Fraudulent Opportunity Abounds: Are You Prepared?

The Insider Threat

A staggering number of internal perpetrators, often from middle management and operational staff, have been found to commit fraud with ease. According to a recent survey, 38% of respondents believed the main perpetrator of an economic crime incident was an internal actor.

The Bangladesh Cyber Heist: A Prime Example

The Bangladesh cyber heist in 2016 is a prime example of how internal perpetrators can wreak havoc on an organization. The incident resulted in RCBC being fined a record PHP 1 billion (approximately USD 19.17 million) and a branch manager sentenced to four to seven years in prison for money laundering.

What Sets Internal Perpetrators Apart

So, what sets internal perpetrators apart from external ones? For starters:

• They often have greater access to sensitive information
• They have more direct control over systems
• They may use their authority and superiority to cover their tracks

According to PwC’s 2020 Global Economic Crime and Fraud Survey, hackers are becoming increasingly prevalent as external perpetrators, with 24% of respondents citing them as the main perpetrator of an incident.

Prevention is Key

But what can be done to prevent these incidents? For starters:

• Organizations must strengthen internal controls
• Introduce new technologies to fight fraud
• Upskill employees in digital trends

A recent Microsoft Asia Workplace 2020 study found that only 14% of respondents introduced new technologies to fight fraud, while 47% reported inadequate actions to upskill employees.

Swift and Effective Response Plan

In the event of an incident, it’s crucial to have a swift and effective response plan in place. This includes:

• Conducting fact-finding investigations
• Mobilizing resources
• Bringing relevant stakeholders into the loop

Staying Ahead of the Game

As we enter a new decade, it’s clear that fraudsters are evolving and adapting to new technologies. Are you prepared to keep up with them?