Certified Fraud Examiner Practice

The most common category of occupational fraud, as reported in the 2016 Report to the Nations, is asset misappropriation. This type of fraud involves the theft or misuse of an organization’s assets, which can include cash, inventory, or other resources.

Asset misappropriation accounts for a significant proportion of fraud cases because it often involves employees stealing small amounts of money or resources over time, which can go unnoticed for an extended period. The accessibility of assets and the opportunity for individuals with access to manipulate or divert resources make this type of fraud prevalent.

In contrast, other forms of occupational fraud, such as financial statement fraud and corruption, tend to be less frequent but can be more damaging in terms of financial loss and reputational harm. Asset misappropriation's direct and straightforward nature contributes to its higher occurrence in organizations across various industries. Thus, it is essential for organizations to implement robust controls and monitoring systems to minimize the risk of such fraud occurring.