New Delhi: Emerging markets, including India, "surprisingly" recorded low level of economic crime among 78 countries in the past year due to ineffective fraud detection methods, says a report by PwC. (Agencies)
The report titled 'Global Economic Crime Survey' said India's incidence of economic crime of 24 percent in 2011 was much lower than the global average of 34 percent. The level of fraud in the country has increased from 18 percent it found in the last survey in 2009.
Kenya recorded the highest level of economic crime in the 12 months with 66 of respondents saying their organizations were victims of economic crime.
"Certain growing markets surprisingly reported low levels of fraud (below 25 percent) – namely Indonesia, India, Romania and Greece. This might be because their fraud detection methods are ineffective and/or their respondents are reluctant to report fraud," the report said.
Japan had the least economic crime, followed by Indonesia, Slovenia, Greece, Italy, the Netherlands, Switzerland, Turkey, Slovakia, Sweden, India and Romania.
The territories that reported high levels of fraud (40 percent or more) include Kenya, followed by South Africa, the UK, New Zealand, Spain, Australia, Argentina, France, the US, Malaysia and Mexico.
The survey which was conducted among 3,877 senior executives from organisations in 78 countries, noted that no industry sector is immune to economic crime, but communication and insurance sectors reported the highest incidence of fraud (both at 48 percent).
In addition, it said that fraud against governments or state-owned enterprises rose by 24 percent since 2009, moving it ahead of the hospitality and leisure and financial services sectors as a target for crime.
"Economic crime continues to be pervasive, affecting both large and small organisations worldwide without discrimination. No industry or company in any country is immune to impact of fraud," PwC Forensics Practice (UK) Partner Tony Parton said.
Theft or asset misappropriation (cited by 72 percent) was the most common type of economic crime reported, followed by accounting fraud and bribery and corruption (24 percent each) and cybercrime (23 percent).
The survey said that most economic crime of all types is committed by internal fraudsters.
Interestingly, the report found that economic crime is most prevalent at large organisations as 54 percent of respondents from organisations with more than 1,000 employees reported incidents in the last 12 months, compared with 29 percent among those with less than 1,000, and 17 percent among those with less than 200.
However, the direct cost of economic crime to an organisation can be difficult to gauge, nearly 10 percent of victims reported losses of more than USD 5 million.
New Delhi: Emerging markets, including India, "surprisingly" recorded low level of economic crime among 78 countries in the past year due to ineffective fraud detection methods, says a report by PwC.