Executive summary
Insider fraud is more common than many might think. Accounting abuses, egregious business practices, vendor favoritism, bribery and corruption are just some of the wrongdoings that have come to light over the course of 2023.
Yet while corporate fraud cases are on the rise, the percentage of those reported has declined. In fact, the true incidence of insider fraud is thought to be massively underreported.
When high-profile fraudulent acts come to light, it's often surprising how long the misdeeds have gone unnoticed and unchallenged.
Among the trends to watch out for in 2024 is the growing sophistication of artificial intelligence (AI)-leveraged social engineering attacks and the rise in fraud related to supply chains and environment, social and governance (ESG).
Meanwhile, regulatory pressures are growing. Supervisors are introducing new rules, with a greater onus on companies to tackle crime within their midst.
Insights
- Corporate fraud is thought to erode 1.6% of equity value annually.*
- There's typically a time lag between a fraudulent act being perpetrated and the crime being discovered, with the true impact of crimes committed in lockdown only now coming to light.
- The onus is on companies to maintain strict anti-fraud controls. Supervisors are introducing new rules, requiring companies to do more to tackle crime in their midst.
- Trends to watch for include more sophisticated, AI-driven social engineering, ESG and supply chain fraud.