Page 162 - ACFE Fraud Reports 2009_2020

The Perpetrators

Categories of Fraud Based on Department

For each case in this Report, we compared the type of scheme committed with the department in which the perpetrator
worked. The goal was to provide data that could be useful to organizations in structuring their anti-fraud controls by iden-
tifying the departments most commonly associated with certain types of occupational fraud.

Financial Statement Fraud Financial Statement Fraud
Financial statement fraud was the most costly form of
fraud. The median loss in financial statement fraud cas- Department Cases %
es was $2 million. Not surprisingly, half of the financial Executive/Upper Management 49 50.0%
statement frauds in our study were committed by execu- Accounting 17 17.3%
tive or upper management personnel. Another 17% were Sales 11 11.2%
committed by accounting employees.
Finance 8 8.2%

Corruption Purchasing 3 3.1%
Corruption schemes can be a particularly insidious form Board of Directors 3 3.1%
of occupational fraud. They generally involve collusion Legal 2 2.0%
between an employee and an outside party, and this con- Customer Service 1 1.0%
spiracy serves to undermine the victim’s controls. The me- Manufacturing & Production 1 1.0%
dian loss among cases involving corruption was $538,000
— more than three times the median loss associated with Warehousing/Inventory 1 1.0%
asset misappropriations. Human Resources 1 1.0%
Marketing/Public Relations 1 1.0%
Like financial statement fraud, corruption schemes were
most likely to be committed by executive or upper man-
agement employees. Nearly 30% of corruption cases came Corruption
from this group. Accounting and sales departments to- Department Cases %
gether accounted for another 30% of corruption cases.
Executive/Upper Management 75 27.9%
Accounting 40 14.9%
Sales 37 13.8%
Customer Service 21 7.8%
Manufacturing & Production 17 6.3%
Marketing/Public Relations 17 6.3%
Purchasing 15 5.6%
Finance 12 4.5%
Human Resources 9 3.3%
Info Tech 7 2.6%
Board of Directors 6 2.2%
Warehousing/Inventory 5 1.9%
Legal 5 1.9%
Research & Development 3 1.1%

0 ACFE Report to the Nation on Occupational Fraud & Abuse