Sneak Peek: New Report to the Nations Takes Fraud’s Temperature Worldwide

 New Report out May 20 at ACFE.com/RTTN.

New Report out May 20 at ACFE.com/RTTN.

GUEST BLOGGER

Scott Patterson, CFE
ACFE Senior Media Specialist

Small businesses (those with fewer than 100 employees) still bear the brunt of fraud’s damaging effects. They are more often the victims of fraud cases than larger organizations, and their financial losses are disproportionately high. Another fraud fact: two out of three perpetrators are men, a persisting gender gap that shows no sign of closing.

These and other insights are detailed in the ACFE’s newly published 2014 Report to the Nations on Occupational Fraud and Abuse. The Report is based on data compiled from a study of 1,483 cases of occupational fraud that occurred worldwide between January 2012 and December 2013. All information was provided by the Certified Fraud Examiners (CFEs) who investigated those cases. The fraud cases in our study came from nearly 100 nations, providing a truly global view into the plague of occupational fraud.

A few of the other findings in the 80-page Report:

  • Fraud schemes are extremely costly. The median loss caused by the occupational fraud cases in the study was $145,000. More than one-fifth of these cases caused losses of at least $1 million.
  • Schemes can continue for months or even years before they are detected. The frauds in the study lasted a median of 18 months before being caught.
  • Tips are key in detecting fraud. Occupational fraud is more likely to be detected by a tip than by any other method. The majority of tips reporting fraud come from employees of the victim organization.
  •  Occupational fraud is a global problem. Though some findings differ slightly from region to region, most of the trends in fraud schemes, perpetrator characteristics and anti-fraud controls are similar regardless of where the fraud occurred.

Since the inception of the Report in 1996 (originally titled The Wells Report), the ACFE has released seven updated editions — in 2002, 2004, 2006, 2008, 2010, 2012, and the current version in 2014. Like the first Report, each subsequent edition has been based on detailed case information provided by Certified Fraud Examiners (CFEs).

With each new edition of the Report, the ACFE adds to and modifies survey questions in order to enhance the quality of the data. This evolution of the Report to the Nations provides a more meaningful statistical picture drawn from the experiences of CFEs and the frauds they encounter.

Download the Report at ACFE.com/RTTN on May 20.