Statistics show that in the UK alone, an estimated 7% of annual turnover is lost to fraud schemes, involving issues such as kickbacks, insider trading, financial statement and invoice fraud, bribery, and even the simple skimming and misappropriation of assets. It is estimated that fraud costs business in the UK over £110bn per year.
Fraud, like any serious disease, spreads if not treated early. It saps corporate reputations and finances, and in the worst cases can prove fatal to an organisation. Reputational damage, in particular, can be devastating. A loss of confidence by shareholders, customers, suppliers and regulators, as well as the potential of litigation in the wake of a fraud, can lead to a drop in share price from which a company may never recover. In addition, if it can be shown that a company’s directors and management have neglected their fiduciary responsibilities, they can be held personally liable for the loss incurred by the company.
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