A recently published global survey titled “The 2022 Caseware State of Internal Audits Report” found that attempts to contain deceptive behaviour by businesses have failed significantly during the covid-19 pandemic.

The major shift to remote working due to the pandemic has prompted a rise in security and fraud risk. As a result, 89 percent of auditors admit to finding it difficult to prevent fraud, according to the new survey.

The report also outlined that organisations are responding by fast-tracking investment in prevention technology, with more than a third admitting to an inadequate fraud prevention and response plan.

“While the trend shows internal auditors have an important part to play in risk management and their influence is increasing in the area of fraud prevention strategy, many continue to operate without a fraud prevention and response plan. On a positive note, 31 per cent of respondents say their organisation is currently developing such a plan, with 64 per cent saying they already have one in place,” says Scott Epstein, chief product officer at CaseWare.

Out of all the respondents included in the survey, 46 percent said remote working has made it “somewhat more difficult” to prevent fraud while 43 percent said it is “more difficult”. 

Furthermore, over 70 percent said the pandemic has led to an increase in fraud threats with auditors especially concerned about a rise in theft of assets such as cash, inventory, services and intellectual property. 

Other respondents noted cited credit card abuse, falsifying expense reports, collusion with a third-party vendor or service provider, and falsifying or manipulating financial statements as emerging concerns.

When it comes to top challenges over the past two years, almost a third of the respondents involved in the survey believed that moving from manual processes towards more efficient workflows is a key challenge, while 27 percent pointed to challenges in adopting new audit technology. 

Other respondents outlined that adjusting to remote work, lack of training and skills, and deriving insights from large volumes of data as key concerns.

40 percent of internal auditors said they either don’t currently use or are unaware of whether their organisation uses analytics software to help mitigate fraud risks.

Scott Epstein believes that CaseWare’s survey has shown that changes are happening across most internal audit departments and are being accelerated by the pandemic and a need to change business processes and ways of working.

“Internal auditors are tasked to meet the challenges of increasing fraud risk and are pressured to do more, yet many still seem unprepared to manage the fraud risk for their organisation. At a time when online business and commerce has never been greater, they will need to move quickly to finalise and execute these plans to thwart the growth in online threats,” says Scott Epstein.

Scammers Are Posing as Insurance Companies and The Government to Steal Money From Flood Victims

In recent weeks thousands of Australians have tragically had their lives changed forever as a result of excessive flooding across the east coast of the country. To add further insult to injury scammers are trying to take advantage of flood victims posing as insurance companies, government bureaucrats and charities to con money from those who have been impacted.

Business Australia general manager products Phil Parisis outlined that scammers had their finger on the pulse when it came to targeting destabilising world events.

When a disaster such as the recent flooding occurs, scammers may send through emails posing as a government agency offering financial assistance, such as the $1000 disaster payments and get people to click on a link.

In these phishing attacks, when someone clicks on the link, usually this triggers the download and installation of a piece of software onto the device to give the scammer unlimited access.

From there, a fraudster can record while a person logs into their online banking on a computer or phone.

Phil Parisis outlines that this is the most common method that scammers follow to con their victims. Parisis says that he wouldn’t be surprised to see scammers pretending to be the State Emergency Service and other government organisations, as well as insurance companies and charitable organisations.

Mr. Parisis also contends that the barrier to entry for phishing scams was now very low, which was likely contributing to the increasing prevalence of scams. He said it was quite easy to buy software from the dark web to access someone’s computer.

It is also anticipated those scammers will also try their best to con their victims via call-based scams.

Most phone call-based scams usually involve asking the victims to take action, such as a common ploy where scammers pose as Amazon employees and ask people to hand over their credit card details to make an overdue payment for Amazon Prime.

The team at C&D Restructure and Taxation Advisory are here to help. As part of the Vault Group we can offer the full suite of financial products and advice to help you navigate the business landscape. Schedule a meeting here via Calendly or give us a call on 1300 1 VAULT (1300 182 858)

Post Author: Craig Dangar

Leave a Reply