White-collar crime: the typical fraudster

in Advisory, 07.06.2016

Fraud is a global scourge that harms corporate reputations, costs millions and ruins lives. It is a heavy economic and moral burden on society. Criminal activities of this nature are taking their toll on numerous companies in Switzerland, too. Yet what does a typical fraudster look like? KPMG took a closer look at this question within the scope of an international study ‘Profile of a Fraudster’. In Switzerland, the profile looked like this:

Characteristics of a typical white-collar offender in Switzerland

  • Over half of the fraudsters investigated are between 46 and 55 years of age.
  • 82% of the perpetrators are male.
  • 64% of all fraudsters come from within the company’s own ranks, i.e. they are employed by the victim organization (61% in 2013).
  • 55% of the perpetrators are members of senior management.
  • 36% have been employed by the company for at least six years (2013: 41%).
  • One out of every five fraudsters (18%) is described as having an autocratic personality.
  • On the other hand, white-collar offenders are three times as likely to be perceived as friendly rather than unfriendly.
  • The overriding motives for fraudsters’ activities are personal financial gain to finance their lifestyle (64%), greed (18%) and a sense that the crime could be easily committed (18%).

Characteristics of a fraudster

Technology helps and hinders fraudsters

The potential for misuse is rising hand in hand with technological advances: While perpetrators are already employing extremely effective technological tools, businesses are doing very little in terms of using technology to curb criminal activities.

How technology was used to perpetrate the fraud

Both in Switzerland and around the globe, technically adept fraudsters are using technology in many different ways to enable their activities. Of all of the cases of technology-enabled fraud investigated in Switzerland, around 27% of these concerned false or misleading information in accounting records and 27% related to fraudulent e-mails. Another 9% involved the abuse of existing access rights to computer systems.

Weak controls fuel the fraud

For 64% of all fraudsters, weak internal controls are a key factor that is gaining importance: The number of fraudsters whose criminal activities are greatly facilitated by weak controls rose sharply to 27%, up from 18% in 2013.

Factors contributing to the facilitation of the fraud

Yet even the best controls cannot provide 100% protection against fraud: The control systems were circumvented in 16% of the cases investigated. In another 20% of the cases, they played no role at all; the perpetrators were not concerned about the control mechanisms in place and simply disregarded these as they defrauded the company.



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