Procurement Fraud, Bribery, and Corruption Pose a Serious Challenge for Global Automotive Companies, finds PwC 2014 Global Economic Crime Study - Hawaii News Now - KGMB and KHNL

Procurement Fraud, Bribery, and Corruption Pose a Serious Challenge for Global Automotive Companies, finds PwC 2014 Global Economic Crime Study

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SOURCE PwC

Improving Internal Controls and Corporate Culture are Crucial Strategies for Global Businesses Working in High Risk Markets

DETROIT, Aug. 28, 2014 /PRNewswire/ -- Economic crime in the automotive industry is on the rise with 28 percent of the automotive respondents reporting that their companies experienced an incident of economic crime, up slightly from 25 percent in 2011. Among the top types of economic crime in the automotive sector, 74 percent are committed by internal perpetrators, making it the industry with the highest rate of insider crime. Most internal perpetrators were either senior executives (23%) or middle managers (54%).

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Top types of economic crime in the automotive sector include:

  • Asset misappropriation (74%)
  • Procurement fraud (34%)
  • Bribery and corruption (34%)
  • Human resources fraud (13%)
  • Cybercrime (13%)

"Economic crime results in significant revenue lost as well as impacting employee morale," said Ted Hawkins, partner, PwC US Forensic Services. "As the automotive industry continues to do business on a global basis, it becomes even more important to implement a fraud risk management strategy to fight against these types of crimes.  When automotive companies invest in emerging markets, these types of crime-fighting tools can help to uncover so called kick-back schemes and unethical vendor selection."

Survey results indicate that only about half (48%) of the automotive sector's companies have conducted a fraud risk assessment at least annually over the past 24 months-and 27 percent  haven't completed one at all.    

For more information about PwC's Global Economic Crime study, visit www.pwc.com/auto or download PwC's 365 app.

About PwC's Automotive Practice

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