Whistle Blowers……….it is time for you to step forward!

According to the just released PricewaterhouseCoopers South African edition of the Global Economic Crime Survey, 77% of all internal fraud is committed by senior or middle management and their primary motivation is greed, in the case of senior managers, and perceived injustice, in the case of junior managers. The number of South African senior managers committing fraud is double the global number.

The profile of a typical fraudster is as follows:

  • Male
  • Age 31 – 40
  • Education – university degree
  • Employment period – more than 10 years

(Source – 5128 respondents across 93 countries, of which 35% worked at listed companies, 9% in the public sector and 50% in private companies)

4 out of 134 South African respondents reported losing more than R1 billion each!

The types of economic crime reported by the South African respondents were:

  • Asset Misappropriation – 77%
  • Procurement Fraud – 59%
  • Bribery & Corruption 52% (Was 42% In 2011)
  • Human Resources Fraud – 42%
  • Financial Statement Fraud – 35%
  • Cybercrime – 26%
  • Money Laundering – 14%
  • Tax Fraud – 11%
  • Illegal Insider Trading Fraud – 9%

Globally, governments accounted for 46% of procurement fraud, closely followed by energy, utilities and mining (43%) and engineering and construction (42%).

In addition, Institute of Accountability director, Paul Hoffman, estimates that corruption has cost South Africa R700 billion over the last 20 years and R30 billion is stolen annually through the government tendering system.

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