Employee theft was a prominent – and expensive – problem in 2011, but there are some noteworthy trends that can help you prevent similar loss within your organization.

Marquet International Ltd. has studied white-collar crime in the United States for the past four years, and its most recent report – The 2011 Marquet Report on Embezzlement – indicates that fraud remained a significant issue in 2011. The company examined 473 cases of white-collar fraud with more than $100,000 in reported losses, and its findings include:

  • There was a slight 2% decrease in the number of cases from 2010.
  • Non-profits, including religious organizations, experienced one-sixth of all major embezzlement cases.
  • The average loss was nearly $750,000.
  • Employees who held finance/bookkeeping and accounting positions committed about three-quarters of the incidents in 2011 and two-thirds of all cases from 2008-2011.
  • The most common scheme involved issuing forged and unauthorized company checks. The second-most common scheme involved the theft and/or conversion of cash receipts.
  • Nearly two-thirds of the cases involved female perpetrators. However, on average, male perpetrators embezzled nearly 25% more than females.
  • Nearly 90% of the cases involved individual perpetrators, and most major embezzlers appear to have been motivated by a desire to live a relatively more lavish lifestyle, rather than driven by financial woes.

A majority of the organizations involved in these schemes had weak business and cash controls.  In economic uncertainty, preventing fraud with strong internal controls is cheaper and more effective than detecting a crime.

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