Kroll Global Fraud Report

Current Report

2016/17

Fraud, cyber, and security incidents are now the "new normal" for companies across the world...

Press Release

Building Resilience in a Volatile World

January 17, 2017

82% of executives surveyed worldwide experienced a fraud incident in the past year compared to 75% in 2015, according to the Kroll Annual Global Fraud & Risk Report.

Cyber incidents were even more commonplace, with 85% of executives surveyed saying their company has suffered a cyber incident over the past 12 months.

Over two-thirds (68%) reported the occurrence of at least one security incident over the course of the year.

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The Prevalence of Fraud

The panels on the map summarize the percentage of respondents per region or country suffering at least one fraud incident in the last 12 months, and the top areas and drivers of most frequent fraud in each region or country.

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United States

The U.S. was the only country where IP theft was the most common type of fraud reported. Information theft, loss, or attack was the second most mentioned type of fraud impacting companies in the U.S., followed by conflicts of interest in the management team.

80% Experienced fraud
 
27% IP theft (e.g. of trade secrets), piracy, or counterfeiting
 
24% Information theft, loss, or attack
 
24% Management conflict of interest
 
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Canada

34% of respondents from Canada cited theft of physical assets or stock, above the global average of 29%. Information theft, loss, or attack was the second most prevalent type of fraud in Canada, mentioned by 32% of respondents compared to the global average of 24%.

88% Experienced fraud
 
34% Theft of physical assets or stock
 
32% Information theft, loss, or attack
 
32% Regulatory or compliance breach
 
32% Vendor, supplier, or procurement fraud
 
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Mexico

The striking detail to take away from the survey of companies in Mexico is the frequency of vendor and supplier fraud, which at 52% was the highest of all countries surveyed and double the reported global average of 26%.

82% Experienced fraud
 
52% Vendor, supplier, or procurement fraud
 
30% Theft of physical assets or stock
 
18% Corruption and bribery
 
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Brazil

Brazil was one of three countries surveyed whose incidence of fraud came under the global average of 82%. The other two were India and Italy. Just over two-thirds (68%) of Brazilian participants said they experienced fraud in the past 12 months, 14% below the global average.

68% Experienced fraud
 
24% Theft of physical assets or stock
 
21% Information theft, loss, or attack
 
21% Vendor, supplier, or procurement fraud
 
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Colombia

Fraud was reported by almost all (95%) of the participants in the last 12 months in Colombia, the highest proportion in the survey and a 12% increase compared to 2015.

95% Experienced fraud
 
43% Management conflict of interest
 
43% Vendor, supplier, or procurement fraud
 
38% Theft of physical assets or stock
 
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China

Respondents in China reported the widest spread of fraud types. Out of all the regions, participants in China named regulatory or compliance breaches as the primary fraud (41%), which was nearly twice the global average.

86% Experienced fraud
 
41% Regulatory or compliance breach
 
37% Vendor, supplier, or procurement fraud
 
25% Theft of physical assets or stock
 
25% Information theft, loss, or attack
 
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India

68% of respondents in India said their company was affected by fraud in the last 12 months, 14% below the global average of 82%. Overall, companies in India reported a 12% reduction in the incidence of fraud over the last 12 months.

68% Experienced fraud
 
28% Theft of physical assets or stock
 
27% Management conflict of interest
 
27% Corruption and bribery
 
27% Vendor, supplier, or procurement fraud
 
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Italy

Despite a 3% increase in exposure since 2015, the incidence of fraud reported by respondent companies in Italy was below the global average at 77%.

77% Experienced fraud
 
34% Theft of physical assets or stock
 
26% Information theft, loss, or attack
 
26% Regulatory or compliance breach
 
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UK

Theft of physical assets and the misappropriation of funds were the two most common types of fraud reported by respondents in the UK. Both were more widespread in the UK than in any other region.

90% Experienced fraud
 
41% Theft of physical assets or stock
 
37% Misappropriation of company funds
 
24% Information theft, loss, or attack
 
24% Market collusion
 
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Russia

Participants in Russia reported a 9 percentage point increase in fraud over the last 12 months at 82%, equal to the global average. The most common types of fraud were theft of physical assets, theft of data, and vendor or procurement fraud. Theft of assets was 9% above the global average of 29%.

82% Experienced fraud
 
38% Theft of physical assets or stock
 
33% Information theft, loss, or attack
 
26% Vendor, supplier, or procurement fraud
 
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Sub-Saharan Africa

Respondent companies in Sub-Saharan Africa experienced one of the highest fraud incidence levels of all regions covered in the survey: 89% had experienced at least one type of fraud in the past year. Executives in the region reported the highest incidence of internal financial fraud (31%), 11% higher than the global average of 20%.

89% Experienced fraud
 
30% Information theft, loss, or attack
 
26% Theft of physical assets or stock
 
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Middle East

Respondent companies based in the Middle East reported the highest increase in fraud over the past 12 months of all regions surveyed. Over a quarter (26%) more companies said they had experienced fraud compared to 2015. Overall the incidence of fraud in the Middle East was 6% above the global average of 82%.

88% Experienced fraud
 
26% Theft of physical assets or stock
 
24% Information theft, loss, or attack
 
 
 

Past Reports

2015/2016 Global Report

2015-2016

2013-2014 Global Report

2013–2014

2012-2013 Global Report

2012–2013

2011-2012 Global Report

2011–2012

 
2010-2011 Global Report

2010–2011

2009-2010 Global Report

2009–2010

About the Report

For the 2016/2017 Global Fraud and Risk Report, Kroll commissioned Forrester Consulting to conduct 10 in-depth interviews and an additional online survey with 545 senior executives worldwide across multiple industries and geographies. The survey was fielded through July and August 2016.

In addition to building on coverage of fraud from prior Kroll surveys, the scope of research this year was expanded to cover perceptions of and experiences with cyber and security risk. As with prior surveys, respondents represented a variety of industries, including Technology, Media, and Telecoms; Professional Services; Manufacturing; Natural Resources; Construction, Engineering, and Infrastructure; Consumer Goods; Financial Services; Retail, Wholesale, and Distribution; Transportation, Leisure, and Tourism; and Healthcare, Pharmaceuticals, and Biotechnology.

Respondents held senior positions within their companies, with 70% of respondents representing the C-suite. Sixty-one percent of companies had annual revenues of $500 million or more.

Respondents represented all major global geographies, including 25% from Europe, 20% from Asia-Pacific, 20% from North America, 19% from Africa / The Middle East, and 16% from Latin America.