UK companies facing significant increase in fraud risk
- Published: Tuesday, 02 February 2016 09:22
Cyber breaches and insider threats, which include malicious employees stealing, manipulating or destroying data, are the fastest-growing risks for UK companies according to EY’s 2016 Global Forensic Data Analytics Survey.
The survey report ‘Shifting into high gear: mitigating risks and demonstrating returns’ contains the results of a survey conducted with 665 executives globally across nine industry sectors, including financial services, life sciences, manufacturing and power and utilities.
In the UK, 83 percent of respondents - the highest percentage globally - felt that cyber breaches and insider threats posed the fastest growing fraud risk. 65 percent said that internal fraud, such as submitting false travel expenses and entertainment abuse posed the second highest risk – also significantly higher than other countries surveyed. 68 percent of UK businesses also said that they needed to do more to improve their current anti-fraud procedures.
Paul Walker, EY’s UK Head of Forensic Technology & Discovery Services, comments: “UK companies are facing both old and new challenges in fraud prevention. It is interesting to see that the more ‘low tech’ forms of fraud, such as submitting false receipts, still pose a big concern for many companies as well as the evolving threat of cybercrime, which is now an everyday reality and a relentless challenge in order to stay ahead of the hackers.
“We are therefore seeing more boards and senior management looking towards advanced technology such as forensic data analytics (FDA) as a critical component of their risk management and compliance programmes. This is especially critical given the current regulatory enforcement environment and market reaction to instances of alleged corporate fraud, bribery and cyber breaches.”
Globally, three out of five respondents said that they plan to spend more on FDA in the next two years. When looking at the reasons for increased investment, the survey found that responding to growing cybercrime risks and increased regulatory scrutiny are the top drivers at 53 percent and 43 percent, respectively. How FDA tools are deployed is also changing, with 63 percent of respondents saying they invest at least half of their FDA budget on proactive monitoring activities.