Recession 'brings heightened fraud risk'

03 March 2009



Firms are exposed to heightened fraud risk during the global recession, insurance broker Marsh warns. Alongside its sister company Kroll, the company says businesses need to assess their situation and reduce the risk of being a victim of fraud.

"Companies are more likely to pay closer attention to their balance sheets during tougher times, which means that the chances of fraud being uncovered are far greater," comments Richard Abbey, Head of Kroll's London financial investigations practice. He adds that, at present, many instances of fraud are uncovered either by accident of [or] by whistleblowing.

Dean White, a Managing Director in the financial and professional practice at Marsh, asserts that the Fraud Act 2006 "was a landmark piece of legislation", although many firms are not aware of its implications. He says companies must adapt their policies in order to protect themselves against emerging criminal techniques and changes to legislation.

"Fraud can be devastating to a business, but recoveries can be effected if the management reacts quickly enough and strong freezing orders are put in place. Speed is the essence!" says B P Collins litigation and dispute resolution partner Matthew Brandis.

Posted by Matthew Brandis

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