Association of Certified Fraud Examiners Releases 2014 Report to the Nations

If you have any interest in learning more about white-collar crime, I highly recommend downloading the 2014 Report to the Nations on Occupational Fraud and Abuse released this week by the Association of Certified Fraud Examiners (ACFE). The report takes a close look at numerous aspects of fraud incidents worldwide. Reducing fraud requires a better understanding of the who, what, where, why and how of fraud, and this latest report provides many insights.

ACFE compiled the data for its 2014 report based on 1,483 different cases of fraud reported by Certified Fraud Examiners. Any executive, business owner or leader looking to prevent and detect fraud can benefit from a quick review of the report, which is well-organized and easy to navigate. A few key findings from the report include:

  • The typical organization loses 5 percent of its annual revenue to various forms of fraud.
  • Fraud is a global and pervasive problem, unrestrained by borders.
  • The average fraud scheme caused a loss of $145,000, with 24 percent of companies in the survey suffering a loss of $1 million or more.
  • More than 40 percent of fraud was detected by a tip, reinforcing the importance of having a fraud hotline for employees, vendors and others to confidentially report concerns. Tips detected fraud at twice the rate of any other method.
  • The median duration of a fraud scheme was 18 months.

Also worth mentioning is that small businesses continue to be disproportionately affected by fraud. This unfortunate statistic doesn’t seem to be getting any better. From my experience, small businesses tend to have fewer internal controls and concentrate duties with just a few employees whose work goes unchecked. You can learn much more about fraud by downloading the full report from the ACFE website.

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Jeffrey works with a wide variety of clients and organizations providing fraud prevention, fraud investigation, fraud risk assessments and assurance services. He has investigated allegations of improprieties in a variety of companies and organizations, including privately held companies, financial institutions, cooperatives, governmental entities and not-for-profit organizations. Jeffrey also works with clients to develop organizational procedures that can help prevent future fraudulent activity. He provides support to attorneys on litigation issues that involve accounting, auditing and other financial issues and has provided testimony in trial, deposition and grand jury settings.

Jeff Roberts – who has written posts on BKD Forensics.


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