Fraud is everywhere, and you do not need to be an investigator or analyst to detect and report it. In fact, the best people to sniff out suspicions are those in the thick of it.
The Association of Certified Fraud Examiners (ACFE) is the world’s largest anti-fraud organization with about 91,000 members operating out of about 90 different countries; its mission is to reduce the incidence of fraud and white-collar crime, and to assist the membership in fraud detection and deterrence. This mission is achieved through various programs and resources to educate and train individuals on how to identify, prevent and combat fraud.
Chief Strategy Officer of the ACFE, John Warren, said these prevention efforts are largely dependent upon the individuals who identify and report potential incidents–also referred to as whistleblowers.
“Whistleblowers are a critical component of fraud detection,” said Warren.
Every two years, the ACFE conducts a study to the nations about the latest effects of fraud on business and governmental organizations. An important finding of the most recent report demonstrates that one of the most effective ways to catch fraud is through a tip by a whistleblower; 42% of all frauds are caught by someone blowing the whistle.
“A whistleblower can be anybody in an organization, but is someone who has suspicions of wrongdoing,” said Warren.
With an estimated 4 trillion dollars a year collectively lost due to fraud, there is a lot at stake. Warren recognized that oftentimes, there is a lot at stake for those contemplating blowing the whistle, too.
When struggling with hesitancy to report suspected fraud or unethical behavior due to the fear of being wrong, causing harm to others or even being retaliated against, Warren recommends to think of the act as a step towards helping other employees.
“When that [money] is lost to fraud, that’s just money going into the pockets of criminals,” Warren said. This money could be reinvested into the organization by hiring more people, creating new jobs, increasing social benefits and building infrastructure; instead of focusing on what could go wrong, think of what could go right if the tip is made.
“A small fraud turns into a bigger fraud, turns into a massive fraud; it grows and grows and grows,” said Warren. “We need to nip this in the bud and we need to reinforce within our organizations that we do not tolerate illegal and unethical conduct.”
Warren also said that fraud crimes tend to last anywhere between one to two years before being identified, even though there may be unreported suspicions before then.
This is why, to the ACFE, providing Certified Fraud Examiner (CFE) training through a rigorous, four-part exam to test one’s knowledge and capacity of fraud incidents is not enough; compiling resources for everyone from employees to employers to be aware of potential criminal behavior and create change is integral. Resources include materials on how to set-up a fraud policy within one’s organization or department, completing prevention check-ups, protection for whistleblowers, a complete taxonomy that outlines common frauds in different industries and even videos of convicted fraudsters explaining the motives behind their crimes.
Recognizing whistleblowers for their courage and morality is a cause close to the heart of the ACFE’s mission, and what created the Cliff Robinson Sentinel Award. This award acknowledges and thanks those who take the brave step to come forward, and “for choosing truth over self,” Warren said.
The Whistleblower Summit and Film Festival is sponsored by former winners of the Sentinel Award, and is the ACFE’s first whistleblower-related sponsor of the association’s International Fraud Awareness Week, from Nov. 13-19.
Originating in 2000, when this week was first established the conversations about fraud were far from frequent. Now, there are over 1,200 organizations in nations all over the world participating in the conversation.
Warren said that he had the opportunity to join an event in Slovenia, virtually, and was excited to hear that even in a country he knows little about, they were discussing the cause. One topic from this event was whistleblowers and how they help organizations do better.
By visiting the awareness week’s official website, individuals can find a full list of events that are taking place worldwide to discuss and mediate the threat of fraud.
One of which includes the encore of this year’s Whistleblower Summit and Film Festival, accessible online for a day or week-long viewing pass.
Whistleblower Summit & Film Festival stands strong in educating about and battling against fraud. Adding to the event will be an Encore Presentation of this year’s WSFF film lineup.
John Warren, Chief Strategy Officer of the Association of Certified Fraud Examiners, discusses the importance of International Fraud Awareness Week and explains how bystanders can get involved in the discussion.