Austin (April 8, 2002) -- Occupational fraud and abuse will cost U.S. businesses about $600 billion in revenue this year, according to the latest report by the Association of Certified Fraud Examiners.
CFEs participating in the study estimated that companies will lose 6 percent of revenue to occupational fraud in 2002, or about $600 billion. That's about $200 billion more than the losses estimated in the ACFE's 1996 report. While the expected rate of fraud remained the same as in the 1996 report, a rise in the gross domestic product rate from about $7 trillion to $10 trillion accounted for the increase, ACFE said in its 2002 Report to the Nation. And that's a conservative estimate, since not all fraud is detected or reported, ACFE warned.
Of the 620 cases examined, assets misappropriations (involving theft or misuse of assets) were the most common, accounting for about 86 percent of the cases cited, while fraudulent statements accounted for the largest losses, with a median cost of $4.25 million.
More than half of the cases cost victims at least $100,000, while nearly one in six cases caused losses of $1 million or more, ACFE reported. The full 2002 Report to the Nation can be viewed online at http://www.cfenet.com/media/2002RttN/.
-- Electronic Accountant Newswire staff
