Association of Certified Fraud Examiners’ latest Report to the Nations
The failure of the last Labour government to close the gap between those that have and those that have not is nowhere better illustrated than in the Association of Certified Fraud Examiners’ latest Report to the Nations. “Frauds committed by owners and executives were more than three times as costly as frauds committed by managers, and more than nine times as costly as employee frauds.” Even in crime, the rich are getting richer while the poor remain poor.
But fraud is big, big business. From the Executive Summary:
- Survey participants estimated that the typical organization loses 5% of its annual revenue to fraud. Applied to the estimated 2009 Gross World Product, this figure translates to a potential total fraud loss of more than $2.9 trillion.
- The median loss caused by the occupational fraud cases in our study was $160,000. Nearly one-quarter of the frauds involved losses of at least $1 million.
- The frauds lasted a median of 18 months before being detected.
- Asset misappropriation schemes were the most common form of fraud in our study by a wide margin, representing 90% of cases — though they were also the least costly, causing a median loss of $135,000. Financial statement fraud schemes were on the opposite end of the spectrum in both regards: These cases made up less than 5% of the frauds in our study, but caused a median loss of more than $4 million — by far the most costly category. Corruption schemes fell in the middle, comprising just under one-third of cases and causing a median loss of $250,000.
$2.9 trillion is a figure almost beyond comprehension. That’s even more than the National Debt. But then again, the last Labour government was the biggest political fraud in history anyway.