandatory vacation 17% Rewards for whistleblowers 5%

FIG. 63 How does the perpetrator’s level of authority relate to occupational fraud in Eastern Europe and Western/Central Asia?


39%

33%

28%

$28,000$155,000

$3,700,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S


Bulgaria 3Czech Republic 3Georgia 1Hungary 1Kazakhstan 4Kosovo 2Latvia 2Lithuania 1Macedonia 2Montenegro 1Poland 5Romania 11Russia 15Serbia 9Slovakia 4Slovenia 4Tajikistan 1Turkey 13Ukraine 3Uzbekistan 1

Total cases: 86

FIG. 64 Cases by country in Eastern Europe and Western/Central Asia

FIG. 65 What are the most common occupational fraud schemes in Latin America and the Caribbean?

Corruption

Noncash

Cash on hand


Skimming

Billing

Payroll




51%

22%

17%

14%

12%

Cash larceny11%

11%

9%

8%

3%

1%

FIG. 66 How is occupational fraud initially detected in Latin America and the Caribbean?

Tip

Internal audit

Management review


Other


By accident


Confession

IT controls

49%

14%

10%

5%

5%

External audit5%

5%

4%

3%

2%

1%

FIG. 67 What anti-fraud controls are the most common in Latin America and the Caribbean?


Internal audit department 89% External audit of financial statements 86% Code of conduct 81% Management certification of financial statements 73% Management review 71% External audit of internal controls over financial reporting 70% Hotline 68% Independent audit committee 61% Employee support programs 51% Anti-fraud policy 50% Fraud training for employees 50% Fraud training for managers/executives 48% Dedicated fraud department, function, or team 44% Formal fraud risk assessments 40% Surprise audits 35% Proactive data monitoring/analysis 32% Job rotation/mandatory vacation 26% Rewards for whistleblowers 6%

FIG. 68 How does the perpetrator’s level of authority relate to occupational fraud in Latin America and the Caribbean?


40% 40%

19%

$100,000$150,000

$900,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S

FIG. 69 Cases by country in Latin America and the Caribbean


Antigua and Barbuda 1Argentina 8Bahamas 3Belize 1Brazil 22Chile 8Colombia 10Costa Rica 1Curaçao 2Grenada 1Haiti 1Honduras 1Jamaica 6Mexico 29Nicaragua 3Peru 5Saint Kitts and Nevis 1Trinidad and Tobago 7

Total cases: 110

FIG. 70 What are the most common occupational fraud schemes in the Middle East and North Africa?

Corruption

Cash on hand

Noncash

Cash larceny

Billing



Payroll



49%

23%

19%

15%

15%

Skimming13%

9%

8%

4%

4%

2%

FIG. 71 How is occupational fraud initially detected in the Middle East and North Africa?

Tip

Internal audit

Management review

Other


By accident



External audit

38%

20%

16%

9%

5%

Surveillance/monitoring4%

2%

2%

2%

2%

FIG. 72 What anti-fraud controls are the most common in the Middle East and North Africa?


External audit of financial statements 93% Internal audit department 85% Management certification of financial statements 81% Code of conduct 78% External audit of internal controls over financial reporting 69% Management review 68% Independent audit committee 67% Hotline 59% Surprise audits 59% Anti-fraud policy 54% Fraud training for managers/executives 47% Fraud training for employees 47% Dedicated fraud department, function, or team 44% Formal fraud risk assessments 40% Proactive data monitoring/analysis 40% Employee support programs 33% Job rotation/mandatory vacation 23% Rewards for whistleblowers 9%

FIG. 73 How does the perpetrator’s level of authority relate to occupational fraud in the Middle East and North Africa?


41%

33%

23%

$105,000$175,000

$1,250,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S

FIG. 74 Cases by country in the Middle East and North Africa


Algeria 1Bahrain 2Cyprus 5Egypt 8Iraq 1Israel 4Jordan 10Kuwait 5Lebanon 2Oman 4Qatar 8Saudi Arabia 16Syria 1United Arab Emirates 34

Total cases: 101

FIG. 75 What are the most common occupational fraud schemes in Southern Asia?

Corruption

Noncash

Billing


Skimming

Cash on hand

Cash larceny


Payroll


62%

20%

13%

13%

12%

Financial statement fraud10%

9%

8%

7%

3%

1%

FIG. 76 How is occupational fraud initially detected in Southern Asia?

Tip

Internal audit

Management review


Other

By accident




Confession

IT controls

53%

13%

10%

4%

3%

External audit3%

3%

3%

2%

2%

2%

1%

FIG. 77 What anti-fraud controls are the most common in Southern Asia?


External audit of financial statements 90% Internal audit department 88% Code of conduct 88% Management certification of financial statements 85% External audit of internal controls over financial reporting 77% Independent audit committee 76% Management review 76% Hotline 63% Anti-fraud policy 58% Fraud training for employees 56% Surprise audits 53% Fraud training for managers/executives 53% Dedicated fraud department, function, or team 49% Employee support programs 43% Formal fraud risk assessments 42% Proactive data monitoring/analysis 35% Job rotation/mandatory vacation 25% Rewards for whistleblowers 9%

FIG. 78 How does the perpetrator’s level of authority relate to occupational fraud in Southern Asia?


31%

46%

19%

$50,000

$100,000

$350,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S

FIG. 79 Cases by country in Southern Asia


Afghanistan 6Bangladesh 3India 72Maldives 2Pakistan 13

Total cases: 96

FIG. 80 What are the most common occupational fraud schemes in Sub-Saharan Africa?

Corruption

Cash on hand

Noncash

Billing



Skimming


Payroll


49%

21%

18%

17%

15%

Cash larceny14%

12%

10%

9%

6%

2%

FIG. 81 How is occupational fraud initially detected in Sub-Saharan Africa?

Tip

Internal audit

Management review


By accident


External audit



IT controls

Confession

40%

19%

12%

7%

6%

Other4%

4%

2%

2%

1%

1%

1%

FIG. 82 What anti-fraud controls are the most common in Sub-Saharan Africa?


External audit of financial statements 90% Code of conduct 89% Internal audit department 87% Management certification of financial statements 81% Independent audit committee 73% External audit of internal controls over financial reporting 72% Hotline 70% Management review 69% Anti-fraud policy 60% Fraud training for employees 55% Fraud training for managers/executives 52% Employee support programs 50% Formal fraud risk assessments 46% Surprise audits 46% Dedicated fraud department, function, or team 43% Proactive data monitoring/analysis 40% Job rotation/mandatory vacation 25% Rewards for whistleblowers 20%

FIG. 83 How does the perpetrator’s level of authority relate to occupational fraud in Sub-Saharan Africa?


48%

36%

14%

$55,000 $73,000

$2,716,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S


Angola 3Botswana 1Cameroon 1Central African Republic 1Chad 3Congo, Democratic Republic of the 3Congo, Republic of the 1Cote d’Ivoire 5Equatorial Guinea 1Gambia 1Ghana 8Guinea 1Kenya 34Liberia 8Madagascar 2Malawi 3Mali 4Mauritania 1Mauritius 2Mozambique 1Namibia 4Nigeria 55Rwanda 1Senegal 1Somalia 2South Africa 87Sudan 1Swaziland 1Tanzania 5Uganda 11Zambia 5Zimbabwe 10

Total cases: 267

FIG. 84 Cases by country in Sub-Saharan Africa

FIG. 85 What are the most common occupational fraud schemes in the United States?

Corruption

Billing

Noncash


Cash on hand

Skimming

Cash larceny

Payroll



30%

26%

21%

17%

15%

Check and payment tampering15%

14%

11%

10%

9%

3%

FIG. 86 How is occupational fraud initially detected in the United States?

Tip

Management review

Internal audit

By accident

Other


External audit



Confession

IT controls

37%

14%

13%

9%

7%

Account reconciliation5%

5%

3%

3%

3%

1%

1%

FIG. 87 What anti-fraud controls are the most common in the United States?


Code of conduct 73% External audit of financial statements 69% Employee support programs 62% Management certification of financial statements 61% Internal audit department 60% External audit of internal controls over financial reporting 60% Management review 59% Hotline 56% Fraud training for employees 50% Fraud training for managers/executives 49% Independent audit committee 49% Anti-fraud policy 47% Formal fraud risk assessments 37% Proactive data monitoring/analysis 36% Dedicated fraud department, function, or team 35% Surprise audits 31% Job rotation/mandatory vacation 15% Rewards for whistleblowers 12%

FIG. 88 How does the perpetrator’s level of authority relate to occupational fraud in the United States?


48%

31%

18%

$50,000

$150,000

$637,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S

FIG. 89 What are the most common occupational fraud schemes in Western Europe?

Corruption

Billing

Noncash

Cash on hand




Skimming

Payroll


36%

28%

17%

15%

13%

Cash larceny8%

8%

8%

5%

4%

1%

FIG. 90 How is occupational fraud initially detected in Western Europe?

Tip

Management review

Internal audit

Other



External audit



IT controls

Confession

46%

11%

9%

6%

5%

By accident5%

4%

4%

4%

2%

2%

1%

FIG. 91 What anti-fraud controls are the most common in Western Europe?


Code of conduct 93% Management certification of financial statements 88% External audit of financial statements 88% External audit of internal controls over financial reporting 85% Management review 83% Internal audit department 80% Independent audit committee 78% Hotline 76% Anti-fraud policy 65% Fraud training for managers/executives 63% Fraud training for employees 59% Formal fraud risk assessments 53% Dedicated fraud department, function, or team 49% Employee support programs 48% Surprise audits 41% Proactive data monitoring/analysis 38% Job rotation/mandatory vacation 22% Rewards for whistleblowers 10%

FIG. 92 How does the perpetrator’s level of authority relate to occupational fraud in Western Europe?


41%

34%

18%

$90,000

$235,000

$500,000

ME

DIA

N L

OS

SP

ER

CE

NT

OF

CA

SE

S

FIG. 93 Cases by country in Western Europe


Austria 4Belgium 7Denmark 2Finland 2France 4Germany 16Greece 22Iceland 1Ireland 2Italy 8Netherlands 10Norway 2Portugal 1Spain 4Switzerland 11United Kingdom 34

Total cases: 130

fig. 1 countries with reported cases and median loss for ...€¦ · sales schemes bid rigging...

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