The Association of Certified Fraud Examiners reported a median loss per fraud incident of $250,000 in their 2008 Report to the Nation on Occupational Fraud & Abuse (specific to the banking/financial services industry). The report also indicated that only 7% of internal fraud perpetrators had prior convictions.
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Human Resources
Internal Fraud Prevention for Financial Institutions
Insider or internal fraud perpetrated by employees is a pervasive and costly problem for the financial services industry. The U.S. Department of Labor reports that it costs one-third of new hires’ annual salaries to replace them. Add that to a median loss of $250,000 per internal fraud event, and the impact is critical.
Recognizing the rapidly growing problem of internal fraud in the financial services industry, the Internal Fraud Prevention service was created by Early Warning Services in 2006 and sponsored by BITS (the Technology and Business Strategy Group of The Financial Services Roundtable), to assist in performing new applicant screening.
For more information on how Early Warning can help prevent internal fraud, please see Internal Fraud Prevention service or contact us.
Source: Association of Certified Fraud Examiners 2008 Report to the Nation on Occupational Fraud & Abuse