The pressure to achieve targets and cost-cutting are regarded as the main reasons that push employees of companies to commit fraud. ‘Star’ performers in an organisation are more likely to engage in such malpractice. These observations were made by Saket Bhartia, Director (Fraud Investigation and Dispute Services)- EY (Ernst & Young), as he explained the profile of a fraudster.
He was speaking at a seminar on ‘Fraud and Corruption Risks to Corporates’ organised by the Bangalore Management Association (BMA) here on Thursday.
He said star performers used their trust and reliability to perpetrate fraud. He explained that the typical fraudster was an internal employee who was around 30 years of age and had been with a company for a long time. Moreover, fraudsters were likely to be associated with the procurement and sales division of a corporation.
Common instances of fraud involved procurement, payroll, logistics and IT roles.
“We have investigated and solved more cases associated with data integrity in the past six months than any other point of time,” he added.
Bhatia explained that employers too indulged in malpractice. “While the number of fraud cases is maximum in the lower management level, the monetary impact is maximum when fraud is committed by top-level executives,” he emphasised.
“Top-notch companies lose nearly six per cent of their revenue due to fraud and this can harm their brand image as well,” he added.