(Source: Business Wire)The global financial services industry saw a dramatic spike in fraud activity with companies losing an average of $15.2 million over the past three years, according to the latest edition of the Kroll Annual Global Fraud Report, released today at the Association of Corporate Counsel's 2009 Annual Meeting in Boston. Despite sector-specific spikes and declines in fraud activity, the worldwide fraud rate remained steady in 2009. Companies lost an average $8.8 million to fraud over the past three years, an increase of seven percent over last year's figure which stood at $8.2 million. The findings are the result of a survey Kroll commissioned from the Economist Intelligence Unit of more than 700 senior executives worldwide.

Fraud levels varied markedly by sector with five industries experiencing a rise in fraud losses (financial services; professional services; healthcare, pharmaceuticals & biotechnology; retail, wholesale & distribution; and travel, leisure & transportation) and five sectors reporting declines (manufacturing; technology; media & telecoms; natural resources; and consumer goods & construction).

Blake Coppotelli, senior managing director in Kroll's Business Intelligence and Investigations unit said:

"Traditionally every downturn brings about a rise in fraud, but what we are seeing in 2009 is something far more complex. Companies are seeing greater vulnerability due to reduction in internal controls, pay cuts and reduced revenue across the board, but counteracting this increased risk are the realities of today's constrained business environment, where factors such as high staff turnover, entry into new markets and inter-firm collaboration are far less common than in years past. In short, the current economic crisis has increased the motive for fraud, but decreased the opportunity.

Of course, this shift in business behavior is only as lasting as the economic crisis itself, which is why companies must work to bolster their existing anti-fraud strategies in preparation for the economic changes to come."

Overall, 30 percent of companies reported the current economic climate had directly increased their exposure to fraud over the past 12 months, with only five percent reporting a decline.