KPMG study: gambling major driver of fraud

Gambling is the major driver of fraud in Australasia says the latest KPMG study.

The total value of fraud reported was $301.1 million and "gambling was the most common motivator", says KPMG's eighth biennial Fraud Survey.

Questionnaires were sent in August last year to a representative sample of New Zealand and Australia's largest organisations across the public and private sectors seeking information about incidents of fraud in the period February 2006 to January 2008.

Usable responses were received from 420 organisations, with 222, 577 separate incidents of fraud reported. This amounted to a "significant increase" from the previous survey in 2006.

"The trend is clear: Fraud continues to be a big problem for Australian and New Zealand organisations," says the report. "The worrying signs are that gambling continues to be a strong motivator for fraud, and that fraud recoveries at 11 percent have decreased substantially from the 37 percent experienced in 2006."

Forty-four percent of the reported fraud was attributed to gambling - a twofold increase on the 2006 survey - followed by 'greed and lifestyle' at 37 percent. Gambling as a motive resulted in an average value per incident of $1,101,808 compared to $299, 729 in 2006.

Fifteen percent of the largest incidents involved some form of identity fraud. Non-management employees were most likely to offend. The most common form of identity fraud involved unauthorised use of credit cards or card numbers. Respondents reported 154,602 cases of this kind with a total value of more than $90 million.

'It has been our belief that gambling and crime have a significant link and this is further clear evidence that this is a trend which is growing. Referrals from Corrections to Problem Gambling Foundation have nearly doubled in the last year, further re-inforcing this link,'says David Coom, Communications Director, Problem Gambling Foundation of New Zealand.