certified fraud examiners estimates in their 2010 survey that the typical organization loses 5% of it’s annual revenue to fraud.
In their study of 1,843 fraud cases the median loss was $160,000. Private Companies sustained higher median losses, $231,000 then all other (Public Companies, Government & Not-for-Profit). In the US, Small Businesses, that ACFE defines as under 100 employees, sustained higher median losses, $150,000 than companies with 1,000 to 10,000+ employees.
Small businesses are particularly vulnerable to fraud. In general, these organizations have far fewer controls in place to protect their resources from fraud and abuse. Don’t think it can’t happen to you.
By a wide margin Small Business cited lack of internal controls (47%) as the most important contributing factor. In my experience staff size is rarely the limiting factor rather management commitment to the importance and need.
Hopefully it isn’t occurring in your company …
Behavorial Red Flags of Perpatrators *
Perhaps you should consider a review before you become part of the grim statistics?
* The sum of percentages in this chart exceeds 100% because in many cases perpetrators displayed more than one behavioral red flag.