NCJ Number
178813
Journal
White Paper Volume: 13 Issue: 5 Dated: September/October 1999 Pages: 27-42
Editor(s)
Dick Carozza
Date Published
October 1999
Length
4 pages
Annotation
The fraud risk management field in Europe, and particularly in the United Kingdom, is quickly gaining momentum as many corporations are recognizing how white-collar crime adversely affects their profits.
Abstract
To assess the extent of fraud and response to it in Europe, a survey was conducted in which 2,000 surveys were distributed in 1998 to members of the Association of Certified Fraud Examiners and Business Defense Limited. Slightly over 200 responses were received, and 90 percent of respondents were from the United Kingdom. The incidence of inventory fraud increased with organizational size. Smaller organizations seemed to be quicker at discovering fraud, and fraud awareness was influenced by organizational size. Within organizations, internal audit, finance, and security departments were principally responsible for fraud risk management. Fraud perpetrated by corporation executives had a higher loss value than fraud perpetrated by middle managers. Bankers indicated that 60 percent of fraud cases were discovered within 6 months. In comparison with the United Kingdom, the rest of Europe felt technology played a greater role in combating fraud. Internal collusive fraud was less prominent in the United Kingdom than in the rest of Europe. Overall, the largest group of perpetrators involved those working alone inside the organization. Fraud occurred primarily because of circumventing or overriding internal controls, failing to separate duties, and failing to make periodic checks. The most common corruption fraud involved bribery and kickbacks. Most organizations indicated that fraud management methods should be under constant review, that fraud awareness levels should be raised, and that measures should be implemented to minimize fraud susceptibility. 6 exhibits