Global Economic Crime and Fraud Survey 2018 – Czech results
Pulling fraud out of the shadows
Is economic crime decreasing?
In comparison with our previous Surveys, it appears as if incidents of fraud at the Czech respondents were decreasing. 33% this year, compared to 35% in 2016 and 48% in 2014.
This is contradicting the CEE and global results that show incidents of fraud reported by the respondents have risen from 33% and 36% in 2016 to 47% and 49% in 2018, respectively.
Similar to the results from our previous Survey, asset misappropriation represents 50% of all reported fraud cases. Followed by consumer fraud (38%), procurement fraud (29%) and cybercrime (25%).
In third place both globally and in second in the Czech Republic is fraud committed by the consumer, the first time that survey respondents had the opportunity to include this type of economic crime as an answer.
Or do fraud cases remain undetected?
When it comes to fraud detection, internal and external tip-offs account for fully one third of all detected cases. At the same time, none of the survey respondents identified cases through a whistleblowing hotline. There might be various reasons for this, including but not limited to historical connotations or negative consequences for whistleblowers in past years.
There is also a notable discrepancy when it comes to technology based detection methods: while the majority of respondents claim to use a range of data based fraud detection tools, these appear not to have resulted in the identification of any of the reported fraud cases, something that is in notable contrast to results from both the wider CEE region and the rest of the world.
This might be reflected in the types of fraud identified, which are dominated by asset misappropriation and consumer fraud thatwhich are comparatively likely to be detected by less sophisticated precautions.
This suggests that Czech companies are less likely than their counterparts in other countries to detect more sophisticated fraud schemes.
An obvious question needs to be asked:
“Is there any causality between the limited use of the anti-fraud technology solutions by Czech organisations and the decreasing number of fraud cases reported by Czech corporations, a number which is significantly below the global level?”
Only 30% of the Czech companies use modern technologies to combat fraud compared to the 37% in CEE and 36 % globally.
“A key challenge with fraud detection is the dynamic nature of fraud. Fraudsters adopt and try to beat detection and prevention mechanisms by developing new methods and strategies. Therefore, adaptive analytical models and detection and prevention systems are required in order to detect and resolve fraud as soon as possible. Detecting fraud as early as possible is crucial.”
41% Czech companies were targeted by phishing attack.
It is significantly higher than the CEE (28%) and global level (33%).
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