March 17, 2009

Canadian corporate fraudsters profiled

The auditing and advisory KPMG group in Canada has profiled corporate fraudsters, saying Tuesday three-quarters of them are men employed less than five years.

In a survey of senior executives from an undisclosed number of companies whose revenues ranged from less than $100 million to more than $1 billion, KPMG found 69 percent of fraud instigators were between the ages of 30 and 49.

The profile suggested 69 percent of fraud cases were internal jobs, 20 percent external, and 11 percent involved both insiders and outsiders.

The three leading factors found in identified fraud were 28 percent were committed for personal need, simple opportunity 19 percent and greed by 14 percent, the release from Toronto said.

Interestingly, bad habits (such as alcohol, drug abuse, gambling) were a factor in only 11 percent of reported cases, the report said.

In light of the global economic crisis, James Hunter, national leader of KPMG's forensic practice, said companies needed to be more vigilant.

Now more than ever, corporate Canada cannot afford to wait for a Ponzi (pyramid) scheme or more tales of corporate greed to occur before they take the problem seriously, he said. Shareholders are demanding more accountability in these times.