Australian organisations are experiencing a significantly higher rate of economic crime than the rest of the globe, according to a recent PwC survey.
Australia a hotspot for economic crime, warns PwC
The study revealed 52 per cent of Australian organisations experienced economic crime in the last 24 months compared with the global average of 36 per cent.
According to the Australian edition of PwC's 2016 Global Economic Crime Survey, Australian organisations are also dealing with more individual incidents of economic crime, with 30 per cent experiencing more than 100 incidents compared to only nine per cent of global respondents experiencing the same volume.
Cyber crime is now the number one economic crime in Australia, followed by asset misappropriation and then procurement fraud.
Malcolm Shackell, a PwC partner and forensic services leader, said the types of economic crime most commonly experienced remains consistent with previous years, but, as a nation, we are dealing with an increasingly complex economic crime environment driven by cyber threats.
"I think it's fair to say we're a legitimate economic crime hotspot – it’s not a good picture. The high rate of economic crime exposed in part reflects our serious approach to reporting but, given we are lagging on early detection mechanisms, it reflects our reliance on doing what we have always done.
"To buck this trend we need to embed resilience. This means moving away from reliance on reactive detection methods to more sophisticated and proactive preventative and detective tools and techniques, like we are seeing globally."
Australian organisations also experienced more incidents of money laundering than their global peers over the last 24 months – 26 per cent, compared to 11 per cent globally and nine per cent for the rest of the Asia-Pacific region.
Despite a significant increase in money laundering reporting, Australian organisations have underinvested in anti-money laundering and counter-terrorism financing technology when compared to their global peers and lag behind on real-time monitoring of information relating to third-party providers. They also face two main challenges: securing funding and finding the right staff.
To reduce the risk of money laundering, organisations should regularly assess the nature of the risk and controls in place to deter money laundering. Particular scrutiny should be placed on relationships with third-party providers.
"Risk assessments should be conducted periodically and closely attuned to changed circumstances such as the operating environment, current global standards and practices and regulation in countries of operation," PwC cyber partner Richard Bergman said.
"They should also include profiling of your business partners into different money laundering and terrorist financing risk categories," he added.