Occupational Fraud Statistics

Best practice internal controls can help prevent employee misconduct - including embezzlement. 

According to the U.S. Chamber of Commerce, the incidence of employee theft is 15 times greater than external theft. The Association of Certified Fraud Examiners comprehensive study on occupational fraud shows that 22% of employee frauds are for at least $1M, local governments included. Active occupational fraud prevention and detection efforts significantly help reduce that number – and could possibly prevent it.  About 1/3 of all small business bankruptcies are as a result of employee embezzlement. 

What the data show are that no organization is immune, occupational fraud happens frequently by trusted and experienced employees, and that taking proactive efforts to prevent and detect occupational fraud makes a real difference!

Data below come from the 2018 Association of Certified Fraud Examiners Report to the Nations – Study on Occupational Fraud and Abuse. The report analyzes 2,690 known cases investigated by Certified Fraud Examiners between January 2016 through October 2017.

• Because the number of actual incidents is unknown, and likely much higher than reported, the cost of occupational fraud is staggering. The known cost from just the cases reported here, is over $7.1B in loss.

• 22% of the time occupational fraud costs the victim organization $1M or more.

• Asset misappropriation represents 89% of all occupational fraud – followed by corruption and then financial statement fraud.

• Active detection methods are significantly more likely to reduce the duration and loss of an occupational fraud.

• Private companies represent 42% of known cases, public companies 29%, and governments 16%.

• Organizations with fewer than 100 employees represent 28% of known cases, 100-999 employees 22%, 1,000-9,999 employees 26%, and 10,000 or more employees, 24% (split evenly – size of the organization does not matter).

• Active anti-fraud controls, including regular data analytics, reduce the cost and duration of the embezzlement by an average of 50+%.

• 47% of known cases involved an employee with at least six (6) years with the organization.

• Most cases were committed by employees 36-50 years old.

• Employees over age of 56 represented the highest median loss to the organization.

• About half of the fraudsters are college educated with the highest dollar loss occurring from employees with postgraduate degrees.

• 89% of the time the employee had no prior criminal incidents on record.

• 85% of the time the employee had never received discipline from their organization.

Click to learn more about:

Occupational fraud risk assessments

Occupational fraud data analytics

Employee awareness education