After more than 2000 interviews, Ernst and Young's fraud survey results suggest there are some serious challenges ahead.

In 2006, Ernst & Young made its first survey of European organisations to find out employees’ perceptions towards fraud risks and how management and board members were responding to these challenges. Since then, the size and scope of our survey have increased significantly.

The 2011 European Fraud Survey reflects the views of more than 2,300 respondents — from the factory floor to the C-suite — in 25 countries. It contrasts the views found in the mature markets of Europe with those found in the developing markets on matters including:

• Employee perceptions of fraud
• Bribery and corruption
• Companies’ responses to the challenges posed by fraud risks
• The response of regulators and law enforcement.

Companies must be prepared for the challenges posed by greater regulatory scrutiny. However, the E&Y survey suggests that a large proportion remains tolerant of unethical conduct across all levels of organisations:

• Almost one in five company employees, regardless of grade, consider it acceptable to pay bribes to win or retain business.

This is not new. This finding is similar to the results from the firm’s survey in 2009. It does, however, indicate that companies are not making progress in strengthening their ethical culture.

Fraud sculpture designed by children to be uncovered in London in an attempt to draw attention to mass marketing fraud.

A giant sculpture made from thousands of “scam” letters will be unveiled on London’s Southbank on Monday 13 June. It’s part of an effort to highlight the UK-wide blight of mass marketing fraud.

The artwork, made from a haul of intercepted mail, was created by primary school children as part of a week-long Mass Marketing Fraud Awareness campaign. The campaign is by the anti-fraud campaign “Think Jessica”, the Police, SOCA, Trading Standards and the National Fraud Authority.

Sent by professional fraudsters, scam letters are designed to con recipients into investing in bogus schemes such as fake lotteries, share frauds and inheritance scams. They depend on persuading victims to hand over money based on promises of valuable goods, services, or benefits that are never delivered.
After replying to a ‘tempter’ letter, victims’ names can be put on a ‘suckers list’ which is then sold to other fraudsters. Chronic victims include some of the most vulnerable people in society, some of whom end up being hounded with terrible consequences.

As technology in mobile devices increases, so does fraud. Are we focusing enough on protecting our devices from hackers?

We expect exponential growth in the number of incidents related to mobile devices in the next few years. From theft or compromise of information in these devices, through massive infection campaigns, and up to frequent exploit of the vulnerabilities introduced into the server side.

Organisations need to start planning to secure the devices and their interaction with the enterprise networks. Tools and procedures need to be put into place, such as anti-malware, encryption, and authentication. Special monitoring requirements should be set for access of these devices to enterprise resources (databases, files, Intranets). On the other hand, application providers need to get their act together with respect to serving these devices, including vulnerability mitigation, reevaluation of trust, and incorporation of new authentication/authorization channels.

Smart phones and tablet computers now contain some of our most important documents, securing these documents must become a high priority to avoid a potential disaster for the industry.

Andy Cordial, managing director of secure storage systems company Origin Storage, writes of why mobile computing users need to raise their security game if we are to avoid a series of smart phone and tablet computer driven data breaches hitting the headlines.

While the range and variety of IT security defences for portable computers – that’s netbooks and laptops to most people – is excellent, and able to cater for all budgets and types of user, it should be apparent to any security observer that the same cannot be said for smartphones and tablet computers.

With 45 million iPads already having been sold, and with the prospect of Android tablets and BlackBerry tablets also selling in their millions, it’s clear that IT security professionals working within companies of all sizes have a security problem on their hands.

And this is before we even begin to talk about securing the rising numbers of smartphones in the business workplace.

With most business users toting one or more mobile devices with a variety of email, documents and contact details in their memories, it should be clear that smartphones and tablet computers should be afforded the same levels of security and protection as the laptops and netbooks in circulation.

FBI go digital with electronic reading room.

The Vault is the FBI’s new electronic reading room, containing more than 3,000 documents that have been scanned from paper into digital copies

You can browse or search for specific topics or persons (like Al Capone or Marilyn Monroe) by viewing the alphabetical listing, by using the search tool. For instance two short files include a 1981 investigation into threats received by the Prince and Princess of Wales and security issues concerning Diana’s 1989 visit to the United States

Much of the history of the 20th century can be found in the files, from Adolf Hitler and Hollywood actress Liz Taylor (due to extortion attempts against her) and Elvis Presley and Frank Sinatra (the target of many extortion attempts investigated by the FBI) to the Ku Klux Klan and other extremist groups inside the United States and violent and organised crime and suspected subversion.

For example in 1963, a rock group named the Kingsmen recorded the song “Louie, Louie.” The popularity of the song and difficulty in discerning the lyrics led some people to suspect the song was obscene. The FBI was asked to investigate whether or not those involved with the song violated laws against the interstate transportation of obscene material. The limited investigation lasted from February to May 1964 and discovered no evidence of obscenity.

New legislation reveals businesses must take steps to prevent bribary of any nature relating to thier organisation.

The Bribery Act comes into force on 1 July having received Royal Assent in April 2010. Its aim is to replace antiquated law on this subject and to ensure that the UK comes into line with the majority of other countries’ anti-bribery legislation. The accountancy firm Chantrey Vellacott DFK writes.

The provisions of the Act will affect all commercial businesses. It not only reiterates the illegality of paying and receiving bribes, but also requires businesses to take steps to prevent its occurrence in connection with their businesses anywhere in the world.

There are four criminal offences under the act:

a. Paying bribes (s.1)
b. Receiving bribes (s.2)
c. Bribery of a foreign public official (s.6)
d. Failure of a commercial organisation to prevent bribery (s.7)

A corporate body found guilty of one of the above offences may face an unlimited fine. An individual found guilty may face imprisonment for up to ten years, an unlimited fine, or both.

Meanwhile, from audit firm Deloittes, comments:

Nic Carrington, partner in Deloitte’s Forensic & Dispute Services team:

“One of the most significant issues facing companies in their implementation of an effective anti-bribery programme will be to ensure that their management and staff in overseas operations properly understand that local custom and practice will be no defence under the new UK law and that consequently their actions may give rise to significant corporate and individual liabilities back in the UK.

Unless properly trained and followed through, it may be easy for management and staff to dismiss new policy documents as not relevant to their local operations and what they perceive as the realities of conducting business on the ground. A meaningful anti-bribery risk assessment must therefore fully engage with overseas operations to identify all the risk areas that are faced and an effective training programme will be critical.”

Kirsty Searles, partner in Deloitte’s Anti Bribery and Corruption Controls team:

“Larger corporates with in-house legal and compliance teams have made good progress on implementing structured programmes to achieve Bribery Act compliance. However, our experience suggests that mid cap (FTSE 250) and smaller sized entities are not making such rapid progress, which may be expected given the typical lack of such capabilities in-house. There will be a comparatively greater burden on these companies to get up to speed on compliance. It is likely that many of these businesses will not have established “Adequate Procedures” by 1 July 2011, and, therefore, will be looking at a period of time without a defence if prosecuted for the corporate offence under the Bribery Act.

“For those taking their first steps, the key will be to undertake a risk assessment to understand where exposures lie in the organisation, and then implement appropriate policies and processes to ensure compliance. These measures should be proportionate to the size of the organisation and the specific risk exposures in line with the Bribery Act’s guidelines. Senior management need to clearly communicate the organisation’s lack of tolerance for bribery and corruption, and the requirement that all staff must be aware of, and comply with, anti-bribery and corruption policies and procedures.”

Brent McDaniel, UK head of Anti-bribery & Corruption at audit firm KPMG, warned: “Despite the crescendoing noise and continued speculation around the Bribery Act, a third of all UK companies remain unprepared for today’s implementation, risking a jail sentence or unlimited fine. In fact 71 percent believe there are some places in the World where business cannot be done without engaging in bribery and corruption.

“While many corporates are already tackling the Act head on, the fear is whether training and policy are extending to global partnerships and overseas third parties.

“For those enjoying corporate hospitality this week, proportionality sits at the heart of this legislation. The SFO are likely to have little interest in prosecuting over a bottle of wine or a day at the races. The mandate is to stamp out grand scale corruption in high risk countries, but evidence of companies undertaking thorough risk assessments and training is vital to evade prosecution.

“In a crowded regulatory world the Bribery Act is but one element and should not be tackled in isolation, but must be the catalyst for company boards to overhaul the entire compliance agenda.”

Source: http://www.cvdfk.com