Colombia ranked second worst in an international survey on business fraud published on Tuesday.
According to risk consulting company Kroll, its investigation “reveals a serious problem that could get worse. Despite the advantage of smaller average size, 94% of Colombian businesses suffered some fraud in the last year, compared to 88% globally. Moreover, 88% of the country’s respondents have seen their exposure increase, which is well above the survey average of 73%. Fraud is also stopping businesses from expanding: 52% of Colombian executives say their companies have been dissuaded from operating further in Latin America itself because of fraud.”
Colombia only finds China above it in the Kroll Global Business Fraud Report.
Kroll said the biggest concern of businesses in Colombia is vendor of procurement fraud. “24% of companies in the country experienced it in the last twelve months, against just 15% for the survey as a whole. Similarly, where respondents could identify who had committed a fraud in the last year, 21% of the time a vendor was the key perpetrator, a figure three times higher than the survey average.”
The risk consulting firm warned the problem is likely to spread, claiming “21% of companies reported IT theft or attack in this survey, and 42% that high staff turnover has increased their exposure, bringing the specter of a greater number of internal frauds.”
On the bright side, Kroll praised Colombian business investment in fraud prevention. “Planned investment for the next 12 months in these same strategies is 25% to 40% higher than in the rest of the world. Given the circumstances, this looks prudent,” the risk analyst said.