Professional Documents
Culture Documents
Fraud occurs every day all over the world. Some companies take an it wont happen
to us approach; others implement controls to try to keep individuals likely to
commit fraud from entering the business; and still others outsource the work of
combating fraud to external auditors. These tactics and strategies are helpful but are
limited. Companies must create lower risk environments for fraud. To do so,
organizations first must understand their own corporate ecology the
interrelations between people and their workplace and tailor controls to the
nature of those systems.
Fraud may be as old as civilization itself. Fraudulent activity was mentioned in the Code of
Hammurabi, the oldest-known surviving code of law dating to around 1772 B.C. Modern
archaeologists often unearth counterfeit coins from cities long forgotten.
According to the ACFE report, the sectors most often victimized by fraud are
banking/financial, government and public administration, and manufacturing; within these
sectors, the real estate, mining, and oil and gas industries reported the largest median
losses. However, it is important to note that fraud differs by region. While billing (financial
statement) fraud is the most common in the United States and Canada, in developing
economies such as those in Latin America and Asia, corruption is rife. Therefore, companies
operating in multiple jurisdictions must take regional differences into consideration when
devising their anti-fraud strategies.