{"id":10191,"date":"2019-11-05T15:22:00","date_gmt":"2019-11-05T20:22:00","guid":{"rendered":"https:\/\/www.sage.com\/en-us\/blog\/?p=10191"},"modified":"2024-02-15T11:36:43","modified_gmt":"2024-02-15T16:36:43","slug":"in-the-fight-against-fraud-how-the-cfo-leads-the-charge","status":"publish","type":"post","link":"https:\/\/www.sage.com\/en-us\/blog\/in-the-fight-against-fraud-how-the-cfo-leads-the-charge\/","title":{"rendered":"In the fight against fraud, how the CFO leads the charge"},"content":{"rendered":"
\n\t
\n\t\t
\n\t\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t\t\t\t\t\t\t\t
\n\t\t\t\t\t\t\tStrategy, Legal & Operations<\/a>\t\t\t\t\t\t<\/div>\n\t\t\t\t\n\t\t\t\t
\n\t\t\t\t\t

\n\t\t\t\t\t\tIn the fight against fraud, how the CFO leads the charge\t\t\t\t\t<\/h1>\n\t\t\t\t<\/div>\n\n\t\t\t\t\t\t\t\t\t

\n\t\t\t\t\t\t\t\t\t\t\t<\/p>\n\t\t\t\t\n\t\t\t\t\n\t\t\t\t\n\t\t\t<\/div>\n\n\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n\t\t

\n\t\t
\n\t\t\tPublished
\n\t
\n\t\t
\n\t\t\t\t\t\t\t
\n\t\t\t\t\t\n\t\t
\n\t\t\t\n\t\t\t\t\"\"\t\t\t\tLaurent Charpentier<\/span>\n\t\t\t<\/a>\n\n\t\t\t\t\t<\/div>\n\n\t\t\t\t\t\t<\/div>\n\t\t\t\t\t<\/div>\n\t<\/div>\n<\/div>\n\n\n\n

Security, which involves preventing and fighting fraud, is a topic that continues to be more and more critical in today\u2019s world of ongoing digital transformation. The Association of Certified Fraud Examiners reports that U.S. businesses will lose an average of five percent of their gross revenues to fraud<\/strong>.<\/p>\n\n\n\n

Responsible for the company\u2019s financial health, the CFO is explicitly involved with any losses caused by fraud. And if he\/she is going to be effective in leading the fight against fraud, they will need to adapt their defenses to face fraud and fraudsters who are better organized, more aggressive, and more technologically proficient than ever.<\/p>\n\n\n\n

This leads us to three questions that CFOs should be asking and answering to most effectively lead the fight against fraud.<\/p>\n\n\n\n

Threats come in a variety of forms. We are familiar with the most common: Supplier fraud (fake bank details), fraud on finance (stock brokers and bankers) and legal professionals, and client fraud (fake invoices). And the reality is that the human factor is still the main source of vulnerability in terms of exposure to fraud today.<\/p>\n\n\n\n

An employee is typically involved in most confirmed cases of fraud. Sadly, in the U.S., fraudsters who have longer tenure with their company (five years or more) stole twice as much! An average of $200,000 compared to employees with tenure of less than five years. And 68 percent of the fraud committed by individuals<\/a> outside the company is actually the act of people close to the company in some manner, notably partners such as sales agents, clients, service providers, and others.<\/p>\n\n\n\n

The risks to the company are obvious:<\/strong><\/h2>\n\n\n\n

Financial<\/strong>: Financial impact is not only felt when cash is directly impacted, such as invoices paid or wire transfer made to a fraudulent recipient, but also in terms of operating income, such as bad receivables resulting in loss of cash flow and lower net profit.<\/p>\n\n\n\n

Data Theft:  <\/strong>One of the greatest riches of a commercial company are its client data files. This threat can take two forms:<\/p>\n\n\n\n