HALF OF Irish companies have experienced an instance of serious fraud in the past two years, according to the latest Ernst and Young global fraud survey published yesterday.
The high instance of fraud experienced by the Irish companies is three times that reported by global corporations, which stands at 16 per cent.
Twenty-one per cent of firms in western Europe said they had been hit.
In addition, 85 per cent of Irish respondents felt their board members were increasingly concerned about personal liability in terms of fraud, bribery and corruption.
The survey revealed 70 per cent of Irish businesses have been asked by their board to provide details of any internal investigations into fraud, bribery or corrupt practices in the past year compared to just 28 per cent globally.
Fraud investigations partner with Ernst Young Julie Fenton said the figures were unsurprising as the recession meant the climate was ripe for fraud.
“There has been increased pressure on businesses and board members to maintain financial results in difficult conditions which has encouraged new frauds, while companies have been forced to take a closer inspection of costs, leading to the uncovering of pre-existing fraud schemes.”
However, the survey indicates that Irish companies are better prepared to manage fraud in key areas than their global counterparts.
Seventy per cent have a clear process for reporting incidents to their board, while half of Irish respondents have a documented response plan.
It also found though that 40 per cent of Irish businesses have never formally assessed their fraud risk, compared to the global average of 14 per cent.
Just 30 per cent of Irish respondents have a clear process for determining consistent disciplinary policy around fraud.
“The fact that so many businesses in Ireland have no formal policy towards handling fraud risk is truly alarming considering Ireland is experiencing greater incidence of fraud attacks than many other countries,” Ms Fenton said.
The responses were gathered from 1,409 companies globally between November 2009 and February 2010.
