Yemisi Izuora
About 85 percent of global companies polled for Kroll’s annual Global Fraud and Risk Report incurred a cyber incident during the past year and 82 percent of executives said their company had experienced fraud, up from 75 percent on the previous year.
Kroll said fraud, cyber and security incidents have become the “new normal” for global companies. Rising levels of fraud last year highlight the “escalating threat to corporate reputation and regulatory compliance”, it added.
In its annual survey of more than 500 executives worldwide conducted by Forrester Consulting, Kroll found that the most common perpetrators of fraud, cyber and security incidents are company insiders.
Overall, 44 percent of respondents said either current or former employees were the primary perpetrators of cyber incidents and 60 percent said employees were involved in fraud against the company.
Junior employees were found to be perpetrators in 39 percent of fraud cases, senior or middle management 30 percent, freelance or temporary employees 27 percent and former employees 27 percent.
Tommy Helsby, co-chairman of Kroll Investigations & Disputes, said: “It’s becoming an increasingly risky world, with the largest ever proportion of companies reporting fraud and similarly high levels of cyber and security breaches.”
The most common type of cyber attack was virus infestation, experienced by 33 percent of companies, followed by email-based phishing at 26 percent.
Meanwhile, 23 percent of survey respondents said data breaches resulted in loss of customer or employee data.
Every category of fraud covered by the survey increased between 2015 and 2016. Theft of physical assets accounted for the largest number of frauds at 29 percent of incidents, up from 22 percent in 2015. It was followed by vendor, supplier or procurement fraud at 26 percent, up from 17 percent in 2015.
Information theft, as the third most common fraud, was up from 15 percent to 24 percent.
Most fraud incidents (44%) were reported via whistleblowing programmes and 39 percent of frauds were uncovered by internal audit.