Why Your Business Needs to Protect Against Executive Fraud

You may trust your executive management team implicitly. But the research is clear: In organizations where executives turn to fraud, the results are very costly. According to the Association of Certified Fraud Examiners’ (ACFE’s) Occupational Fraud 2024: A Report to the Nations, owner/executive fraud makes up only 19% of all cases but has a median loss of $459,000 per incident. That compares with $60,000 per incident for non-managerial employees. Part of the reason behind such great financial losses is the fact that it generally takes longer to detect fraud perpetrated by executives (24 months vs. eight months for rank-and-file worker schemes). So the more proactive you are about preventing and detecting occupational fraud at the highest levels, the better. 3 factors You might start by considering how the...

Executive Occupational Fraud

In its 2018 Report to the Nations on Occupational Fraud and Abuse, the Association of Certified Fraud Examiners (ACFE) reported that owners and executives accounted for only 19% of all fraud cases. Yet they caused a median loss of $850,000, vs. a median of $100,000 for rank-and-file employees.  As such, they post the greatest occupational fraud risk. Executive thieves get away with more because they have greater access to assets and can more easily override internal controls. Their schemes also tend to continue for longer periods before detection — an average of two years vs. one year for non-manager employee schemes. So it’s critical to spot the signs of executive occupational fraud risk and nab these high-placed thieves. Occupational Fraud Risk: Greater authority = greater damage Traditional preventive...