How Does The Presence of Anti-Fraud Controls Relate To Median Loss?

$150,000
FIG. 23 How does the presence of anti-fraud controls relate to median loss?
$200,000
$100,000
$150,000
$50,000
$100,000
$0
at ion ine
$50,000
vac tl dit
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ry Ho au lysis
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e r n a
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ota mo A g f edki a oef io exe parEt x onr ttece ortin iew Re
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ive dt fra al a na ud ncge ia nt em en tee s
r o act F rau rmal tern or ma nal a t, fauna nanc geme l stat tatem mmit gram ers
P Fo Ex ing f nter tmen M ver fi a n a
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it c
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I r a M t
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n pa fin finan t aud ppor histle
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ud
t
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n tro o f e n s u w
Median loss without controls Fra rau udl co n n d ee for
t e d f erin na place n a l a catio Median
fi d e pe loss p loy witha r ds controls in place
dic
a
f in
t ter rti In Em Rew
Ex nt ce
De d it o e
u m
la ge
t e rna a na
Ex M
Median loss without controls in place Median loss with controls in place
Control Percent Control Control not Percent

of cases in place in place reduction
Job rotation/mandatory vacation 25% $ 64,000 $140,000 54%
Hotline 70% $100,000 $200,000 50%
Surprise audits 42% $ 75,000 $150,000 50%
Proactive data monitoring/analysis 45% $ 80,000 $150,000 47%
Percent Control Control not Percent
Anti-fraud policy Control 60%
of cases $100,000 in place
in place $183,000 reduction45%
Fraud training for employees
Job rotation/mandatory vacation 25%61% $ 97,000
$ 64,000 $177,000
$140,000 54% 45%
Formal fraud risk assessments
Hotline 70%46% $ 82,000 $200,000
$100,000 $150,000 50% 45%
Code of conduct
Surprise audits 42%82% $100,000
$ 75,000 $168,000
$150,000 50% 40%
Proactive
Fraud dataformonitoring/analysis
training managers/executives 45%59% $ 80,000
$100,000 $150,000
$165,000 47% 39%
Anti-fraud
Internal auditpolicy
department 60%77% $100,000
$100,000 $183,000
$150,000 45% 33%
Fraud training
Dedicated fraudfor employees function, or team
department, 61%48% $ 97,000
$100,000 $177,000
$150,000 45% 33%
Formal fraud risk assessments 46% $ 82,000 $150,000 45%
External audit of internal controls over financial reporting 71% $100,000 $150,000 33%
Code of conduct 82% $100,000 $168,000 40%
Management review 69% $100,000 $150,000 33%
Fraud training for managers/executives 59% $100,000 $165,000 39%
External audit of financial statements 82% $100,000 $150,000 33%
Internal audit department 77% $100,000 $150,000 33%
Management certification of financial statements 74% $100,000 $140,000 29%
Dedicated fraud department, function, or team 48% $100,000 $150,000 33%
Independent audit committee 67% $103,000 $142,000 27%
External audit of internal controls over financial reporting 71% $100,000 $150,000 33%
Employee support programs 56% $ 90,000 $120,000 25%
Management review 69% $100,000 $150,000 33%
Rewards for whistleblowers 15% $100,000 $105,000 5%
External audit of financial statements 82% $100,000 $150,000 33%
Management certification of financial statements 74% $100,000 $140,000 29%
Independent audit committee 67% $103,000 $142,000 27%
Employee support programs 56% $ 90,000 $120,000 25%
36 VICTIM ORGANIZATIONS Occupational Fraud 2022: A Report to the Nations
Rewards for whistleblowers 15% $100,000 $105,000 5%
20
FIG. 24 How does the presence of anti-fraud controls relate to the duration of fraud?
1520
Median months to detection

Median months to detection 1015
10
5
5
0
sis s
n aly udit ion
ng
/ a
ise
a at nts
ori urpr vac ssme am rs
o n i t S t o r y
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o a r o an u m i o
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t ive d ica tion/ fraud nt, fu forcewrt ode itndael a stnattreol nt re emen rtintrgain ine ent a nage ppor
c De rota mal e t C udr cial lco eme t o l d y a u
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u es
d d MaRn Int of in Ma fina an I fra nin mp mp m tiv ms
rau i oitnof o f r fin n ti- trai for e E com xecu gra
d f c a td i t v e A d i t / e r o
ifi au ud ols o u n g d rs p
ate ertal la Fraraini ta
u
ge ort
dic ttcern na contr t en na supp
De n e r d d
en or m
a
meEx Ex
t
na
l
Fra
u
ep ee
ge ter Ind ning
f loy
a na i n p
M f rai Em
it o dt
Median duration without controls a ud in place a u
na
l Median
F r duration with controls in place
ter
Ex
Median duration without controls in place Median duration with controls in place
Percent Control Control not Percent

Control
of cases in place in place reduction
Proactive data monitoring/analysis 45% 8 months 18 months 56%
Surprise audits 42% 9 months 18 months 50%
Control Percent Control Control not Percent
Job rotation/mandatory vacation
of25%
cases 8 months
in place 16 months
in place 50%
reduction
Formal fraud risk assessments 46% 10 months 18 months 44%
Proactive data monitoring/analysis 45% 8 months 18 months 56%
Dedicated fraud department, function, or team 48% 10 months 18 months 44%
Surprise audits 42% 9 months 18 months 50%
Rewards for whistleblowers 15% 8 months 13 months 38%
Job rotation/mandatory vacation 25% 8 months 16 months 50%
Code of conduct
Formal fraud risk assessments 82%
46% 12 months
10 months 18months
18 months 33%
44%
Internal audit fraud
Dedicated department
department, function, or team 77%
48% 12 months
10 months 18months
18 months 33%
44%
Management
Rewards forcertification of financial statements
whistleblowers 74%
15% 812months
months 18months
13 months 33%
38%
Management review
Code of conduct 69%
82% 12 months
12 months 18months
18 months 33%
33%
External audit
Internal auditofdepartment
financial statements 82%
77% 12 months
12 months 18 months
18 months 33%
33%
External audit of internal controls
Management certification over financial
of financial reporting
statements 71%
74% 12 months
12 months 18months
18 months 33%
33%
Hotline
Management review 70%
69% 12 months
12 months 18 months
18 months 33%
33%
Anti-fraud
Externalpolicy
audit of financial statements 60%
82% months
12 months 18months
18 months 33%
33%
Fraud training
External forofemployees
audit internal controls over financial reporting 61%
71% months
12 months 18months
18 months 33%
33%
Independent
Hotline audit committee 67%
70% months
12 months 18months
18 months 33%
33%
Fraud trainingpolicy
Anti-fraud for managers/executives 59%
60% months
12 months 15months
18 months 20%
33%
Employee supportforprograms
Fraud training employees 56%
61% months
12 months 12months
18 months 0%
33%
Independent audit committee 67% 12 months 18 months 33%
Fraud training for managers/executives 59% 12 months 15 months 20%
Employee support programs 56% 12 months 12 months 0%
VICTIM ORGANIZATIONS Occupational Fraud 2022: A Report to the Nations 37
ANTI-FRAUD CONTROLS IN SMALL BUSINESSES
Small organizations face unique challenges in combatting fraud—from limited financial resources and smaller staff sizes
that require many individuals to perform numerous functions, to the large amount of trust needed to keep operations
running and the business growing. Unfortunately, that means that many of the protective anti-fraud controls that larger
organizations rely on are simply not enacted within small businesses. Figure 25 shows the implementation rates of
anti-fraud controls at small businesses (i.e., organizations with fewer than 100 employees) compared to their larger
counterparts. Across all 18 controls, small organizations had notably lower levels of implementation; even the most
common controls—external audits of financial statements and a formal code of conduct—were only in place at 53% of
small businesses in our study, compared to approximately 90% of larger organizations.
FIG. 25 how do anti-fraud controls vary by size of victim organization?
External audit of financial statements 53%

90%
Code of conduct 53%
89%
Management certification of financial statements 45%
82%
Management review 43%
53% 76%
External audit of financial statements 37% 90%
External audit of internal controls over financial reporting 53% 80%
Code of conduct 89%
Internal audit department 36% 45%
Management certification of financial statements 82% 88%
Independent audit committee Management review 28% 43%
77% %
76
External audit of internal controls over financial reporting 26% 37%
Hotline 80% %
36% 81
Internal audit department 88%
Anti-fraud policy 25% 28% 69%
Independent audit committee 77%
Fraud training for employees 25% 26%
Hotline 70% 81%
Fraud training for managers/executives Anti-fraud policy 25% 25%
%69%
25%
68
Fraud training for employees 24% 70%
Employee support programs 25% 64%
Fraud training for managers/executives 68%
Proactive data monitoring/analysis 21%
Employee support programs 24% 51% 64%
Surprise audits
Proactive data monitoring/analysis 19% 21%
48% 51%
Surprise audits 17% 19%
Formal fraud risk assessments 4855
%
%
Formal fraud risk assessments % 17% 55%
Dedicated fraud department, function, or team 13
Dedicated fraud department, function, or team 13% 57% 57%
Job rotation/mandatory vacation 12%
Job rotation/mandatory vacation 12% 29% 29%
Rewards for whistleblowers 9%
17% 17%
<100 employees
<100 employees
100+ employees
100+ employees

MODIFYING ANTI-FRAUD CONTROLS FOLLOWING A FRAUD
A comprehensive response to a discovered fraud should include assessing the factors that allowed the fraud to occur and
taking steps to prevent similar frauds from being able to happen again in the future.
DID VICTIM ORGANIZATIONS MODIFY THEIR $120,000

ANTI-FRAUD CONTROLS FOLLOWING FRAUD?
MEDIAN LOSS
$58,000
Did not modify

anti-fraud controls
19%
Modified Did not
controls modify controls
81%
Modified ORGANIZATIONS THAT HAD
anti-fraud controls
HIGHER LOSSES were more
likely to modify their controls
following the fraud
MOST COMMON CHANGES MADE

TO ANTI-FRAUD CONTROLS
Of changes made to anti-fraud controls, the most common involved implementing or modifying:
75% 64% 54% 48% 42%
Management Proactive data Surprise audits Internal audit Anti-fraud training

review monitoring department
WHICH TYPES OF ORGANIZATIONS WERE MOST LIKELY

TO MODIFY THEIR ANTI-FRAUD CONTROLS?
Nonprofit 87%
Public company 83%
Private company 83%
Government 74%
MODIFYING ANTI-FRAUD CONTROLS FOLLOWING A FRAUD Occupational Fraud 2022: A Report to the Nations 39
COVID’S EFFECT ON OCCUPATIONAL FRAUD
We asked survey participants whether several

pandemic-related issues contributed to the frauds
that they investigated; 52% of respondents noted
that at least one of these factors was present in
their case. Of the factors analyzed, pandemic-relat-
ed organizational staffing changes were the most
common (42% of cases), and a shift to remote work
was the factor most commonly cited as significant
(15% of cases).
TO WHAT EXTENT DID PANDEMIC-RELATED FACTORS

CONTRIBUTE TO OCCUPATIONAL FRAUDS?
Organizational staffing changes 12% 16% 14% 58%
Operational process changes 12% 14% 13% 60%
Internal control changes 13% 14% 12% 61%
Shift to remote work 15% 14% 9% 62%
Changes to strategic priorities 10% 12% 12% 65%
Technology challenges 9% 11% 10% 69%
Changes to anti-fraud program 8% 11% 11% 70%
Supply chain disruptions 9% 11% 10% 71%
Significant factor Moderate factor Slight factor Not a factor
MEDIAN DURATION It’s important to note that this study analyzes cases that were investigated between
OF FRAUD
January 2020 and September 2021, not necessarily frauds that were committed
during that time. Since the median duration of the frauds in this study was 12 months,
many of the frauds analyzed were perpetrated before the COVID-19 pandemic began.
12 Consequently, we anticipate seeing additional pandemic-related factors underlying

the cases in our 2024 study, when many more frauds that began during the pandemic
MONTHS will have been detected and investigated.
40 COVID’S EFFECT ON OCCUPATIONAL FRAUD Occupational Fraud 2022: A Report to the Nations
background checks
Background checks are an important tool in the fight against fraud, as they can prevent organizations from hiring individu-
als with known histories of misconduct. However, as noted in Figure 26, 43% of victim organizations did not run a back-
ground check on the perpetrator prior to hiring. Further, of the background checks that were run on the perpetrators, 21%
revealed previous red flags, meaning that the individuals were hired even with known instances of misconduct or other
concerns.
We also asked about the specific types of background checks that the victim organizations conducted. As shown in Figure
28, the two most common forms of background checks run by the organizations were employment history checks (45%)
and criminal background checks (40%).
FIG. 26 was a background check run on the perpetrator prior to hiring?
43% FIG. 27 did the background checks

reveal existing red flags?
No
57% 21%
Yes
Yes
79%
No
FIG. 28 what types of background checks were run on the perpetrator prior to hiring?
Employment history
45%
No background checks
43%
Criminal checks
40%
Reference checks
30%
Education verification
30%
Credit checks
21%
Drug screening
11%
Other
2%

Internal Control Weaknesses That Contributed to the Fraud
Even in organizations with anti-fraud programs, fraud can and does happen. To better understand the factors that can
lead to occupational fraud, we asked survey participants to identify the primary internal control weakness that allowed
the fraud case to occur. The most common factor underlying the occupational frauds in our study was a lack of internal
controls; 29% of victim organizations did not have adequate controls in place to prevent the fraud from occurring. Another
20% of cases involved an override of existing internal controls, meaning the victim organization had implemented mech-
anisms to protect against fraud, but the perpetrator was able to circumvent those controls. Together, this data shows that
nearly half of the frauds in our study likely could have been prevented with a stronger system of anti-fraud controls.
Individuals with different levels of authority within an organization tend to have different amounts of access and influence,
which can affect how they are able to perpetrate fraud. We analyzed how the internal control weaknesses varied by the
position of the perpetrator, as shown in Figure 30. Not surprisingly, a poor tone at the top was the most common factor
underlying schemes perpetrated by owners and executives. The most common control weakness for both staff-level
employees and mid-level managers was a lack of internal controls (34% and 29%, respectively).
FIG. 29 what are the primary internal control weaknesses that contribute to occupational fraud?
Lack of internal controls 29%
Override of existing controls 20%
Lack of management review 16%
Poor tone at the top 10%

Lack of competent personnel in oversight roles 8%
Lack of independent checks/audits 5% Other 7%
Lack of employee fraud education 3%
Lack of clear lines of authority 2%
Lack of reporting mechanism <1%

FIG. 30 Top 3 Internal Control Weaknesses Based on the Perpetrator’s Position
EMPLOYEE 34 % Mana
Lack of internal controls
17% 18%
Lack of Lack of
management management
review review
23%
Override of existing
internal controls
PLOYEE 34% Manager 29% owner/e

Lack of internal controls Lack of internal controls
18%
Lack of
management
23%
review
23 % 19%
Override of existing Lack of
Override of existing internal controls
internal controls internal controls
nager 29% owner/executive 23%

Lack of internal controls Poor tone at the top
20%
Override of existing
internal controls
23 % 19%
Override of existing Lack of
internal controls internal controls

PERPETRATORS
Participants in our survey answered several questions about the fraud perpetrators’
job details, basic demographics, prior misconduct, and behavioral warning signs that
might have indicated fraud. This information helps us identify common characteristics
and behaviors of fraud perpetrators, which can be used by organizations to assess
relative levels of risk among their own employees.
Perpetrator’s Position
Our data shows a strong correlation between the perpetrator’s level of authority and the size of the fraud. Owner/execu-
tives only committed 23% of the frauds in our study, but the median loss in those cases (USD 337,000) was significantly
larger than losses caused by managers. In turn, managers caused much larger losses than staff-level employees. This find-
ing is consistent with our past studies, all of which have shown that fraud losses tend to be larger in schemes committed by
higher-level fraudsters.
Frauds committed by higher-level perpetrators also typically take longer to detect. As shown in Figure 32, the median du-
ration of a fraud committed by an owner/executive was 18 months, whereas frauds committed by staff-level employees had
a median duration of only eight months. One of the challenges of dealing with fraud committed by high-level perpetrators
is that these individuals often have the ability to evade or override controls that would otherwise detect fraud. Additionally,
fraudsters in positions of authority might bully or intimidate employees below them, which can deter those employees from
reporting or investigating suspected wrongdoing. Both of these factors might contribute to the longer duration of frauds
committed by high-level employees.
Owner/executive
Owners/executives $337,000
committed only 23% of
Manager
occupational frauds,
but they caused the $125,000 85%of fraudsters
displayed at least one
largest losses. Employee BEHAVIORAL RED FLAG OF FRAUD
$50,000
44 Perpetrators Occupational Fraud 2022: A Report to the Nations
FIG. 31 how does the perpetrator’s level of authority relate to occupational fraud?
$337,00o
$125,00o $133,00o
$50,00o
Employee Manager Owner/executive Other
2%
23%
Median loss
37% 39% Percent of cases
FIG. 32 how does the perpetrator’s level of authority relate to scheme duration?
Median duration
Employee
8 months
Manager 16 months
Owner/executive
18 months
Perpetrators Occupational Fraud 2022: A Report to the Nations 45

Perpetrator’s Tenure
The perpetrator’s length of service with the victim organization is also strongly correlated with the size of the fraud. In our
study, fraudsters with at least ten years of tenure at the victim organization caused median losses of USD 250,000. This
was five times the median loss caused by perpetrators with less than one year of tenure.
FIG. 33 how does the perpetrator’s tenure relate to occupational fraud?
$250,00o
$137,00o
$100,00o
$50,00o
<1 year 1–5 years 6–10 years >10 years
9%
20%
25%
Median loss
Percent of cases
47%
Perpetrator’s Department
In order to allocate anti-fraud controls and resources most effectively, it is important to understand the relative risks of
occupational fraud throughout an organization. The heat map in Figure 34 shows the frequency and median loss of fraud
schemes based on the departments in which fraud perpetrators worked. We can see, for example, that frauds committed
by executives and upper management were not only common (11% of cases) but also costly (USD 500,000 median loss),
making this a very high-risk area in general. Accounting and sales departments were also both associated with a high
percentage of cases (12% and 11%, respectively) while also causing six-figure median losses.
46 PERPETRATORS Occupational Fraud 2022: A Report to the Nations

FIG. 34 what departments pose the greatest risk for occupational fraud?
Board of directors Executive/upper

management
Board of directors Executive/upper

management
Information
technology Finance
Accounting
Information
technology Finance
Marketing/ Purchasing Accounting
public relations Warehousing/inventory
Marketing/ Purchasing Sales
public relationsManufacturing
Human resources
and
Warehousing/inventory Administrative
production support
Manufacturing and Sales
Research
Human and development
resources Administrative Operations
production support
Facilities
Research and maintenance
and development Operations
Facilities and maintenance
Customer service
Customer service
Less risk More risk

Less risk More risk
Department* Number of cases Percent of cases Median loss Department* Number of cases Percent of cases Median loss
Operations 273 15% $74,000 Board of directors 58 3% $500,000
Department*
Accounting Number of cases
230 Percent of12%
cases Median loss
$155,000 Department*
Information technology 53Number of cases
3% Percent of cases Medi
$150,000
Executive/upper management 206 11% $500,000 Warehousing/inventory 58 3% $116,000
erations 273 15% $74,000 Board of directors 58 3% $50
Sales 203 11% $100,000 Manufacturing and production 63 3% $100,000
counting 230 12% 8% $155,000 Information technology
Facilities and maintenance 49
53 3%
3%
$58,000
$15
Customer service 140 $40,000
ecutive/upperPurchasing
management 206 131 11% 7% $500,000
$129,000 Warehousing/inventory
Marketing/public relations 35 58 2% 3%
$112,000 $11
es Administrative support 203 131 11% 7% $100,000
$90,000 Manufacturing
Human resources and production 29 63 2% 3%
$100,000 $10
Finance
stomer service 140 95 8% 5% $160,000
$40,000 Research and development
Facilities and maintenance 17 49 1% $75,000
3% $5
*Departments with fewer than 10 cases were omitted.
rchasing 131 7% $129,000 Marketing/public relations 35 2% $11
ministrative support 131 7% $90,000 Human resources 29 2% $10
ance 95 5% $160,000 Research and development 17 1% $7
PERPETRATORS Occupational Fraud 2022: A Report to the Nations 47
*Departments with fewer than 10 cases were omitted.
HOW DOES TENURE AFFECT FRAUD RISK?
The ability to commit fraud is a skill, and our data suggests that the longer a person works for a
company, the better they become at fraud. In this infographic, we compare fraudsters with long
tenure (more than 10 years) to those with moderate-to-low tenure (5 years or less).
Long-tenured FRAUDSTERS Even when COMPARING FRAUDSTERS

steal almost with similar LEVELS OF AUTHORITY,
3X MORE LONG-TENURED FRAUDSTERS caused
MUCH LARGER LOSSES
$250,00o
Employee $36,000
$127,000
$100,000
$90,00o Manager
$240,000
Owner/ $280,000
executive $616,000
≤5 years >10 years ≤5 years >10 years
Long-tenured fraudsters are Long-tenured fraudsters

more likely to COLLUDE TAKE LONGER TO CATCH
Percent of cases with multiple perpetrators
56% 1o months
64% 24 months
48 HOW DOESPerpetrators Report

TENURE AFFECT to theRISK?
FRAUD Nations
Occupational Fraud 2022: A Report to the Nations
Less-tenured fraudsters were MORE THAN Less-tenured fraudsters were more
TWICE AS LIKELY to have been previously
FIRED or PUNISHED for fraud-related conduct
likely to have a CRIMINAL RECORD
21% 8%
9% 3%
These 6 RED FLAGS were much more

common among long-tenured employees
43%
36%
25%
17% 19%
Living Unusually close Control issues,
beyond association with unwillingness 11%
means vendor/customer to share duties
?#!
?!#
15% 15% 15%

11% Irritability, 12% Recent 10%
Bullying suspiciousness, divorce or
or intimidation or defensiveness family problems
≤5 years >10 years
HOW DOES TENURE AFFECT FRAUD RISK? Occupational Fraud 2022: A Report to the Nations 49
SCHEMES BASED ON PERPETRATOR’S DEPARTMENT
The eight departments shown in Figure 35 accounted for 76% of all occupational frauds in our study. In this chart, we
have identified the frequency of various types of occupational fraud that occurred in each department. Boxes are shaded
from light to dark, with darker boxes indicating higher-frequency schemes. This information can help organizations as-
sess fraud risk and implement effective anti-fraud controls in these high-risk areas.
FIG. 35 What are the most common occupational fraud schemes in high-risk departments?
Check and payment tampering
Financial statement fraud

Expense reimbursements
Register disbursements
Cash on hand
Cash larceny
Corruption
Skimming
Noncash
Payroll
Billing
DEPARTMENT Cases
Operations 273 16% 7% 8% 11% 48% 9% 6% 16% 8% 1% 6%
Accounting 230 24% 15% 13% 29% 33% 10% 10% 7% 16% 3% 19%
Executive/upper 206 31% 9% 10% 12% 65% 18% 22% 21% 13% 2% 12%
management
Sales 203 11% 6% 7% 2% 51% 8% 6% 18% 4% 2% 11%
Customer service 140 8% 10% 16% 11% 44% 6% 7% 17% 6% 3% 10%
Administrative support 131 23% 8% 15% 15% 37% 16% 5% 12% 12% 5% 10%
Purchasing 131 27% 1% 4% 2% 82% 5% 2% 14% 3% 0% 2%
Finance 95 26% 7% 11% 12% 48% 20% 14% 12% 7% 3% 12%
Less risk More risk
Nearly half of all occupational frauds came from these four departments:
Operations 15% Accounting 12%

Executive/upper 11% On
management Sales 11 %
of perpe
prior frau

Perpetrator’s Gender
As Figure 36 illustrates, 73% of occupational fraud perpetrators were male. This is consistent with our prior studies, all of
which have found there to be a significant gender disparity in terms of occupational fraud frequency. However, the gap
in median loss between men and women in this study was much smaller than in our previous research. Median losses
caused by men (USD 125,000) were only 25% higher than median losses caused by women (USD 100,000). By compari-
son, in each of our prior studies, median losses caused by male perpetrators were at least 75% higher than median losses
caused by female perpetrators (see A Decade of Occupational Fraud infographic, page 18).
FIG. 36 how does the perpetrator’s gender relate to occupational fraud?
$125,00o
$100,00o
Female Male
27%
73%
Median loss
Percent of cases

PERPETRATOR’S GENDER BASED ON REGION
The gender disparity among occupational fraudsters varied significantly based on geographic region. In the United States and
Canada, for example, female perpetrators accounted for 38% of occupational frauds, while in Southern Asia and the Middle
East and North Africa, female fraudsters committed a far smaller percentage of all schemes (5% and 10%, respectively).
FIG. 37 how does the gender distribution of perpetrators vary by region?
��
20%
Western Europe
80% 21%
Eastern Europe and
Western/Central Asia
��

United States
and Canada 38% 10%
79%
5%
62%
Middle East 95%
and North Africa Southern Asia
� �
90%
��
28% 72%
��
25% Asia-Pacific
25%
75%
75%
Latin America and Sub-Saharan Africa

the Caribbean
Female
Male

POSITION OF PERPETRATOR BASED ON GENDER
When we analyzed the cases in our study based on both the fraudster’s gender and job position, we found that men com-
mitted a much larger percentage of frauds than women did at all three levels of authority (staff-level employee, manager,
and owner/executive). Interestingly, median losses for male and female perpetrators were almost identical in the employ-
ee and manager categories. It was only in the owner/executive category that fraud losses caused by men significantly
exceeded those caused by women.
FIG. 38 how do gender distribution and median loss vary Based on the perpetrator’s level of authority?
Median loss Percent of cases

Employee
$50,000
Median loss 65%Percent of cases
$50,000 Employee 35%
$50,000 65%
$50,000 35%
Manager
$125,000 Manager 75%
$120,000$125,000 25% 75%
$120,000 25%
Owner/executive
Owner/executive
$446,000 $446,000 8282%%
$213,000 $213,000 18%18%
Male
Male
Female
Female

Perpetrator’s Age
The age distribution of fraud perpetrators in our study resembles a bell curve with the majority of frauds (54%) hav-
ing been committed by people between the ages of 31 and 45. Median losses, on the other hand, tended to directly
correlate with age. Only 3% of fraudsters were over the age of 60, but the median loss in this group$800,000
was USD 800,000,
which far surpassed any other age category.
FIG. 39 How does the perpetrator’s age relate to occupational fraud? $800,000
$347,000
$300,000
$347,000
$200,000 $300,000
$185,000
$200,000
$100,000 $185,000
$80,000
$40,000 $36,000
$100,000
$80,000
$40,000 $36,000
<26 26–30 31–35 36–40 41–45 46–50 51–55 56–60 >60
<26 26–30 31–35 36–40 41–45 46–50 51–55 56–60 >60
3%
5% 5% 3%
5%% 9% 5%
10 9%
10%
15% 14%
15% 14% Median loss
20% 19% 19% Median loss
20% Percent of cases
Percent of cases

Perpetrator’s Education Level
As seen in Figure 40, 65% of occupational fraud perpetrators had a university degree or higher. Median losses were also
larger among this group compared to those with lower education levels. Generally, we would expect losses to correlate
to educational background because those with higher levels of authority also tend to have higher levels of education.
FIG. 40 how does the perpetrator’s education level relate to occupational fraud?
High school
graduate or less
$65,00o High school 20%
graduate or less
$65,00o 20%
Some university
$115,00o Some university 16%
$115,00o 16%
University degree
University degree
$150,00o 47%
$150,00o 47%
Postgraduate degreedegree
Postgraduate
$135,00o $135,00o 18%18%
Median loss
Median loss
Percent of cases
Percent of cases

Collusion by Multiple Perpetrators
The majority of frauds in our study (58%) were committed by two or more perpetrators acting in collusion. As Figure 41
illustrates, median losses tend to rise significantly when more than one person conspires to commit fraud. One likely
reason for larger losses in collusive schemes is that multiple perpetrators working together may be able to circumvent
controls based on separated duties and independent verification of transactions. Interestingly, however, the median
duration of frauds in all three categories was the same (12 months), meaning frauds committed by multiple perpetrators
tended to be caught just as quickly as frauds committed by single perpetrators.
FIG. 41 how does the number of perpetrators in a scheme relate to occupational fraud?
��
42%
of cases ONE
PERPETRATOR
$57,000
��
Median loss
20%
of cases TWO
PERPETRATORS
$145,000
��
Median loss
38%
of cases
THREE OR MORE
PERPETRATORS
$219,000
Median loss

Perpetrator’s Criminal Background
Only 6% of perpetrators in our study had a prior fraud-related conviction, which is consistent with our findings in previous
studies. It is worth noting, however, that 42% of cases in our study were not reported to law enforcement (see Response
to Fraud infographic, page 63), which is also consistent with prior findings. Because so many frauds go unreported, it is
very likely that the true number of repeat offenders is higher than the 6% who have prior convictions.
FIG. 42 do perpetrators tend to have prior fraud convICTIONS?
6%
Had prior
convictions 1%
Other
7%
Charged but
not convicted
87%
Never charged
or convicted
Perpetrator’s Employment History

As seen in Figure 43, 83% of fraudsters in our study had no prior record of having been punished or terminated by an em-
ployer for fraud-related conduct. But similar to the criminal conviction data in Figure 42, it is possible that this overstates
the true number of first-time offenders. As seen in Figure 47 on page 62, 7% of fraudsters in our study were not punished,
11% were permitted to resign, and 10% signed settlement agreements with the victim organization. This indicates that a
considerable number of fraudsters may have no employment disciplinary record for fraud even after having been caught.
FIG. 43 do perpetrators tend to have prior EMPLOYMENT-RELATED disciplinary actions for fraud?
8%
Previously
terminated 1%
Other
9%
Previously
punished
83%
Never punished
or terminated

Behavioral Red Flags Displayed by Perpetrators
When a person is engaged in occupational fraud, that person will often display certain behavioral traits that tend to be
associated with fraudulent conduct. The median duration of a fraud in our study was 12 months, which means that for a
full year before the typical fraud is detected, the perpetrator may be exhibiting warning signs that could help the victim
organization discover the crime.
We presented survey respondents with a list of 20 common behavioral red flags of fraud4, and asked which, if any,
of these red flags were displayed by the perpetrator before the fraud was eventually detected. Figure 44 shows the
results of this analysis. At least one red flag had been identified in 85% of the cases in our study, and multiple red
flags were present in 51% of cases. The eight most common red flags were: (1) living beyond means; (2) financial
difficulties; (3) unusually close association with a vendor or customer; (4) excessive control issues or unwillingness to
share duties; (5) unusual irritability, suspiciousness, or defensiveness; (6) bullying or intimidation; (7) recent divorce or
family problems; and (8) a general “wheeler-dealer” attitude involving shrewd or unscrupulous behavior. At least one
of these eight red flags was identified in 76% of all cases.
FIG. 44 how often do perpetrators exhibit Behavioral red flags?
Living beyond means 39%

Financial difficulties 25%
Unusually close association with vendor/customer 20%
No behavioral red flags 15%
Control issues, unwillingness to share duties 13%
Irritability, suspiciousness, or defensiveness 12%
Bullying or intimidation 12%
Divorce/family problems 11%
"Wheeler-dealer" attitude 10%
Excessive pressure from within organization 8%
Addiction problems 7%
Complained about inadequate pay 7%
Refusal to take vacations 7%
Social isolation 6%
Past legal problems 5%
Complained about lack of authority 5%
Other employment-related problems 4%
Excessive family/peer pressure for success 4%
Excessive tardiness or absenteeism 3%
Instability in life circumstances 3%
Excessive internet browsing 2%
Other 2%
4
We added three new red flags to our survey this year that were not included in this question in previous studies: bullying or intimidation; excessive
tardiness or absenteeism; and excessive internet browsing.

Human Resources–Related Red Flags
Figure 46 includes a list of factors that might relate to the fraudsters’ job performance or job security as would likely be
noted in human resources (HR) records. We refer to these as HR-related red flags. Each of these factors could potentially
cause financial stress or resentment toward an employer, which might impact a person’s decision to commit fraud. As
shown in Figure 45, 50% of fraudsters had exhibited at least one HR-related red flag prior to or during the time of their
frauds. The three most common were fear of job loss, poor performance evaluations, and having been denied a raise or
promotion. Each of these flags was cited in more than 10% of all cases.
FIG. 45 do fraud perpetrators experience negative hr-related issues prior to or during their frauds?
No
50%
50% Yes
FIG. 46 which hr-related issues are most commonly experienced by fraud perpetrators?
12%
Denied raise or promotion
7%
Cut in benefits
15% 6%
Poor performance
evaluations Cut in pay
6%
Actual job loss
16% Involuntary cut in hours

4%
Fear of job loss
4%
Demotion
2%
Other

BEHAVIORAL RED FLAGS OF FRAUD
Recognizing the behavioral clues displayed by fraudsters can help
organizations more effectively detect fraud and minimize their losses.
8 KEY WARNING SIGNS

OF ALL FRAUDSTERS
85
These are the 8 most common behavioral clues
% displayed at least one
BEHAVIORAL of occupational fraud. At least one of these
RED FLAG red flags was observed in 76% of all cases.
39% 25% 20% 13% 12% 12% 11% 10%

Living beyond Financial Unusually close Control issues, Irritability, Bullying or Divorce/family "Wheeler-dealer"
means difficulties association with unwillingness suspiciousness, intimidation problems attitude
vendor/customer to share duties or defensiveness
LIVING BEYOND MEANS

Fraudsters living beyond their means has been the
50% most common red flag in every study since 2008.
40% Living beyond means
30%
Financial difficulties
Unusually close association
20% with vendor/customer
Control issues, unwillingness

to share duties
Irritability, suspiciousness,
or defensiveness
Bullying or intimidation*
10% Divorce/family problems
“Wheeler-dealer” attitude
0 %
’08 ’10 ’12 ’14 ’16 ’18 ’20 ’22

* "Bullying or intimidation" was included as an option in our survey beginning in 2014 and was asked in a separate question prior to 2022.
60 Perpetrators
BEHAVIORAL RED FLAGS Report to theOccupational
OF FRAUD Nations Fraud 2022: A Report to the Nations
LOSS AMOUNTS
All loss amounts are expressed in terms of U.S. dollars, which is how respondents reported this information in the
Global Fraud Survey.
Unless otherwise indicated, all loss amounts discussed throughout the report are calculated using median loss rather
than mean, or average, loss. Using median loss provides a more conservative—and we believe more accurate—pic-
ture of the typical impact of occupational fraud schemes. The statistical appendix to this report (see pages 86—88)
provides a more holistic view of the losses in our study, reflecting quartiles and average loss amounts for numerous
categories explored throughout the report.
To normalize the loss amounts reported

to us and ensure that cases with extreme-
ly large losses were not identifiable, all FIG. 50 what was the primary occupation of survey participants?
average and total loss amounts reported
were calculated using loss data that was
Fraud examiner/investigator
winsorized at 5% (i.e., all cases in the top
2.5% and bottom 2.5% were assigned the
40%
same value as the 97.5th percentile and Internal auditor
20%
2.5th percentile, respectively). Additional-
ly, we excluded median and average loss
Accounting/finance professional 6%
calculations for categories for which there
were fewer than ten responses.
Compliance and ethics professional 6%
Because the direct losses caused by
financial statement frauds are typically
spread among numerous stakeholders, Law enforcement 5%
obtaining an accurate estimate for this
amount is extremely difficult. Conse- Risk and controls professional 5%
quently, for schemes involving financial
statement fraud, we asked survey partici-
Corporate security and loss prevention 3%
pants to provide the gross amount of the
financial statement misstatement (over- or
understatement) involved in the scheme. Other 3%
All losses reported for financial statement
frauds throughout this report are based
External/independent auditor 3%
on those reported amounts.
Consultant
Survey Participants 3%
To provide context for the survey re-
Attorney/legal professional 2%
sponses and to understand who inves-
tigates cases of occupational fraud, we
asked respondents to provide certain Private investigator 1%
information about their professional expe-
rience and qualifications.
IT/computer forensics specialist 1%
PRIMARY OCCUPATION
Bank examiner 1%
The majority of survey respondents
indicated that their primary profession is
either a fraud examiner/investigator (40%) Educator 1%
or an internal auditor (20%).
Methodology Occupational Fraud 2022: A Report to the Nations 67

NATURE OF FRAUD EXAMINATION ROLE
More than half of our survey participants (55%) work in-house and conduct fraud-related engagements on behalf of a
single organization (i.e., their employer), while one-quarter work for a professional services firm that conducts fraud-
related engagements for client organizations. In addition, 16% work for law enforcement agencies and conduct fraud
investigations of other parties under their agency’s authority.
FIG. 51 What was the professional role of the survey participants?
3%
16% Other
Law enforcement
55 %
In-house examiner
25%
Professional
services firm
68 Methodology Occupational Fraud 2022: A Report to the Nations

PROFESSIONAL EXPERIENCE
The CFEs who participated in the Global Fraud Survey had a median 11 years’ experience in the fraud examination field,
with 31% having more than 15 years of experience. Additionally, nearly one-quarter of participants have investigated more
than 20 cases of fraud in the past two years (see Figure 53).
FIG. 52 HOW MUCH FRAUD EXAMINATION EXPERIENCE DID SURVEY PARTICIPANTS HAVE?
≤5 years 21%
6–10 years 28%
11–15 years 19%
16–20 years 14%
>20 years 17%
FIG. 53 HOW MANY FRAUD CASES HAVE SURVEY PARTICIPANTS INVESTIGATED IN THE PAST TWO YEARS?
>20 cases (24%)
16–20 cases (7%)

11–15 cases (8%)
6–10 cases (19%)
≤5 cases (41%)
Methodology Occupational Fraud 2022: A Report to the Nations 69

REGIONAL FOCUS
ASIA-PACIFIC
FIG. 54 what are the most common occupational

What are the most common occupational fraud schemes in the Asia-Pacific region?
FIG. 55 how is occupational fraud initially
How is occupational fraud initially detected in the Asia-Pacific region?
fraud schemes in the asia-pacific region? detected in the asia-pacific region?
Corruption Tip
57% 58%
Billing Internal audit

20% 11%
Noncash Management review

17% 10%
Expense reimbursements Document examination

15% 5%
Cash on hand By accident

11% 5%
Financial statement fraud Automated transaction/data monitoring

11% 3%
Payroll Account reconciliation

11% 3%
Check and payment tampering Confession

9% 2%
Skimming External audit

9% 2%
Cash larceny Surveillance/monitoring

6% 1%
Register disbursements Notification by law enforcement

2% 1%
70 REGIONAL FOCUS | Asia-Pacific Occupational Fraud 2022: A Report to the Nations

FIG. 56 what anti-fraud controls are the most FIG. 58 CASES BY COUNTRY IN THE
common in the asia-pacific region? ASIA-PACIFIC REGION
Control Percent of cases Country Number of cases

External audit of financial statements 88% American Samoa 2
Code of conduct 84% Australia 38
Internal audit department 82% China 33
Hotline 80% Fiji 1
Management certification of financial statements 77% Hong Kong 13
Fraud training for employees 76% Indonesia 23
Independent audit committee 75% Laos 1
Management review 75% Malaysia 25
External audit of internal controls over financial reporting 73% Micronesia 1
Anti-fraud policy 72% New Zealand 6
Fraud training for managers/executives 69% Papua New Guinea 3
Employee support programs 59% Philippines 12
Dedicated fraud department, function, or team 55% Singapore 13
How does the Perpetrator’s level of authority relate
Formal fraud risk assessments
to
54% Solomon Islands 1
occupational fraud in the
Proactive data monitoring/analysis
ASIA-Pacific region? 52% South Korea 2
Surprise audits 46% Taiwan 3
Job rotation/mandatory vacation 31% Median Loss Asia-Pacific region?
Thailand 9
Rewards for whistleblowers 14% Vietnam 8
TOTAL CASES 194

FIG. 57 how does the perpetrator’s level of authority
relate to occupational fraud in the asia-pacific region?
$500,000
MEDIAN LOSS:
USD 121,000
��
$100,000
10%
$50,000
OF ALL CASES
Employee Manager Owner/

executive
194
CASES
23%
36%
39% Median loss
Percent of cases
REGIONAL FOCUS | Asia-Pacific Occupational Fraud 2022: A Report to the Nations 71

REGIONAL FOCUS
EASTERN EUROPE AND

WESTERN/CENTRAL ASIA
What are the most common occupational fraud schemes in Eastern Europe and Western/Central Asia?
FIG. 59 what are the most common occupational fraud FIG. 60 How
How is occupational is occupational
fraud initially fraud
detected in Eastern Europeinitially detected
and Western/Central Asia?in
schemes in eastern europe and western/central asia? Eastern Europe and Western/Central Asia?
Corruption Tip
64% 36%

26% 22%

23% 14%
Financial statement fraud Document examination

9% 10%
Skimming Automated transaction/data monitoring

8% 5%
Cash on hand External audit

6% 4%
Expense reimbursements By accident

6% 3%
Check and payment tampering Surveillance/monitoring

5% 3%
Payroll Other
5% 3%
Cash larceny Notification by law enforcement

4% 1%
Register disbursements
4%
72 REGIONAL FOCUS | Eastern Europe and Western/Central Asia Occupational Fraud 2022: A Report to the Nations
FIG. 61 What anti-fraud controls are the most common FIG. 63 cases by country in eastern
in Eastern Europe and Western/Central Asia? europe and western/central asia

Code of conduct 83% Albania 3
External audit of financial statements 83% Azerbaijan 3
Internal audit department 81% Bulgaria 5
Hotline 75% Croatia 1
Management review 71% Czech Republic 8
Independent audit committee 69% Estonia 1
Management certification of financial statements 68% Hungary 1
External audit of internal controls over financial reporting 66% Kazakhstan 2
Fraud training for employees 62% Moldova 1
Fraud training for managers/executives 60% Poland 9
Dedicated fraud department, function, or team 55% Romania 4
Anti-fraud policy 52% Russia 11
Surprise audits 46% Serbia 6
Proactive data monitoring/analysis 40% Slovakia 2
Formal fraud risk assessments 37% Slovenia 1
Employee support programs 21% Tajikistan 1
Job rotation/mandatory vacation 21% Median Loss Eastern Europe
Turkeyand Western/Central Asia? 8
Rewards for whistleblowers 12% Ukraine 11
FIG. 62 How does the perpetrator’s level of authority TOTAL CASES 78
relate to occupational fraud in Eastern Europe and

Western/Central Asia?
MEDIAN LOSS:
$823,000
$400,000
USD 190,000
$145,000 $160,000
��
4%
$302,000 OF ALL CASES
executive
78
$80,000
CASES
executive
22%
29%
26% Median loss
4633%% Percent of cases
39% Median loss
Percent of cases
REGIONAL FOCUS | Eastern Europe and Western/Central Asia Occupational Fraud 2022: A Report to the Nations 73
REGIONAL FOCUS
LATIN AMERICA AND

THE CARIBBEAN
What are FIG. 64common

the most What occupational
are the most common
fraud schemes occupational
in Latin fraud
America and the Caribbean? FIG. 65 fraud
How is occupational Howinitially
is occupational fraudand
detected in Latin America initially detected
the Caribbean? in
schemes in Latin America and the Caribbean? Latin America and the Caribbean?
Corruption Tip
59% 41%
Financial statement fraud Internal audit

17% 23%

15% 9%
Billing By accident
13% 6%
Cash on hand Automated transaction/data monitoring

9% 5%
Skimming Account reconciliation

7% 4%
Check and payment tampering External audit

5% 4%

5% 2%
Payroll Notification by law enforcement

4% 2%
Register disbursements Document examination

3% 1%
Expense reimbursements Other

2% 1%
74 REGIONAL FOCUS | Latin America and the Caribbean Occupational Fraud 2022: A Report to the Nations
FIG. 66 What anti-fraud controls are the most common in FIG. 68 Cases by country in Latin America and
Latin America and the Caribbean? the Caribbean

Code of conduct 84% Antigua and Barbuda 2
Internal audit department 81% Argentina 8
External audit of financial statements 76% Aruba 5
Management review 70% Bahamas 1
Management certification of financial statements 69% Barbados 2
Independent audit committee 69% Belize 2
Hotline 67% Bermuda 1
External audit of internal controls over financial reporting 65% Brazil 12
Fraud training for managers/executives 52% Chile 4
Anti-fraud policy 52% Colombia 7
Fraud training for employees 52% Costa Rica 4
Employee support programs 50% Curaçao 1
Dedicated fraud department, function, or team 35% Guyana 1
Formal fraud risk assessments 32% Haiti 1
How doesdata
Proactive themonitoring/analysis
Perpetrator’s level of authority relate30%
to Jamaica 7
Surprise audits fraud in the latin american and the caribbean?
occupational 28% Mexico 22
Job rotation/mandatory vacation 21% Nicaragua 1
Rewards for whistleblowers 5% Panama 1
Peru 5
Suriname 2
FIG. 67 How does the perpetrator’s level of authority relate Trinidad and Tobago 4
to occupational fraud in Latin America and the Caribbean? Median Loss Latin America
Uruguayand the Caribbean? 1
$475,000 Virgin Islands, British 1
TOTAL CASES 95
$275,000
MEDIAN LOSS:
$50,000
USD 175,000
��
executive 5%
OF ALL CASES
95
CASES
24%
34%
Median loss
41%
Percent of cases
REGIONAL FOCUS | Latin America and the Caribbean Occupational Fraud 2022: A Report to the Nations 75
REGIONAL FOCUS
MIDDLE EAST AND

NORTH AFRICA
FIG.most
What are the 69common
Whatoccupational
are the most common
fraud schemes in theoccupational fraud
Middle East and North Africa? FIG. 70 how
How is occupational is occupational
fraud initially fraud
detected in the Middle Eastinitially detected
and North Africa? in
schemes in the Middle East and North Africa? the middle east and north africa?
Corruption Tip
59% 41%
Noncash Internal audit

17% 24%
Billing Management review

16% 9%
Expense reimbursements Account reconciliation

9% 7%
Payroll External audit

9% 5%
Skimming Document examination

9% 4%
Financial statement fraud Automated transaction/data monitoring

8% 4%
Cash on hand Notification by law enforcement

7% 2%
Cash larceny Confession

7% 1%
Check and payment tampering By accident

6% 1%
Register disbursements Other

4% 1%
76 REGIONAL FOCUS | Middle East and North Africa Occupational Fraud 2022: A Report to the Nations
FIG. 71 What anti-fraud controls are the most common FIG. 73 cases by country in the middle east
in the Middle East and North Africa? and north africa

External audit of financial statements 89% Algeria 1
Internal audit department 86% Bahrain 3
Code of conduct 82% Cyprus 4
Management certification of financial statements 79% Egypt 8
Management review 71% Iraq 1
Independent audit committee 71% Jordan 4
External audit of internal controls over financial reporting 70% Kuwait 8
Hotline 68% Lebanon 3
Anti-fraud policy 60% Malta 2
Fraud training for employees 58% Oman 4
Fraud training for managers/executives 54% Qatar 7
Surprise audits 48% Saudi Arabia 29
Dedicated fraud department, function, or team 44% Tunisia 2
Formal fraud risk assessments 43% Median Loss Middle East and North
United ArabAfrica?
Emirates 60
Proactive data monitoring/analysis 43% Yemen 2
Employee support programs 32%
TOTAL CASES 138
FIG. 72 how does the perpetrator’s level of authority relate

to occupational fraud in the middle east and north africa? MEDIAN LOSS:
$186,000
$250,000
USD 186,000
��
7%
$90,000 OF ALL CASES
138
executive
CASES
24%
32%
Median loss
45%
Percent of cases
REGIONAL FOCUS | Middle East and North Africa Occupational Fraud 2022: A Report to the Nations 77
REGIONAL FOCUS
SOUTHERN ASIA
What are FIG. 74 common

What occupational
are the most common occupational fraud FIG. 75fraud
How is occupational
detected in Southernfraud initially detected in
the most fraud schemes in Southern Asia?
How is occupational initially Asia?
schemes in Southern Asia? Southern Asia?
Corruption Tip
71% 51%

18% 16%
Noncash Document examination

15% 9%
Financial statement fraud Management review

15% 7%

12% 5%
Cash larceny Account reconciliation

11% 5%
Expense reimbursements External audit

10% 3%
Skimming Surveillance/monitoring
10% 1%
Check and payment tampering Other

5% 1%

4% 1%
Register disbursements Automated transaction/data monitoring

2% 1%
78 REGIONAL FOCUS | Southern Asia Occupational Fraud 2022: A Report to the Nations
FIG. 76 What anti-fraud controls are the most common FIG. 78 cases by country in southern asia
in Southern Asia?

External audit of financial statements 91% Afghanistan 7
Code of conduct 88% Bangladesh 7
Internal audit department 85% Bhutan 1
External audit of internal controls over financial reporting 85% India 103
Management certification of financial statements 84% Nepal 1
Independent audit committee 76% Median Loss Southern Pakistan
Asia? 10
Management review 72% Sri Lanka 9
Hotline 72%
TOTAL CASES 138
Fraud training for employees 63%
Anti-fraud policy 63%
Dedicated fraud department, function, or team
Surprise audits
53%
48% MEDIAN LOSS:
USD 92,000
��
FIG. 77 How does the perpetrator’s level of authority 7%
relate to occupational fraud in Southern Asia? OF ALL CASES
$225,000
138
CASES
$65,000
$16,000

executive
28% 27%
42% Median loss
Percent of cases
REGIONAL FOCUS | Southern Asia Occupational Fraud 2022: A Report to the Nations 79
REGIONAL FOCUS
SUB-SAHARAN
AFRICA
FIG.
What are the most79 Whatoccupational
common are thefraud
most common
schemes occupational
in Sub-Saharan Africa? fraud FIG. 80 How is occupational fraud initially detected in
schemes in Sub-Saharan Africa? Sub-Saharan
How is occupational Africa?
fraud initially detected in Sub-Saharan Africa?
Corruption Tip
62% 48%

19% 11%

19% 10%
Check and payment tampering Account reconciliation

10% 6%
Financial statement fraud Document examination

9% 6%

8% 5%

7% 4%
Expense reimbursements External audit

6% 4%

5% 2%

5% 2%
Register disbursements Confession

1% 1%
Other
<1%
80 REGIONAL FOCUS | Sub-Saharan Africa Occupational Fraud 2022: A Report to the Nations
FIG. 81 What anti-fraud controls are the most common FIG. 83 cases by country in sub-saharan africa
in Sub-Saharan Africa?
Code of conduct 89% Angola 2

External audit of financial statements 87% Botswana 5
Internal audit department 87% Burkina Faso 1
Management certification of financial statements 83% Burundi 2
Hotline 76% Cameroon 4
External audit of internal controls over financial reporting 76% Democratic Republic of the Congo 11
Independent audit committee 74% Ethiopia 1
Management review 72% Ghana 15
Anti-fraud policy 69% Kenya 49
Fraud training for employees 67% Lesotho 5
Fraud training for managers/executives 62% Liberia 4
Employee support programs 58% Madagascar 4
Dedicated fraud department, function, or team 56% Malawi 9
Formal fraud risk assessments 53% Mali 1
Proactive data monitoring/analysis 47% Mauritius 5
Surprise audits 47% Mozambique 2
Job rotation/mandatory vacation 30% Namibia 3
Rewards for whistleblowers 18% Niger 1
Nigeria 61
Rwanda 2
Senegal 3
Seychelles 1
Sierra Leone 2
FIG. 82 How does the perpetrator’s level of authority Somalia 4
relate to occupational fraud in Sub-Saharan Africa? South Africa 188
South Sudan 1
$215,000 Sudan 1
Swaziland 1
Tanzania 8
Togo 1
Median Loss Sub-Saharan Africa?
Uganda 16
$121,000
Zambia 5
Zimbabwe 11
TOTAL CASES 429

$30,000
MEDIAN LOSS:
USD 100,000
executive
��
23%
18% OF ALL CASES
429
40% 40%
Median loss
Percent of cases
CASES
REGIONAL FOCUS | Sub-Saharan Africa Occupational Fraud 2022: A Report to the Nations 81
REGIONAL FOCUS
UNITED STATES
AND CANADA
What are theFIG.

most84 What
common are thefraud
occupational most common
schemes occupational
in the United fraud
States and Canada? FIG. 85 how is occupational fraud initially detected in
schemes in the United States and Canada? the united
How is occupational statesdetected
fraud initially and canada?
in the United States and Canada?
Corruption Tip
37% 32%

24% 18%

18% 16%
Expense reimbursements By accident

17% 7%
Payroll Surveillance/monitoring
16% 5%
Check and payment tampering Document examination

15% 5%

13% 5%
Cash on hand Account reconciliation

11% 5%
Cash larceny External audit

10% 4%
Financial statement fraud Notification by law enforcement

8% 2%
Register disbursements Confession

4% 1%
Other
1%
82 REGIONAL FOCUS | United States and Canada Occupational Fraud 2022: A Report to the Nations
FIG. 86 What anti-fraud controls are the most common FIG. 88 cases by country in the united
in the United States and Canada? states and canada

Code of conduct 74% Median Loss United States and Canada?
Canada 50
External audit of financial statements 72% United States 625
TOTAL CASES 675
Internal audit department 66%
Management certification of financial statements 65%
External audit of internal controls over financial reporting 63%
Hotline
Management review
63%
63% MEDIAN LOSS:
USD 120,000
Independent audit committee 56%
Fraud training for employees 55%
Anti-fraud policy 51%
��
Dedicated fraud department, function, or team
Surprise audits
41%
35% 36%
Job rotation/mandatory vacation 20% OF ALL CASES
FIG. 87 How does the perpetrator’s level of authority relate 675

to occupational fraud in the United States and Canada?
CASES
$331,000
$122,000
$50,000

executive
24%
37% 38% Median loss
Percent of cases
REGIONAL FOCUS | United States and Canada Occupational Fraud 2022: A Report to the Nations 83
REGIONAL FOCUS
WESTERN EUROPE
FIG.most89common
What are the WHAToccupational
ARE THE MOST COMMON
fraud schemes OCCUPATIONAL
in Western Europe? FIG. 90 HOW IS OCCUPATIONAL FRAUD INITIALLY
FRAUD SCHEMES IN WESTERN EUROPE? How is occupational
DETECTED fraud
INinitially
WESTERN detected in Western Europe?
EUROPE?
Corruption Tip
44% 41%
Noncash Internal audit

24% 16%
Billing Management review

19% 10%
Cash on hand Automated transaction/data monitoring

13% 9%
Financial statement fraud By accident

10% 6%
Expense reimbursements Document examination

10% 6%
Check and payment tampering External audit

9% 5%
Cash larceny Account reconciliation

9% 2%
Payroll Surveillance/monitoring
8% 2%
Skimming Confession
7% 1%
Register disbursements Notification by law enforcement

3% 1%
Other
1%
84 REGIONAL FOCUS | Western Europe Occupational Fraud 2022: A Report to the Nations
FIG. 91 WHAT ANTI-FRAUD CONTROLS ARE THE MOST COMMON FIG. 93 CASES BY COUNTRY IN WESTERN EUROPE
IN WESTERN EUROPE?

External audit of financial statements 90% Aland Islands 1
Code of conduct 84% Andorra 2
Management certification of financial statements 78% Austria 3
External audit of internal controls over financial reporting 77% Belgium 5
Internal audit department 74% Denmark 1
Management review 72% Finland 2
Hotline 68% France 6
Independent audit committee 65% Germany 24
Fraud training for employees 59% Greece 27
Fraud training for managers/executives 58% Ireland 3
Anti-fraud policy 56% Italy 17
Formal fraud risk assessments 52% Luxembourg 1
Employee support programs 51% Netherlands 12
Proactive data monitoring/analysis 48% Norway 1
Dedicated fraud department, function, or team 47% Spain 13
Surprise audits 40% Switzerland
Median Loss Western Europe? 6
Job rotation/mandatory vacation 25% United Kingdom 21
TOTAL CASES 145
FIG. 92 HOW DOES THE PERPETRATOR’S LEVEL OF AUTHORITY

RELATE TO OCCUPATIONAL FRAUD IN WESTERN EUROPE?
MEDIAN LOSS:
USD 173,000
$400,000
��
$145,000 $160,000 8%
OF ALL CASES

executive
145
CASES
22%
29%
Median loss
46% Percent of cases
REGIONAL FOCUS | Western Europe Occupational Fraud 2022: A Report to the Nations 85
STATISTICAL APPENDIX
Cases 25th percentile Median (50th) 75th percentile Mean*
ALL CASES† 2,046 $20,000 $117,000 $600,000 $1,783,000

Schemes
Asset misappropriation 1,605 $20,000 $100,000 $500,000 $1,203,000
Noncash 284 $10,000 $78,000 $500,000 $921,000
Billing 281 $20,000 $100,000 $500,000 $852,000
Expense reimbursements 140 $10,000 $40,000 $100,000 $152,000
Skimming 137 $10,000 $50,000 $188,000 $185,000
Check and payment tampering 135 $26,000 $100,000 $500,000 $1,020,000
Cash on hand 129 $5,000 $15,000 $100,000 $131,000
Payroll 117 $10,000 $45,000 $185,000 $201,000
Cash larceny 103 $10,000 $45,000 $389,000 $6,920,000
Register disbursements 25 $5,000 $10,000 $42,000 $33,000
Corruption 906 $25,000 $150,000 $1,000,000 $2,647,000
Financial statement fraud 150 $100,000 $593,000 $6,000,000 $50,482,000
Detection method
Tip 810 $25,000 $117,000 $650,000 $1,754,000
Internal audit 306 $20,000 $108,000 $500,000 $1,245,000
Management review 235 $20,000 $105,000 $500,000 $1,340,000
Document examination 107 $37,000 $200,000 $1,500,000 $2,256,000
By accident 105 $25,000 $100,000 $730,000 $1,293,000
Account reconciliation 91 $10,000 $74,000 $370,000 $985,000
Automated transaction/data monitoring 85 $10,000 $50,000 $203,000 $696,000
External audit 73 $56,000 $219,000 $1,224,000 $3,490,000
Surveillance/monitoring 51 $5,000 $60,000 $350,000 $1,127,000
Notification by law enforcement 34 $148,000 $500,000 $6,150,000 $5,185,000
Confession 16 $29,000 $159,000 $8,375,000 $5,521,000
*Mean amounts were calculated using loss data that was winsorized at 5% (i.e., assigned all cases in the top 2.5% and bottom 2.5% the same value as
the 97.5th percentile and 2.5th percentile, respectively).
†Loss calculations were omitted for categories with fewer than ten responses.
86 STATISTICAL APPENDIX Occupational Fraud 2022: A Report to the Nations

Victim organization
Region:
United States and Canada 663 $20,000 $120,000 $649,000 $1,460,000
Sub-Saharan Africa 425 $15,000 $100,000 $352,000 $1,841,000
Asia-Pacific 188 $15,000 $121,000 $723,000 $2,310,000
Western Europe 140 $60,000 $173,000 $577,000 $1,152,000
Middle East and North Africa 136 $42,000 $186,000 $875,000 $2,093,000
Southern Asia 130 $10,000 $92,000 $500,000 $1,490,000
Latin America and the Caribbean 94 $33,000 $175,000 $915,000 $1,550,000
Eastern Europe and Western/Central Asia 78 $42,000 $190,000 $1,125,000 $1,669,000
Organization type:
Private company 851 $20,000 $120,000 $550,000 $1,389,000
Public company 484 $25,000 $118,000 $735,000 $1,694,000
Nonprofit 180 $14,000 $60,000 $266,000 $851,000
Government 346 $20,000 $138,000 $800,000 $2,522,000
National 157 $40,000 $200,000 $1,450,000 $3,319,000
State/provincial 91 $15,000 $56,000 $503,000 $2,306,000
Local 84 $17,000 $125,000 $521,000 $1,370,000
Organization size:
<100 employees 423 $25,000 $150,000 $550,000 $1,373,000
100–999 employees 468 $20,000 $100,000 $500,000 $1,641,000
1,000–9,999 employees 543 $16,000 $100,000 $500,000 $1,704,000
10,000+ employees 476 $24,000 $138,000 $900,000 $1,973,000
Organization revenue:
<$50 million 720 $20,000 $100,000 $400,000 $1,027,000
$50 million–$499 million 496 $20,000 $105,000 $644,000 $1,821,000
$500 million–$999 million 222 $27,000 $150,000 $1,150,000 $2,840,000
$1 billion+ 455 $25,000 $150,000 $973,000 $2,076,000
Industry:
Banking and financial services 341 $15,000 $100,000 $368,000 $1,739,000
Government and public administration 193 $20,000 $150,000 $1,450,000 $2,555,000
Manufacturing 191 $35,000 $177,000 $1,000,000 $1,755,000
Health care 126 $18,000 $100,000 $600,000 $1,392,000
Energy 95 $30,000 $100,000 $1,000,000 $1,793,000
Retail 89 $15,000 $65,000 $375,000 $1,024,000
Insurance 88 $20,000 $130,000 $500,000 $1,235,000
Technology 82 $34,000 $150,000 $735,000 $952,000
Transportation and warehousing 79 $37,000 $250,000 $1,000,000 $2,071,000
Construction 75 $35,000 $203,000 $1,143,000 $2,868,000
Education 67 $10,000 $56,000 $306,000 $1,022,000
Religious, charitable, or social services 58 $20,000 $78,000 $275,000 $323,000
Information (e.g., publishing, media, telecommunications) 58 $20,000 $58,000 $500,000 $714,000
Food service and hospitality 50 $10,000 $55,000 $388,000 $579,000
Services (professional) 41 $33,000 $125,000 $625,000 $1,716,000
Real estate 40 $50,000 $435,000 $1,875,000 $2,342,000
Arts, entertainment, and recreation 40 $10,000 $73,000 $475,000 $1,169,000
Agriculture, forestry, fishing, and hunting 39 $15,000 $154,000 $1,500,000 $2,114,000
Services (other) 31 $15,000 $100,000 $268,000 $417,000
Utilities 30 $34,000 $200,000 $1,194,000 $3,043,000
Wholesale trade 27 $50,000 $400,000 $1,000,000 $2,143,000
Mining 22 $45,000 $175,000 $965,000 $662,000
STATISTICAL APPENDIX Occupational Fraud 2022: A Report to the Nations 87

Perpetrator
Number of perpetrators:
One perpetrator 773 $12,000 $57,000 $269,000 $896,000
Two perpetrators 360 $29,000 $145,000 $750,000 $1,499,000
Three or more perpetrators 691 $42,000 $219,000 $1,300,000 $2,638,000
Position:
Employee 671 $10,000 $50,000 $200,000 $623,000
Manager 699 $28,000 $125,000 $600,000 $1,265,000
Owner/executive 411 $80,000 $337,000 $2,380,000 $3,928,000
Tenure:
>10 years 359 $50,000 $250,000 $1,200,000 $2,357,000
6–10 years 448 $27,000 $137,000 $500,000 $1,568,000
1–5 years 839 $15,000 $100,000 $450,000 $1,439,000
<1 year 162 $6,000 $50,000 $305,000 $1,480,000
Department:
Operations 269 $14,000 $74,000 $500,000 $1,133,000
Accounting 224 $43,000 $155,000 $500,000 $847,000
Executive/upper management 202 $100,000 $500,000 $3,625,000 $4,950,000
Sales 200 $25,000 $100,000 $460,000 $998,000
Customer service 136 $10,000 $40,000 $248,000 $765,000
Purchasing 130 $33,000 $129,000 $700,000 $1,672,000
Administrative support 129 $19,000 $90,000 $298,000 $421,000
Finance 93 $31,000 $160,000 $1,000,000 $1,324,000
Manufacturing and production 63 $14,000 $100,000 $550,000 $1,128,000
Warehousing/inventory 58 $17,000 $116,000 $750,000 $939,000
Board of directors 55 $100,000 $500,000 $10,000,000 $7,024,000
Information technology 53 $25,000 $150,000 $625,000 $2,240,000
Facilities and maintenance 44 $6,000 $58,000 $475,000 $1,143,000
Marketing/public relations 34 $4,000 $112,000 $850,000 $895,000
Human resources 27 $38,000 $100,000 $165,000 $136,000
Research and development 17 $18,000 $75,000 $575,000 $2,554,000
Gender
Male 1,311 $25,000 $125,000 $700,000 $1,961,000
Female 480 $15,000 $100,000 $382,000 $753,000
Age
<26 78 $5,000 $40,000 $200,000 $836,000
26-30 174 $6,000 $36,000 $154,000 $388,000
31-35 261 $12,000 $80,000 $300,000 $778,000
36-40 348 $20,000 $100,000 $500,000 $1,235,000
41-45 315 $40,000 $185,000 $900,000 $1,376,000
46-50 233 $34,000 $200,000 $600,000 $2,013,000
51-55 151 $49,000 $300,000 $1,800,000 $3,347,000
56-60 89 $73,000 $347,000 $1,802,000 $3,153,000
>60 47 $125,000 $800,000 $7,978,000 $6,487,000
Education level
High school graduate or less 289 $10,000 $65,000 $350,000 $1,196,000
Some university 228 $24,000 $115,000 $543,000 $1,469,000
University degree 681 $25,000 $150,000 $641,000 $1,729,000
Postgraduate degree 251 $33,000 $135,000 $1,000,000 $2,613,000
88 STATISTICAL APPENDIX Occupational Fraud 2022: A Report to the Nations

INDEX OF FIGURES
Age of Perpetrator Which HR-related issues are most commonly experienced by

fraud perpetrators? 59
How does the perpetrator’s age relate to occupational fraud? 54
Case Results
Anti-Fraud Controls
Spotlight: A Decade of Occupational Fraud: Trends
Spotlight: A Decade of Occupational Fraud: Trends from 2012–2022 18–19
from 2012–2022 18–19
Spotlight: How Does Tenure Affect Fraud Risk? 48–49
Spotlight: COVID’s Effect on Occupational Fraud 40
How do victim organizations punish fraud perpetrators? 62
Did the background checks reveal existing red flags? 41
Spotlight: Response to Fraud 63
Spotlight: Hotline and Reporting Mechanism Effectiveness 24–25
Cost of Fraud
How do anti-fraud controls vary by size of victim organization? 38
from 2012–2022 18–19
How does the perpetrator’s age relate to occupational fraud? 54
How does the perpetrator’s education level relate to Spotlight: Hotline and Reporting Mechanism Effectiveness 24–25
occupational fraud? 55
How does an organization’s gross annual revenue relate to its
occupational fraud risk? 30
How does the presence of anti-fraud controls relate to median loss? 36
How does the presence of anti-fraud controls relate to the How does an organization’s size relate to its occupational fraud risk? 29
duration of fraud? 37
How does detection method relate to fraud loss and duration? 23
Spotlight: Modifying Anti-Fraud Controls Following a Fraud 39
How do gender distribution and median loss vary based on the
perpetrator’s level of authority? 53
Top 3 internal control weaknesses based on the perpetrator’s position 43
How does occupational fraud affect organizations in
Was a background check run on the perpetrator prior to hiring? 41 different industries? 32
What anti-fraud controls are most common? 34 Spotlight: How Does Tenure Affect Fraud Risk? 48–49
What anti-fraud controls are the most common in various regions? 70–85 How does the duration of a fraud relate to median loss? 13
What are the primary internal control weaknesses that contribute to How does the number of perpetrators in a scheme relate to
occupational fraud? 42 occupational fraud? 56
What types of background checks were run on the perpetrator
prior to hiring? 41 How does the perpetrator’s gender relate to occupational fraud? 51
How does the perpetrator’s level of authority relate to
Behavioral Red Flags of Perpetrator occupational fraud? 45
Spotlight: Behavioral Red Flags of Fraud 60–61
How does the perpetrator’s tenure relate to occupational fraud? 46
Do fraud perpetrators experience negative HR-related issues
prior to or during their frauds? 59 How does the presence of anti-fraud controls relate to median loss? 36
Spotlight: How Does Tenure Affect Fraud Risk? 48–49 How is occupational fraud committed? 9
How often do perpetrators exhibit behavioral red flags? 58 Spotlight: Modifying Anti-Fraud Controls Following a Fraud 39
INDEX OF FIGURES Occupational Fraud 2022: A Report to the Nations 89

Spotlight: The Global Cost of Fraud 8 How does the perpetrator’s level of authority relate to
scheme duration? 45
What departments pose the greatest risk for occupational fraud? 47
How does the presence of anti-fraud controls relate to the
What is the typical velocity (median loss per month) of different duration of fraud? 37
occupational fraud schemes? 15
How long do different occupational fraud schemes last? 14
What levels of government are victimized by occupational fraud? 28
What types of organizations are victimized by occupational fraud? 28 Education Level of Perpetrator
How does the perpetrator’s education level relate to
Which asset misappropriation schemes present the greatest risk? 12 occupational fraud? 55
Concealment of Fraud Schemes Gender of Perpetrator

Spotlight: How Do Perpetrators Conceal Their Frauds? 17
from 2012–2022 18–19
Criminal and Employment Background
of Perpetrator Spotlight: Behavioral Red Flags of Fraud 60–61
Do perpetrators tend to have prior employment-related disciplinary
How does the gender distribution of perpetrators vary by region? 52
actions for fraud? 57
Do perpetrators tend to have prior fraud convictions? 57 How does the perpetrator’s gender relate to occupational fraud? 51
Demographics of Survey Participants perpetrator’s level of authority? 53
How many fraud cases have survey participants investigated in the
past two years? 69
Geographical Region of Victim Organization
How much fraud examination experience did survey
participants have? 69 Reported cases by region 7
What was the primary occupation of survey participants? 67 Spotlight: Hotline and Reporting Mechanism Effectiveness 24–25
How does the gender distribution of perpetrators vary by region? 52

What was the professional role of the survey participants? 68
Asia-Pacific 70–71
Department of Perpetrator Eastern Europe and Western/Central Asia 72–73
What are the most common occupational fraud schemes in Latin America and the Caribbean 74–75
high-risk departments? 50 Middle East and North Africa 76–77
What departments pose the greatest risk for occupational fraud? 47 Southern Asia 78–79
Sub-Saharan Africa 80–81
Detection Method United States and Canada 82–83
Spotlight: Hotline and Reporting Mechanism Effectiveness 24–25 Western Europe 84–85
How does detection method relate to fraud loss and duration? 23

Industry of Victim Organization
How is occupational fraud initially detected? 22
How does occupational fraud affect organizations in different
industries? 32
How is occupational fraud initially detected in various regions? 70–85
What are the most common occupational fraud schemes in various
To whom did whistleblowers initially report? 27 industries? 33
What formal reporting mechanisms did whistleblowers use? 26

Number of Perpetrators
Who reports occupational fraud? 22 Spotlight: A Decade of Occupational Fraud: Trends
from 2012–2022 18–19
Duration of Fraud Spotlight: How Does Tenure Affect Fraud Risk? 48–49
Spotlight: COVID’s Effect on Occupational Fraud 40 How does the number of perpetrators in a scheme relate to
How does detection method relate to fraud loss and duration? 23 Position of Perpetrator
Spotlight: How Does Tenure Affect Fraud Risk? 48–49 from 2012–2022 18–19
How does the duration of a fraud relate to median loss? 13 Spotlight: Behavioral Red Flags of Fraud 60–61
90 INDEX OF FIGURES Occupational Fraud 2022: A Report to the Nations

Spotlight: How Does Tenure Affect Fraud Risk? 48–49 What are the most common occupational fraud schemes in various
industries? 33
How does the perpetrator’s level of authority relate to
occupational fraud? 45 What are the most common occupational fraud schemes in various
How does the perpetrator’s level of authority relate to regions? 70–85
occupational fraud in various regions? 70–85 What is the typical velocity (median loss per month) of different
How does the perpetrator’s level of authority relate to occupational fraud schemes? 15
scheme duration? 45 Which asset misappropriation schemes present the greatest risk? 12
perpetrator’s level of authority? 53 Size of Victim Organization
Spotlight: Response to Fraud 63
How does an organization’s gross annual revenue relate to its
Top 3 internal control weaknesses based on the
occupational fraud risk? 30
perpetrator’s position 43
How does an organization’s size relate to its occupational fraud risk? 29
Scheme Type How do anti-fraud controls vary by size of victim organization? 38
from 2012–2022 18–19 How do fraud schemes vary by organization size? 31
Among frauds involving cryptocurrency, how was it used? 20
Tenure of Perpetrator
How do fraud schemes vary by organization size? 31 Spotlight: How Does Tenure Affect Fraud Risk? 48–49
How is occupational fraud committed? 9
How does the perpetrator’s tenure relate to occupational fraud? 46
How long do different occupational fraud schemes last? 14
How often do fraudsters commit more than one type of Type of Victim Organization
Spotlight: Modifying Anti-Fraud Controls Following a Fraud 39
Occupational Fraud and Abuse Classification System (The Fraud Tree) 10
What are the most common occupational fraud schemes in high-risk What levels of government are victimized by occupational fraud? 28
departments? 50
Spotlight: Response to Fraud 63 What types of organizations are victimized by occupational fraud? 28
INDEX OF FIGURES Occupational Fraud 2022: A Report to the Nations 91

5. Are fraud risk assessments performed to pro- 10. Is an open-door policy in place that allows
actively identify and mitigate the company’s employees to speak freely about pressures,
vulnerabilities to internal and external fraud? providing management the opportunity to
❑ Are fraud risk assessments updated regular- alleviate such pressures before they become
ly (e.g., annually), as well as following times acute?
of notable organizational or environmental
changes? 11. Are regular, anonymous surveys conducted to
assess employee morale?
❑ Are the results of the fraud risk assessment
shared with appropriate levels of manage-
ment and used to update the organization’s
anti-fraud program and controls?
6. Are strong anti-fraud controls in place and

operating effectively, including the following?
❑ Proper separation of duties
❑ Use of authorizations
❑ Physical safeguards
❑ Job rotations
❑ Mandatory vacations
7. Does the internal audit department, if one

exists, have adequate resources and authority
to operate effectively and without undue influ-
ence from senior management?
8. Does the hiring policy include the following

(where permitted by law)?
❑ Past employment verification
❑ Criminal and civil background checks
❑ Credit checks
❑ Drug screening
❑ Education verification
❑ References checks
9. Are employee support programs in place to

assist employees struggling with addiction,
mental/emotional health, family, or financial
problems?
Fraud Prevention Checklist Occupational Fraud 2022: A Report to the Nations 93

GLOSSARY OF TERMINOLOGY
Asset misappropriation: A scheme in which an employee of material information in the organization’s financial
steals or misuses the employing organization’s resources reports (e.g., employee files fraudulent expense report
(e.g., theft of company cash, false billing schemes, or claiming personal travel or nonexistent meals)
inflated expense reports)
Fraudulent disbursement scheme: A scheme in which
Billing scheme: A fraudulent disbursement scheme in an employee makes a distribution of organizational
which a person causes their employer to issue a payment funds or manipulates a disbursement/payment function
by submitting invoices for fictitious goods or services, for a dishonest purpose (e.g., submitting false invoices
inflated invoices, or invoices for personal purchases (e.g., for payment, altering time cards, or making personal
employee creates a shell company and bills employer purchases with company funds)
for services not actually rendered; employee purchases
personal items and submits an invoice to employer for Hotline: A mechanism to report fraud or other violations,
payment) whether managed internally or by an external party.
This might include telephone hotlines, dedicated email
Cash larceny: A scheme in which an incoming payment addresses, web-based platforms, and other mechanisms
is stolen from an organization after it has been recorded established to facilitate fraud reporting.
on the organization’s books and records (e.g., employee
steals cash and checks from daily receipts before they can Management review: The process of management
be deposited in the bank) reviewing organizational controls, processes, accounts,
or transactions for adherence to company policies and
Cash-on-hand misappropriations: A scheme in which expectations
the perpetrator misappropriates cash kept on hand at the
victim organization’s premises (e.g., employee steals cash Noncash misappropriations: A scheme in which an
from a company vault) employee steals or misuses noncash assets of the victim
organization (e.g., employee steals inventory from a
Check or payment tampering scheme: A fraudulent warehouse or storeroom; employee steals or misuses
disbursement scheme in which a person steals their confidential customer information)
employer’s funds by intercepting, forging, or altering
a check or electronic payment drawn on one of the Occupational fraud: The use of one’s occupation for
organization’s bank accounts (e.g., employee steals blank personal enrichment through the deliberate misuse or
company checks and makes them out to themself or an misapplication of the employing organization’s resources
accomplice; employee re-routes an outgoing electronic or assets
payment to a vendor to be deposited into their own bank
account) Payroll scheme: A fraudulent disbursement scheme in
which an employee causes their employer to issue a
Corruption: A scheme in which an employee misuses their payment by making false claims for compensation (e.g.,
influence in a business transaction in a way that violates employee claims overtime for hours not worked; employee
their duty to the employer in order to gain a direct or adds ghost employees to the payroll)
indirect benefit (e.g., schemes involving bribery or conflicts
of interest) Primary perpetrator: The person who worked for the
victim organization and who was reasonably confirmed as
Employee support programs: Programs that provide the primary culprit in the case
assistance to employees dealing with personal issues
or challenges, such as counseling services for addiction, Register disbursements scheme: A fraudulent
family, or financial problems disbursement scheme in which an employee makes
false entries on a cash register to conceal the fraudulent
Expense reimbursements scheme: A fraudulent removal of cash (e.g., employee fraudulently voids a sale
disbursement scheme in which an employee makes a on a cash register and steals the cash)
claim for reimbursement of fictitious or inflated business
expenses (e.g., employee files fraudulent expense report Skimming: A scheme in which an incoming payment is
claiming personal travel or nonexistent meals) stolen from an organization before it is recorded on the
organization’s books and records (e.g., employee accepts
Financial statement fraud: A scheme in which an payment from a customer but does not record the sale and
employee intentionally causes a misstatement or omission instead pockets the money)
94 Glossary of Terminology Occupational Fraud 2022: A Report to the Nations

ABOUT THE ACFE
Founded in 1988 by Dr. Joseph T. Wells, CFE, CPA, the Association of Certified Fraud
Examiners (ACFE) is the world’s largest anti-fraud organization and premier provider
of anti-fraud training and education. Together with more than 90,000 members, the
ACFE is reducing business fraud worldwide and inspiring public confidence in the
integrity and objectivity within the profession.
The ACFE unites and supports the global anti-fraud community by providing
educational tools and practical solutions for professionals through events,
publications, networking, and educational materials for colleges and universities.
CERTIFIED FRAUD EXAMINERS

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How Does The Presence of Anti-Fraud Controls Relate To Median Loss?

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How Does The Presence of Anti-Fraud Controls Relate To Median Loss?

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$150,000

Control Percent Control Control not Percent

Median months to detection

Percent Control Control not Percent

FIG. 25 how do anti-fraud controls vary by size of victim organization?

External audit of financial statements 53%

38 VICTIM ORGANIZATIONS Occupational Fraud 2022: A Report to the Nations

DID VICTIM ORGANIZATIONS MODIFY THEIR $120,000

Did not modify

MOST COMMON CHANGES MADE

75% 64% 54% 48% 42%

Management Proactive data Surprise audits Internal audit Anti-fraud training

WHICH TYPES OF ORGANIZATIONS WERE MOST LIKELY

We asked survey participants whether several

TO WHAT EXTENT DID PANDEMIC-RELATED FACTORS

Organizational staffing changes 12% 16% 14% 58%

Operational process changes 12% 14% 13% 60%

Internal control changes 13% 14% 12% 61%

Shift to remote work 15% 14% 9% 62%

Changes to strategic priorities 10% 12% 12% 65%

Technology challenges 9% 11% 10% 69%

Changes to anti-fraud program 8% 11% 11% 70%

Supply chain disruptions 9% 11% 10% 71%

Significant factor Moderate factor Slight factor Not a factor

12 Consequently, we anticipate seeing additional pandemic-related factors underlying

FIG. 26 was a background check run on the perpetrator prior to hiring?

43% FIG. 27 did the background checks

VICTIM ORGANIZATIONS Occupational Fraud 2022: A Report to the Nations 41

Lack of internal controls 29%

Override of existing controls 20%

Lack of management review 16%

Poor tone at the top 10%

42 VICTIM ORGANIZATIONS Occupational Fraud 2022: A Report to the Nations

PLOYEE 34% Manager 29% owner/e

nager 29% owner/executive 23%

VICTIM ORGANIZATIONS Occupational Fraud 2022: A Report to the Nations 43

Employee Manager Owner/executive Other

Perpetrators Occupational Fraud 2022: A Report to the Nations 45

FIG. 33 how does the perpetrator’s tenure relate to occupational fraud?

<1 year 1–5 years 6–10 years >10 years

46 PERPETRATORS Occupational Fraud 2022: A Report to the Nations

Board of directors Executive/upper

Board of directors Executive/upper

Less risk More risk

Long-tenured FRAUDSTERS Even when COMPARING FRAUDSTERS

≤5 years >10 years ≤5 years >10 years

Long-tenured fraudsters are Long-tenured fraudsters

48 HOW DOESPerpetrators Report

≤5 years >10 years ≤5 years >10 years

These 6 RED FLAGS were much more

15% 15% 15%

≤5 years >10 years

Check and payment tampering

Financial statement fraud

Operations 273 16% 7% 8% 11% 48% 9% 6% 16% 8% 1% 6%

Sales 203 11% 6% 7% 2% 51% 8% 6% 18% 4% 2% 11%

Customer service 140 8% 10% 16% 11% 44% 6% 7% 17% 6% 3% 10%

Purchasing 131 27% 1% 4% 2% 82% 5% 2% 14% 3% 0% 2%

Finance 95 26% 7% 11% 12% 48% 20% 14% 12% 7% 3% 12%

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