PREVENTING FRAUD

Written on the 16 July 2014 by David Williams - forensics director at SV Partners Brisbane

PREVENTING FRAUD HAVE you or your clients ever been the victim of a fraud? Chances are the answer is probably yes.

The 2012 KPMG biennial survey of fraud, bribery and corruption in Australia and New Zealand reported that a total of $373.7 million had been stolen from the 281 respondents to that survey over the previous two years.

This was up from the $105 million when the survey commenced in 1997.The average fraud reported was $3.08 million with an 82 per cent increase in the individual frauds that exceeded $1 million. I will be very surprised if these numbers do not increase when KPMG release its 2014 survey early next year.

BDO also conducts a biannual fraud survey, however, limited to not-for-profit sectors in Australia and New Zealand. The BDO 2014 not-for-profit fraud survey reported that while the number of frauds in the sector had fallen, the average size and total quantum had increased.

Remarkably, 90 per cent of the BDO respondents thought fraud was a serious issue for the sector but only 28 per cent believed that their organisation was at risk. Was this a naivety on the part of the 28 per cent or had they done something to mitigate their risk. The answer is probably a bit of both.

Clearly both surveys indicate that fraud is a significant and increasing issue in our region.

Bearing in mind preventation is better than cure, organisations should invest in integrated frameworks to reduce the risk of fraud.

One of the best ways to reduce the risk is to align the organisation with the Australian Standard AS 8001 – 2008 Fraud and Corruption Control. Areas of weakness can be rectified by benchmarking the organisation against the Standard and adopting the recommended controls and procedures.

The Standard recommends controls and procedure in following four broad areas:

  • Planning and resources
  • Prevention
  • Detection
  • Response
Interestingly, the areas of detection and response also act as preventative measures. For example, if an organisation has a very strong policy in place to detect fraud and actively communicates this to members of the organisation, then those members will be less likely to try their hand at fraudulently taking the organisations assets.

Similarly, if it is well known that an organisation has a zero tolerance policy and the police will be involved in even the smallest of matters, then the potential perpetrator will be less likely to take the risk of being caught and prosecuted.

I have been involved with investigations in which the perpetrators of fraud have not been prosecuted and did not even lose their jobs. This is the worst message an organisation can send to its staff members.

By putting in place an active and effective fraud prevention framework such as the ones prescribed by the Australian Standard AS 8001 – 2008 Fraud and Corruption Control, you and/or your clients can potentially save unrecoverable losses that can be many multiples of the costs of instigating the framework.


Author: David Williams - forensics director at SV Partners Brisbane

Latest News

THE STAR'S STUNNING ANSWER TO CROWN'S BARANGAROO

THE Star Entertainment Group (ASX:SGR), not to be outdone by James Packer's Barangaroo development across the ...

BRISBANE COAL TERMINAL REOPENS AFTER SHIPLOADER REPAIR

COAL loading has recommenced at New Hope's (ASX: NHC) Brisbane terminal today after repairs to its ship loader, w...

SUPERYACHTS OFFER UNTAPPED POTENTIAL AT COMMONWEALTH GAMES

SUPERYACHT Australia has devised a strategy to attract more superyachts to Queensland and capitalise on revenue op...

GDP FIGURES A 'WAKEUP CALL' FOR PARLIAMENT

THE GDP figures are an end-of-year wakeup call for Parliament about what lies ahead for the country, according to ...

Related News

HOW MCDONALD'S AUSTRALIA REDISCOVERED ITS INNOVATIVE SPIRIT

MCDONALD'S is such a ubiquitous part of the Australian landscape today that it is easy to forget how it change...

JB HI-FI IS THE GOOD GUY IN $870 MILLION ACQUISITION

ELECTRONICS giant JB Hi-Fi has formally completed its $870 million acquisition of home appliance chain The Good Gu...

ACCC ACTS AGAINST MERITON'S RIGGED REVIEWS

MERITON Property Services is under fire from Australia's main consumer watchdog, after it allegedly engaged in mi...

ACCC FIRES WARNING SHOT TO IVF PROVIDERS

IVF clinics have been put on notice by consumer watchdog, the Australian Competition and Consumer Commission (ACCC...

Contact us

Email News Update Sign Up Contact Details

Subscribe to our mailing list

* indicates required
Email Format

PO Box 2087
Brisbane QLD 4001

LoginTell a FriendSign Up to Newsletter