Big business loses less to fraudsters in Switzerland

Economic crime affects 28 per cent of Swiss multinationals swissinfo.ch

Switzerland's big businesses are on average less affected by fraud than their European counterparts, according to a "European economic crime survey", published by PriceWaterhouseCoopers (PWC) in Zurich.

The investigation found that 28 per cent of Switzerland’s major businesses had suffered from white-collar crime over the past two years. More than four out of 10 European multinationals reported losses due to fraud.

John Wilkinson, a partner at PWC, told swissinfo, “the discrepancy between Swiss multinationals and their European counterparts is surprising, since they work in the same global marketplace.”

However, he pointed out that the data did not mean that big business in Switzerland is better protected than its European rivals. According Wilkinson, it is likely Swiss businesses are either less efficient at uncovering fraud or less willing to admit that it occurs.

The study was conducted between September and December of last year and covers 3,403 businesses, associations and non-governmental organisations in 15 European countries. In Switzerland, 208 organisations were interviewed for the survey.

The study discovered that across Europe big business is losing out to fraudsters, with over €3.6 billion (SFr5.4 billion) disappearing in the past two years.

A third of all companies believe that they are at greater risk to fraud today than they were five years ago.

In the UK and Germany, a staggering 70 per cent of major companies reported that they had been subject to economic crime in the previous two years.

Furthermore, nearly six out of 10 cases are discovered by “accident” and only just over half of the companies polled are insured against fraud.

More than any other type of fraud, companies and organisations are most concerned about cyber crime: 43 per cent of the organisations polled rate it as the number one fraud risk of the future.

Across Europe, of those companies that have been a victim of economic crime in the past two years, 13 per cent said computer fraud was to blame.

“The development of computer resources constitutes an extra danger,” said Pierre Brun, a risk management specialist at PWC. “Software companies must be pressured into creating more secure systems.”

The risk is illustrated by the “I love you” computer virus, which caused an estimated SFr4.7 billion in damage around the world.

Organisations are also more susceptible to internal fraud. Most crimes were committed by individuals within the company rather than from outside.

Embezzlement, or theft by an employee, has been the most prevalent type of corporate fraud in the past two years, accounting for 63 per cent of all incidents reported.

The amount of fraud uncovered by Swiss companies varies little between organisations with more or less than 5,000 employees. Smaller European companies tend to be more efficient in uncovering crime than their larger counterparts.

swissinfo with agencies