- Customer fraud is a bigger problem in Australia than the rest of the world.
- In a survey, 45% of Australian organisations reported experiencing it in the last two years compared to the global average of 29%.
- The study by PwC found that 60% of economic crime in Australia is committed by a ‘frenemy’ –an organisation’s employees, customers or suppliers.
Australian companies are more likely to be ripped off by those closest to them.
Customer fraud is the number one economic crime in Australia with companies reporting a significantly higher rate than the rest of the world in the past two years, according to a PwC survey released today.
In Australia, 45% of organisations reported customer fraud compared to the global average of 29%. One in three Australian companies lost more than $1 million.
The Australian edition of PwC’s Global Economic Crime Survey reveals threats from outside (64%) such as fraudulent customers, hackers and organised crime also outweigh internal threats (34%) for the first time in the 27 years the survey has been running.
Almost two-thirds (64%) of all fraud and economic crime came from external sources compared to less than half just four years ago.
However, 60% of these crimes were committed by frenemies — someone close to the organisation, such as a customer, supplier, consultant or agent.
And they are getting more sophisticated in their scams.
“The significant rise in customer fraud is being driven by the increasing availability of information and new technologies like editing apps to change documentation, make fraudulent IDs, credit card applications and insurance claims,” says PwC Partner and Forensic Services Leader, Malcolm Shackell, said:
“Another driver is the increasing influence and sophistication of organised crime syndicates.
“Fraudsters are more strategic in their goals, and more sophisticated in their methods. It’s a business in its own right that’s tech-enabled, innovative, opportunistic and pervasive — like the biggest competitor you didn’t know you had.”
Australia is still a hotspot for cybercrime.
Cybercrime is one of the most prevalent forms of economic crime experienced by Australian companies, with almost half of those surveyed saying they have suffered an attack in the last two years.
Phishing was the most common type of cyber attack, followed by malware.
Australia is among 18 countries out of 123 which reported cybercrime to be more disruptive than the global average (15%). Survey respondents in Australia and across the globe expect cybercrime to be the most disruptive economic crime in the next two years.
PwC’s Global Economic Crime Survey draws on data from more than 7,200 respondents, including 158 from Australia.