LONDON - COMPANIES for the first time report they are losing more through electronic theft of data than physical stealing of assets, risk consultancy Kroll said on Monday in an annual report on international fraud trends.
Fraud was most often an 'inside job' carried out by a company's own employees, the poll of more than 800 senior executives worldwide showed. Worries over fraud were deterring many companies from expanding in some key emerging markets.
China appeared the key emerging market with the highest level of fraud, with 98 per cent of businesses affected. This was followed by Colombia with 94 per cent and Brazil with 90 per cent.
The 2010 study showed the amount lost by businesses to fraud rose to US$1.7 million (S$2.2 million) per billion dollars sales worldwide from US$1.4 million a year earlier, the report said - although this might in part be due to better detection and awareness.
'How much fraud there is depends more on opportunity than anything else,' Tommy Helsby, Kroll chairman for Europe, Middle East and Africa, told Reuters. 'Much more work is done electronically, and that creates new opportunities for fraud. It takes time for companies to catch up with that.' Previous Global Fraud Reports showed physical theft of cash, assets and inventory as the most widespread form of fraud by a considerable margin. This year's findings showed electronic and information theft at 27.3 per cent of total fraud losses, marginally above physical theft at 27.2 per cent.
Information-based industries particularly financial services had by far the highest level of electronic theft followed by professional services and then technology, media and telecoms. -- REUTERS