About the ACFE

The Association of Certified Fraud Examiners is the world's largest anti-fraud organization and premier provider of anti-fraud training and education. Together with nearly 65,000 members, the ACFE is reducing business fraud world-wide and inspiring public confidence in the integrity and objectivity within the profession.

 

Based in Austin, Texas, the ACFE was founded in 1988 by preeminent fraud expert and author, Dr. Joseph T. Wells, CFE, CPA. Dr. Wells’ insight as an accountant-turned-FBI agent led to the formation of a common body of knowledge known today as fraud examination.

 

DID YOU KNOW THAT...? 

 

  • Certified Fraud Examiners estimate that organizations lose 5 percent of their revenues to fraud, according to the ACFE’s new 2012 Report to the Nations on Occupational Fraud and Abuse. Applied to the estimated 2011 Gross World Product, this figure translates to a potential global fraud loss of more than $3.5 trillion (U.S.).

 

  • The ACFE has posted the 2012 Report to the Nations on Occupational Fraud and Abuse for download on their website. The ACFE's 2012 Report to the Nations on Occupational Fraud and Abuse is based on data compiled from a study of 1,388 cases of occupational fraud that occurred worldwide between January 2010 and December 2011. All information was provided by the Certified Fraud Examiners (CFEs) who investigated those cases. The fraud cases in our study came from 94 nations — providing a truly global view into the plague of occupational fraud.

 

  • The average fraud lasts about 18 months before being detected?

 

  • Occupational fraud is more likely to be detected by a tip than by any other method. The majority of tips reporting fraud come from employees of the victim organization.

 

  • Occupational fraud is a significant threat to small businesses. The smallest organizations in our study suffered the largest median losses. These organizations typically employ fewer anti-fraud controls than their larger counterparts, which increases their vulnerability to fraud.

 

  • As in our prior research, the industries most commonly victimized in our current study were the banking and financial services, government and public administration, and manufacturing sectors.

 

  • The presence of anti-fraud controls is notably correlated with significant decreases in the cost and duration of occupational fraud schemes. Victim organizations that had implemented any of 16 common anti-fraud controls experienced considerably lower losses and time-to-detection than organizations lacking these controls.

 

  • Nearly half of victim organizations do not recover any losses that they suffer due to fraud. As of the time of our survey, 49% of victims had not recovered any of the perpetrator’s takings; this finding is consistent with our previous research, which indicates that 40–50% of victim organizations do not recover any of their fraud-related losses.

 

  • Perpetrators with higher levels of authority tend to cause much larger losses. The median loss among frauds committed by owner/executives was $573,000, the median loss caused by managers was $180,000 and the median loss caused by employees was $60,000.

 

  • The vast majority (77%) of all frauds in our study were committed by individuals working in one of six departments: accounting, operations, sales, executive/upper management, customer service and purchasing. This distribution was very similar to what we found in our 2010 study.

 

  • Most occupational fraudsters are first-time offenders with clean employment histories. Approximately 87% of occupational fraudsters had never been charged or convicted of a fraud-related offense, and 84% had never been punished or terminated by an employer for fraud-related conduct.

 

  • People who commit fraud often display warning signs. The ACFE’s new global occupational fraud study, the 2012 Report to the Nations, finds that, in 81% of cases, the fraudster displayed one or more behavioral red flags that are often associated with fraudulent conduct. Living beyond means (36% of cases), financial difficulties (27%), unusually close association with vendors or customers (19%) and excessive control issues (18%) were the most commonly observed behavioral warning signs.

 

Request your copy of the 2012 Report to the Nations on Occupational Fraud and Abuse at: http://www.acfe.com/rttn-free-copy.aspx

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Association of Certified Fraud Examiners Ottawa Chapter
P.O. Box 55118 ӏ 240 Sparks Street ӏ Ottawa Ontario K1P 1A1 
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