Fraud is continuing to increase this year, in part due to the COVID-19 pandemic, according to a new survey by the Association of Certified Fraud Examiners.
The report found that 79 percent of anti-fraud professionals have seen an increase in the overall level of fraud as of November, compared to 77 percent in August and 68 percent in May. Thirty-eight percent of the respondents said in November the increase has been significant, compared to 34 percent in August and 25 percent in May.
Alex Amezquita is CFO of Herbalife Nutrition, where he is responsible for corporate financial functions at the highest level, including the company’s financial reporting, accounting, tax and treasury functions. Prior to joining Herbalife Nutrition in 2017 as the senior vice president of finance, strategy and investor relations, Amezquita was senior vice president at Moelis and Company, a leading global investment bank, where he advised Fortune 500 companies on mergers and acquisitions, corporate governance, capital markets strategy and investor relations. Beginning in 2012, Amezquita worked extensively as a financial advisor to Herbalife Nutrition on key strategic and financial initiatives while at Moelis. Amezquita brings over 20 years of experience to Herbalife Nutrition from his finance and engineering background. He commenced his investment banking career on Wall Street advising Fortune 100 companies while at Merrill Lynch and Centerview Partners. He began his professional career in the aerospace & defense and technology sectors. During this time, Amezquita worked as both a lead design engineer and consultant to a broad spectrum of industry leaders ranging from Northrop Grumman to Cisco Systems. Amezquita holds an MBA in finance from the Wharton School at the University of Pennsylvania, and a Master and Bachelor of Science degree in electrical and computer engineering from Carnegie Mellon University.
Richard Herring is Jacob Safra Professor of International Banking and Professor of Finance at the University of Pennsylvania's Wharton School of Business
Chris Koverman, vice president engineering and operations at CLARA Analytics, is a seasoned engineering executive with more than 20 years of product development and senior management experience in strategy, design and development of complex, scalable cloud-based products. Koverman is known for his ability to define product strategy and lead the technical execution required to achieve these goals. Chris received a Bachelor of Science, Biophysics, from University of California, Berkeley and a Bachelor of Science, Computer Science, from the University of California, Santa Cruz.
Cyber fraud, payment fraud (such as schemes with debit and credit cards) and identity theft are the three top fraud schemes seeing increases, according to anti-fraud professionals.
The largest increase in observed fraud was in financial statement fraud, with 7 percent more anti-fraud professionals reported seeing financial statement fraud in November, compared to August. That could be because as companies continue to see their profits drop, they feel more pressure to cook the books.
The survey also found 77 percent of anti-fraud professionals report that investigating and preventing fraud is more challenging now, while 71 percent said detecting fraud is more challenging as a result of the pandemic.
ACFE members anticipate the fraud trend will continue, even as vaccines have begun rolling out this week in the U.S. Ninety percent of the survey respondents expect a further increase in the level of fraud over the next 12 months, with 44 percent predicting the change is likely to be significant.
Nearly half (48 percent) of the organizations polled expect to increase their investments in anti-fraud technology, and 38 percent intend to raise the use of fraud-related consultants or other external resources. Budgets for anti-fraud training and professional development are experiencing a similar increase (according to 37 percent of the organizations polled), but nearly one-quarter (24 percent) anticipate a decrease in this area. The budget component most likely to see decreases is travel for anti-fraud staff, which shouldn’t be surprising given the plunging levels of air travel in general over this past year, with 38 percent of the survey respondents expecting a reduction in funds for travel in the year ahead.
