A majority of businesses were victimized by payment fraud in 2008, according to the Association for Financial Professionals, with the weakening U.S. economy shouldering some of the blame.
The 2009 AFP Payments and Fraud Control Survey, sponsored by JPMorgan Chase, reveals that 70 percent of organizations surveyed reported actual or attempted payment fraud in 2008.
According to the survey, organizations earning more than $1 billion a year are the most likely to be victimized, with 80 percent reporting fraud incidents. On the other hand, 63 percent of small organizations earning less than $1 billion experienced fraud. While a majority of businesses experienced fraud, fortunately 63 percent lost no money. Of those that did, the typical loss was $15,200.
Most organizations experiencing fraud in 2008 (91 percent) were victims of check fraud. Meanwhile, 28 percent reported ACH debit fraud, 18 percent reported consumer credit/debit card fraud, 14 percent of organizations were victimized by corporate cards, 7 percent reported ACH credit fraud, and 6 percent experienced wire transfer fraud.
The survey results blame the increased fraud activity in 2008 on the global recession, noting that the second half of the year outpaced the first. As a result, many organizations have adopted fraud controls such as positive pay and ACH debit blocks and filters.
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Comments
Fraud is on the uptick
Fraud is definitely on the uptick.
With the unemployment rate at its highest level in over three decades, it is clear that companies are simply trying to survive by cutting expenses and laying off workers. Individuals whose homes are declining in value and whose retirement assets have been wiped out are also trying to survive. Many are becoming desperate. It is not surprising that occupational fraud is increasing. It’s a vicious cycle where losing valuable assets to fraud may push a struggling company perilously close to insolvency which, in turn, increases the risk of fraud.
In a recent Special report on Occupational Fraud by the Association of Certified Fraud Examiners (ACFE), more than half of the Certified Fraud Examiners (CFE) surveyed said the frequency and dollar amount of fraud is increasing.
More here: http://tinyurl.com/mtgfyr