Page 553 - ACFE Fraud Reports 2009_2020

Perpetrators

Behavioral Red Flags Based on Perpetrator’s Position
Figure 95 shows the distribution of behavioral red flags based on the perpetrator’s level of authority. The purpose of
this chart is to show how individuals at different levels within an organization might have different motivations or ratio-
nalizations for committing fraud. For instance, approximately 38% of all employee fraudsters were undergoing financial
difficulties at the time of their frauds, but this red flag was not nearly as common for higher-level perpetrators. Manag-
ers were much more likely than the other two groups to have an unusually close association with a vendor or customer,
and fraudsters at the owner/executive level were significantly more likely to have a “wheeler-dealer” attitude involving
shrewd or unscrupulous behavior.

Figure 95: Behavioral Red Flags Based on Perpetrator’s Position

44.4%
Living Beyond Means 47.2%
47.6%
Financial Difficulties 25.2% 38.1%
22.2%
Unusually Close Association 12.7%
with Vendor/Customer 21.0% 27.8%
9.7%
Wheeler-Dealer Attitude 14.8%
28.0%
Control Issues, Unwillingness 9.9% 19.1%
to Share Duties 21.0%
14.4%
Divorce/Family Problems 14.1%
11.5%
Irritability, Suspiciousness, 9.1% 15.3%
or Defensiveness 15.9%
10.2%
Addiction Problems 6.3% 8.4% 9.9%
9.9%
BEHA VIORAL RED FLA G Refusal to Take Vacations 5.0% 7.3% 8.9% 11.5%
Complained About
10.2%
Inadequate Pay
8.5%
No Behavioral Red Flags
7.6%
6.1%
Excessive Pressure from
8.0%
Within Organization
6.9%
Past Employment-
Related Problems 5.8% 7.6% 9.5%
7.3%
Social Isolation 5.2%
5.2%
5.3%
Past Legal Problems 3.7% 9.2%
4.3%
Other 4.7%
8.1%
Excessive Family/Peer 4.2%
5.2%
Pressure for Success 7.8%
Complained About 4.8% Employee
Lack of Authority 2.3% 5.5% Manager
Instability in 6.2% Owner/Executive
3.4%
Life Circumstances 2.3%
0% 5% 10% 15% 20% 25% 30% 35% 40% 45% 50%
PERCENT OF CASES

REPORT TO THE NATIONS ON OCCUPATIONAL FRAUD AND ABUSE 69