All-time high levels of fraud and cyber issues plague industries today – report

Victor Barreiro Jr.
All-time high levels of fraud and cyber issues plague industries today – report
The 10th annual Kroll Global Fraud Risk Report outlines the risks industries and organizations now have to face

MANILA, Philippines – A survey of executives found increasing levels of fraud, security, and cyber-related issues severely affecting industries and organizations in 2017.

Released earlier this year, the 10th annual Kroll Global Fraud Risk Report outlines the risks industries and organizations now have to face. The online worldwide survey gathered information from 540 senior executives who hold positions in multiple industries and geographies, and was fielded through June and August 2017.

According to the report, 84% of surveyed executives reported their company became the victim of fraudulent activity within the past 12 months, This is up from 82% in 2016 and is part of a continuing rise in fraudulent activity.

In terms of cybersecurity, 86% executives have also reported a cyber incident occurring within the past 12 months, up from 85% in 2016. However, it must also be noted some countries and industries have nearly all its executives reporting cyber-related incidents for 2017.

Meanwhile, security incidents are also on the rise, with 70% of respondents reporting at least one security incident in the company during the last year, up from 68% from 2016.

NEGATIVE EFFECTS. Graphs point to how badly affected respondents are in different ways to various types of incidents. Graph adapted from Kroll Global Fraud Risk Report

Effects

The Kroll report also highlighted the notable repercussions of the increase in activity for fraud, cybersecurity, and security issues.

These repercussions affected employees, customers, and the organizations and businesses themselves in terms of reputation and business continuity or revenue. Also affected were the relationships organizations held with regulating bodies.

The most extensive repercussions were for employees, whose feelings of privacy, safety and morale were negatively affected. This was according to 82% of surveyed executives whose company suffered a fraud incident, 81% of those who experienced a cyber incident, and 80% of those who went through a security incident.

TYPES OF FRAUD. Image lists the types of fraud suffered by respondents in 2017 and compared to 2016 results. Image adapted from Kroll Global Fraud Risk Report

Threats to confidential information

Companies and organizations have confidential information, from personal data to trade secrets, and it’s the value in that data that criminals see interest in. Instead of stealing physical assets, criminals can now just pry the secrets away and sell that instead.

The Kroll report said information theft, loss, or attack became the most prevalent type of fraud experienced in the past year. It was cited by 29% of respondents, up from 24% in 2016’s survey.

That said, the theft of physical assets or stock and corruption and bribery issues were also noted as major fraud issues.

CYBER INCIDENTS. Image shows types of cyber incidents suffered by respondents in 2017 and compares them to 2016 data. Image adapted from Kroll Global Fraud Risk Report

Cyber and security incidents

In terms of cyber incidents, respondents said there were more cyber-related incidents in 2017. As 2017 was the year of Wannacry ransomware and Petya malware spreading globally, this was a year in which viruses and worm infestations increased.

The report said 36% of surveyed executives reported being hit by a virus or worm attack, up 3% from 2016. This was the most reported cyber incident named in this year’s report.

Incidences of email-based phishing, data breaches, and ransomware attacks also increased. Meanwhile, data deletion, whether by malware, malicious act, or corrupted data, was also seen as increasing.

As for security incidents, the most prevalent sort of incident happened to be physical theft or the loss of intellectual property, which ranged from counterfeit goods and trademark violations, to the theft of proprietary information.

The complete Kroll report, which includes additional breakdowns by specific countries and by industry type, is available online at this page. – Rappler.com

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Victor Barreiro Jr.

Victor Barreiro Jr is part of Rappler's Central Desk. An avid patron of role-playing games and science fiction and fantasy shows, he also yearns to do good in the world, and hopes his work with Rappler helps to increase the good that's out there.