Policing Fraud in the Private Sector: A Survey of the FTSE 100 Companies in the UK

Abstract

Fraud has increasingly become recognised as a problem in the private sector, with a growing number of estimates of the size of the problem produced by official government bodies and private professional services companies such as KPMG. There have, however, been fewer surveys of the strategies being used by the private sector to tackle fraud. This paper presents findings from a survey of the UK's FTSE 100 companies which produced 32 responses and the strategies they are using to counter fraud. It demonstrates a mixed picture of both good and bad practice, when benchmarked against well-recognised standards for tackling fraud, on issues such as having: a strategy; a designated person responsible for fraud; regular risk assessments; preventative measures; investigative resources and effective relationships with the police. It also calls for further research to be conducted on private sector counter fraud strategies.

Match-Fixing in Korean Football: Corruption in the K-League and the Importance of Maintaining Sporting Integrity

“…There are key elements to any counter fraud strategy, regardless of the focus of its business, and these are well documented, to name a few [4] [34]. The world of sport is no different to other business sectors, as it will experience some of the frauds mentioned earlier in this paper, but it will also suffer from frauds that are particular to it such as match-fixing.…”

“…It is however underpinned by a growing body of work [4] [9]. From this body of work, an effective counter fraud strategy has rapidly developed.…”

“…Those 'internal' employees who are familiar with the organization, its practices, and methods of operation that are seduced by outside influence, as the football players of Daejeon Citizen were, are open to fraud and corruption. As suggested elsewhere, the same vigilance should apply regarding fraud risk assessment regardless of the 'employees' contractual position; fraud risk assessment should be an ongoing exercise if the level of fraud is to be reduced [4].…”

“…For example, in some organisations, all new employees are made aware of the threat of fraud as part of employee induction. In other instances, employees attend fraud conferences, update knowledge and understanding of fraud online or commission specific fraud packages relevant to an organization's business [4] [9]. Furthermore, an organization can use its own intranet to disseminate information regarding fraud, hold fraud risk workshops to identify fraud risks and detail actions needed to counteract them, and produce specific whistle blowing procedures.…”

Private policing of financial crime

“…They also discuss punishment and innocent victims of private investigations. In a survey by Brooks et al, (2009), 17 out of 32 companies in the UK responded that they employ dedicated counter fraud staff, which in total accounted to 160 employees, while 13 had no specialist staff, and 2 did not answer the question. Button et al (2007aButton et al ( , 2007b and Tunley et al (2014) discuss the lack of competence among fraud examiners.…”