Companies’ concerns about fraud are rising even though the number of incidents declined over the last year, according to a Kroll survey of more than 1,200 senior executives worldwide.
Half of the executives surveyed say their companies are highly or moderately vulnerable to information theft, up from 38% in 2010, while 47% cite a high or moderately high vulnerability to corruption and bribery, up from 38%, and 46% cite the theft of physical assets, up from 34%. The survey shows, though, that just three-quarters of the companies experienced some type of fraud over the last year, down from 88% in 2010.
Despite their concerns, just 27% say their companies are well-prepared to comply with the Foreign Corrupt Practices Act and the U.K. Bribery Act. Only 43% train their managers, agents and foreign employees on complying with those laws, and only 37% say due diligence on acquisitions should include assessing the potential acquisition’s compliance.
The problem starts at home, with insiders responsible for 60% of all frauds in the last year, up from 55% in last year’s survey. Twenty-eight percent of perpetrators were junior employees, according to the survey, while 21% were senior management and 11% served as the company’s agents or intermediaries.