Companies lack adequate anti-fraud staff and resources and are seen as more likely to fall prey to fraud than in the past, according to a new report.
The report, released Thursday by the Association of Certified Fraud Examiners at a Fraud Risk Management Summit in New York, polled 886 ACFE members and found that 49 percent of the respondents believe their organizations are more vulnerable to external frauds now than in the past, compared to 38 percent of respondents who note the same about occupational fraud.
Meanwhile, 58 percent of organizations currently have inadequate levels of anti-fraud staffing and resources, according to the respondents.
“Without adequate resources or staff, fraud examiners are limited to how much they are able to sufficiently investigate and stop fraud,” said ACFE President and CEO Bruce Dorris in a statement. “Each day that a fraud scheme is able to continue, the victim organization is losing money to a situation that could likely be prevented.”
Embezzlement is a common form of fraud, with 72 percent of teams frequently or occasionally investigate employee embezzlement, making it the most common type of fraud investigated.
Fraud investigators in the insurance industry have the largest caseload, with an average of 17 cases at any given time, while those in the mining industry have the smallest average caseload of two cases. Organizations in the government and public administration sectors typically have the longest fraud investigations, with teams taking an average of 94 days to close a case.
Companies are aiming to beef up their efforts to beat back fraud, with 60 percent of the respondents polled saying their organizations expect to increase their investments in anti-fraud programs in the next two years. However, 15 percent of the organizations in the survey typically don’t recover any of their funds lost to fraud, while another 64 percent recover less than half of their losses, according to the report.
“It is important to benchmark current anti-fraud efforts globally, across industries and within organizations of different sizes in order to get a holistic picture of how organizations are tackling fraud,” Dorris stated. “This data allows organizations to evaluate the effectiveness and efficiency of their anti-fraud initiatives, as well as to identify areas for improvement, expansion or investment.”