With fraud scandals and crimes on the rise, here is a look at a few facts from the Association of Certified Fraud Examiners' 2002 Report to the Nation: *
It is estimated that approximately $600 billion, or about $4,500 per employee will be lost in 2002 as a result of occupational fraud and abuse. *
Organizations with fraud hotlines cut their fraud losses by approximately 50% per scheme. Internal audits, external audits, and background checks also significantly reduce fraud losses. *
The most common method for detecting occupational fraud is through tips from employees, customers, vendors and anonymous sources. The second most common method of discovery is by accident. *
The typical occupational fraud perpetrator is a first-time offender. *
All occupational frauds fall into one of three categories: asset misappropriations, corruption, or fraudulent statements. *
Over 80% involve asset misappropriations. Cash is the targeted asset 90% of the time. *
Corruption schemes account for 13% and they cause over $500,000 in losses. *
Frauds committed by employees cause median losses of $60,000, while frauds committed by managers or executives cause median losses of $250,000. When managers and employees conspire in a fraud scheme, the median loss rises to $500,000. *
The average fraud scheme lasted 18 months before it was detected.
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