International Fraud Awareness Week (“Fraud Week”) is November 15 through 21, 2015. Fraud Week is sponsored by the Association of Certified Fraud Examiners’ (“ACFE”) and is dedicated to fraud awareness, detection and prevention. Organizations can help control fraud by establishing and communicating a fraud policy, increasing the awareness of fraud within an organization and using anti-fraud measures such as establishing a fraud investigation team. The basic objective of an organization’s fraud investigation team is to preserve the integrity of the organization and to mitigate losses due to fraud.
The ACFE’s latest report, Benchmarking Your In-House Fraud Investigation Team, provides benchmarking information for those within an organization who work as a part of an in-house team that performs fraud examinations and highlights industry best practices. This report was based on statistics from ACFE members who work on internal investigation teams, including the team’s structure and performance.
The ACFE found that the average number of fraud investigators per thousand employees is 5.1 across all industries. However, when this data is broken down by industry, as shown below, it is interesting to note that religious, charitable or social services organizations and government and public administration entities have relatively high ratios of staff members assigned to investigate potential fraud when compared to other industries. This highlights the significant level of fraud risk faced by these organizations and their efforts to mitigate that risk (note that industries with asterisks had fewer than 10 responses which makes their ratios less reliable).
Average Number of Fraud Investigators by Industry
Highlights from the ACFE’s Report, Benchmarking Your In-House Fraud Investigation Team
Investigation teams that implement formal performance evaluation metrics tend to see better outcomes. The investigation teams that did not report any formal performance metrics also reported the lowest percentage of fraud losses recovered.
Internal fraud investigation teams report to a variety of oversight parties; however, the single-most common party to which investigation teams report is the head of internal audit.
The ACFE Benchmarking report can help support the effectiveness of an internal investigation team and highlight its success to management. The report is available at www.ACFE.com/team/ and for more information on Fraud Week see www.fraudweek.com.
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