Two thirds of FS businesses were affected by fraud in the last 12 months. According to figures from the Kroll Advisory Solutions Global Fraud Report released this week, the sector has the highest level of internal financial fraud (25 per cent) and regulatory or compliance breach (16 per cent) of any industry, and the second highest rate of IP theft (10 per cent).

Information theft, however, remains the biggest problem, affecting 30 per cent of FS firms in the last year, the second highest prevalence of any sector. Companies in this sector were the most likely to report that outside hackers were involved in the attacks on information (32 per cent). Insiders are also a big problem, with 32 per cent of companies affected reporting that employee malfeasance had been a factor in the attack.

Increasing IT complexity is cited as the leading driver of increased exposure to fraud, named by 31 per cent of those whose exposure has grown. Despite this, only 54 per cent of FS firms plan to invest in further IT security. Fifty eight per cent said their exposure to fraud has increased in the past year.

Tommy Helsby, chairman, Kroll Advisory Solutions, Eurasia, says: “One look at the global headlines in the past year, from LIBOR-fixing in London to accounting fraud in Tokyo, will tell you that fraud continues to be a pervasive issue, and for each story that enters the public consciousness there are many more that don’t. Increasingly, fraud exhibits industry-specific and regional characteristics, which require detailed knowledge of a market, sector, business process or culture to unearth, redress and prevent. Companies that get complacent about it do so at their own peril.”

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