Kroll Global Fraud Report finds 6 out of 10 travel businesses hit by fraud

WORLD – According to new figures from the 2013 Kroll Global Fraud Report, six out of 10 (63%) travel, leisure and transportation businesses were affected by fraud in the last 12 months.
 
Areas where companies in the sector were most frequently affected included the theft of physical assets or stock, affecting 23 per cent of them, and information theft, loss or attack, which affected 17 per cent of businesses in the industry in the past 12 months.
 
Notable weaknesses exist in the sector, which has the highest incidence of misappropriation of company funds (14%) and the second highest rate of regulatory or compliance breach (23%). The latter has been particularly common in the transport sector and has received significant attention from regulators worldwide.
 
The report indicates that cost reduction strategies are having a negative effect on fraud exposure. One in three businesses in the sector (35%) says that increased outsourcing has raised the risk of fraud, the second highest figure of any sector surveyed, and 29 per cent say the same about pay restraint, the highest of any sector. Exposure to fraud increased in 77 per cent of businesses in the sector over the past year.
 
“Fraud is on the rise again and while increasing regulatory pressure and compliance activity is probably driving increased fraud awareness and detection, undiscovered and unreported fraud is an infection with the potential to grow into a life-threatening corporate disease,” says Chairman of Kroll Advisory Solutions in Eurasia, Tommy Helsby. “Perpetrators of fraud are often thought of as faceless hackers in a distant land but our experience shows that to be the exception rather than the rule; the greatest vulnerability is to those who have already got past most of your defences by virtue of being an employee, partner or contractor.
 
“It is vital that as well as investing in technology, businesses mitigate the insider threat by focusing on areas like staff screening and due diligence on partners, clients and vendors.”
 
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