Economic crime continues to remain in the forefront of corporate concern, posing a threat to fundamental business processes.
45% of organizations in the U.S. suffered from some type of fraud in the past two years, more than the global average of 37%.
More than half of U.S. organizations that experienced fraud in the last two years reported an increase in the number of occurrences.
67% of U.S. respondents indicated their organizations currently have or planned to have operations in high-risk markets, compared to only 58% of global respondents.
57% of U.S. respondents indicated their organizations pursued opportunities in markets with high-levels of corruption risk within the past 24 months, versus 38% of global respondents.
Frauds on the Rebound
24% of U.S. organizations that reported economic crime experienced accounting fraud in 2009. In 2011, this dropped to 16%. In 2014, accounting fraud increased back to 23%.
In 2014, bribery & corruption at 14% doubled from 2011 levels (7%), after dropping by more than a half since 2009 (16%).
Profiling the Perp
The external perpetrator of fraud is closing the gap on the internal perpetrator of fraud, with U.S. organizations reporting that economic crime is committed by external actors (45% of the time) almost as often as it’s committed by internal actors (50% of the time).
Most internal frauds are now perpetrated by middle management:
54% of internal frauds were committed by middle management
There’s been a rise in the number of frauds committed by middle management:
45% in 2011 v. 54% in 2014
There’s been a drop in the number of frauds committed by junior staff:
50% in 2011 v. 31% in 2014
Fraud at U.S. organizations initially detected by external measures or by accident in 2014 more than doubled from 2011 levels:
32% in 2014 v. 15% in 2011
Fraud at U.S. organizations was initially detected through external tip-offs more often than any other method.
Fraud at U.S. organizations initially detected by suspicious transaction reporting plummeted by 19%:
11% in 2014 v. 30% in 2011
Blowing the Whistle on Fraud
86% of U.S. organizations have a whistleblower mechanism, compared to only 62% of global organizations.
83% of U.S. respondents that have whistleblower mechanisms believed they were effective.
Cybercrime is here to Stay
44% of U.S. organizations that experienced fraud in the past 24 months suffered from cybercrime; and 44% of all U.S. respondents indicated they thought it was likely their organization would suffer from cybercrime within the next 24 months.
US respondents’ perception of the risks of cybercrime exceeded the global average by 23%:
71% of U.S. respondents perceived an increased risk of cybercrime over the past 24 months versus 48% of Global respondents