Companies Need to Remain Vigilant in the Face of Escalating Fraud

Companies worldwide are battling to survive and grow in what have continued to be highly adverse economic conditions. In this environment, growth and ethical business conduct can sometimes appear to be competing priorities. Ernst & Young recently undertook the 12th Global Fraud Survey where they interviewed chief financial officers and heads of legal, compliance and internal audit, to get their views of fraud, bribery and corruption risk and how their organizations are mitigating them. These interviews highlighted specific risks, many of which could be missed without awareness, careful due diligence and oversight. The survey indicates that companies’ awareness of the risks posed by fraud, bribery and corruption is high, and that a substantial majority of these companies are doing many of the right things to mitigate the risks. Despite this, there remain significant weaknesses in many organizations’ responses and the use of forensic data analytics and other technology-related tools occurs too infrequently. In addition, the survey revealed that risks, instead of standards are rising, and due diligence on third parties is expected by regulators, but 44% of respondents report that background checks were not being performed.

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