34% of respondents reported fraud and/or economic crime in their organisations in the last 2 years, up from 26% in 2016.

Internal audit led the way in discovering 20% of the most disruptive fraud and/or economic crime experienced by respondents followed closely by internal tip-off’s (18%).

The most disruptive crime experienced by organisations has cost 46% of respondents between US$100,000 - US$50 million.29% of organisations think that cybercrime is likely to be the most disruptive fraud and/or economic crime in the next 24 months.

82% of respondents agree that the use of continuous real-time monitoring assists their organisation in combating fraud and/or economic crime.

Dubai, UAE – PwC has been monitoring trends in fraud and economic crime throughout the region since 2011.  Today we launch our “2018 Middle East Economic Crime and Fraud Survey - Pulling fraud out of the shadows”, which analyses feedback from organisations across the region on this issue.

The study showed a significant increase in the number of financial fraud cases at 34% compared to 26% in 2016. Asset misappropriation, business misconduct and fraud committed by consumers are the three most frequent types of fraud and/or economic crime reported by respondents. Internal Audit was the main contributor to detecting the most disruptive fraud experienced by respondents in the last 24 months (20%) followed by internal tip-off’s (18%), fraud risk management and suspicious activity monitoring (both at 14%).

Organisations are realising the rising value of anti-fraud technologies, and are looking to extend their investment and usage of it.

Nick Robinson,  Forensic Leader at PwC Middle East said:
“Social and environmental pressures are increasing the focus on fraud and economic crime issues across the region.  This rise is unsurprising as these issues are becoming more acute within organisations. This increased awareness is clearly articulated in the survey findings as 34% of respondents reported fraud and/or economic crime incidents in the last 24 months.”

Adding “Technology is proving to be a strong ally. Organisations in the Middle East are making growing use of technology in their anti-fraud efforts, with 82% agreeing that using technology for real time monitoring assists in combating fraud.”

Fraud instigated by internal fraud actors is increasing rapidly, accounting for 48% of economic crimes reported in the Middle East slightly below the global average of 52%. Senior and middle management are the main perpetrators of internal frauds, accounting for 62% of those reported.

Our study shows that the proportion of organisations that have performed a fraud and economic crime risk assessment within the past 24 months has leapt to 77% in 2018 from 47% in 2016.

Tareq Haddad, Investigations Leader at PwC Middle East commented on the survey: “Preventing and discovering fraud in organisations is not an easy task. It involves a focus on culture and people, in addition to investing in controls and technology. Organisations in the Middle East having formal business ethics and compliance programs increased from 79% to 82% in the last 24 months. In addition, the results of the survey emphasize on the need to think outside the box when designing controls where 52% of respondents pointed to the use of email monitoring as a valuable techniques in combating fraud.”

To tackle fraud, 42% of Middle East organisations have reportedly increased the amount of money allocated to combating fraud and economic crime within the past 24 months, the same proportion as at a global level. And 49% plan to increase it in the next 24 months, ahead of the global figure of 44% – indicating that the focus on fraud is set to rise more quickly in the Middle East than elsewhere.

Over the past 24 months, disruptive economic crime has cost 46% of respondent organisations between US$100,000 - US$50 million dollars.“ Our 2018 Middle East Economic Crime and Fraud survey highlights the need for organisations to take proactive steps towards understanding fraud more comprehensively by uncovering fraud blind spots and taking necessary action to prevent it,” concluded Nick Robinson,  Forensic Leader at PwC Middle East.

For the full report: https://www.pwc.com/me/crimeandfraudsurvey

© Press Release 2018