Only 12% of frauds are committed by previous fraudsters. Most frauds are committed by apparently honest employees.
The median recovery cost among victim organizations is only 20% of the original loss. Almost 40% of victims recover nothing.
Fraud is committed:
ª 41.8% in private companies
ª 30.3% in public companies
ª 15.8% in government
ª 12.2% in not for profit organizations
46% of frauds committed are towards small companies that employ fewer than 100 people.
Typical US organization loses 6% of its annual revenue to fraud
| Initial Fraud Detection
ª Tip – 39.6% ª Internal Audit – 23.8% ª By Accident – 21.3% ª Internal Controls – 18.4% ª External Audit – 10.9% ª Notified by the police – 0.9%
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Tips
ª 60% from employees ª 20% from customers ª 16% from vendors ª 13% from anonymous sources
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3 Major Categories
ª 92.7% – Asset Misappropriation – involves the theft or misuse of an organization’s assets
ª 30.1% – Corruption – procuring a benefit for themselves or another person, contrary to their duty to their employer or the rights of others
ª 7.9% – Fraudulent schemes – falsification of an organization’s financial statements
Cash Fraud
ª 74.1% Fraudulent disbursements – false invoices, forging cheques
ª 28.2% Skimming – cash is stolen before it is recorded on the books
ª 23.9% Cash Larceny – cash is stolen after it is recorded
| Age = Fraud
ª >60 – 2% ª 51-60 – 15.1% ª 41-50 – 32.0% ª 36-40 – 16.2% ª 31-35 – 18.0% ª 26-30 – 10.7% ª <26 – 5.9%
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Education = Fraud
ª High School or less – 49.5% ª Bachelor Degree – 41.5% ª Postgraduate – 9.1%
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# of Perpetrators
ª One – 65.1% ª Two or more – 34.9%
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Source: ACFE Report to the Nation on Occupational Fraud and Abuse
