Page 546 - ACFE Fraud Reports 2009_2020

Perpetrators

The Impact of Collusion
Nearly half of the cases in our study involved multiple perpetrators colluding with one another to commit fraud, and the
greater the number of fraudsters involved, the higher losses tended to be (see Figure 87).

Figure 87: Number of Perpetrators—Frequency and Median Loss

$700,000 60%
52.9% $633,000
$600,000
50%
$500,000 40%
MEDIAN L OSS $400,000 $294,000 30% PERCENT OF CASES

$300,000

$200,000 17.4% $220,000 20%
$150,000
13.7% 10%
$100,000 $85,000 10.6%
5.4%
$0 0%
One Two ree Four Five or More
NUMBER OF PERPETRATORS

Median Loss Percent of Cases

One possible reason for the increase in losses associated with multiple perpetrators is that many anti-fraud controls
work on the basis of separation of duties and independent checks. When multiple fraudsters work together, they might
be able to undermine the process of independently verifying transactions or other mechanisms designed to uncover
fraud. However, when we looked at the duration of frauds (see Figure 88), we found that schemes with multiple perpe-
trators did not last significantly longer than single-perpetrator frauds, which was also true in our 2014 study. That would
indicate that collusion schemes, while more costly, were not necessarily more difficult to detect.

Another explanation for the larger losses in schemes with multiple perpetrators could simply be that with more fraud-
sters involved, the perpetrators needed to steal more because their proceeds were being split more ways. In other
words, with more perpetrators expecting a payout, the conspirators needed to steal more to satisfy everyone involved
in the crime.

Figure 88: Median Duration of Fraud Based on Number of Perpetrators

Number Median Months to Detect
One 16
Two or More 18

62 REPORT TO THE NATIONS ON OCCUPATIONAL FRAUD AND ABUSE