WHITE COLLAR CRIME STUDY - FRAUD INCREASING

A 2009 study by the Association of Fraud Examiners (AFE) found that more than 55-percent of its members conducted more fraud-related investigations in 2008 than the year before. According to the study, known offenders felt financial pressure before committing the crime.

The study also found:

* Companies tend not to report or prosecute these crimes out of embarrassment that an employee was stealing money under their own nose.

* Employees pose the greatest fraud threat in the current economy. When asked which, if any, of several categories of fraud increased during the previous 12 months, the largest number of survey respondents (48 percent) indicated that embezzlement was on the rise.

* Layoffs are affecting organization's internal control systems. Nearly 60 percent of CFEs who work as in-house fraud examiners reported that their companies had experienced layoffs during the past year. Among those who had experienced layoffs, almost 35 percent said their company had eliminated some controls, while 44.2 percent said the layoffs had no effect on controls and only 3.2 percent said their company had increased controls.

* Fraud levels are expected to continue rising. Almost 90 percent of respondents said they expect fraud to continue to increase during the next 12 months. Additionally, the fraud most expected to increase is embezzlement.

The study can be downloaded at: http://www.acfe.com/occupational-fraud/occupational-fraud.asp