World Economy

Economic Crime in South Africa at Record High

Half of world’s top ten economic crimes emerge from the African continent.Half of world’s top ten economic crimes emerge from the African continent.

South African organizations continue to report the highest instances of economic crime in the world with economic crime reaching its highest level over the past decade, according to PwC’s biennial Global Economic Crime Survey released Tuesday.

The survey was presented to the media at the African Pride hotel in Melrose by Trevor White, Partner at Forensics Services PwC and Trevor Hills, lead partner for PwC’s Forensic Services Practice, IOL reported.

The amount of economic crime being reported around the world showed that half of the top ten emerge from the African continent.

PwC said that South African organizations that have experienced economic crime is now at a staggering 77%, followed in second place by Kenya (75%), and thirdly France (71%).

The Global Economic Crime and Fraud Survey examines over 7,200 respondents from 123 countries, of which 282 were from South Africa.

Trevor White said, “Economic crime continues to disrupt business, with this year’s results showing a steep incline in reported instances of economic crime. At 77%, South Africa’s rate of reported economic crime remains significantly higher than the global average rate of 49%. However, this year saw an unprecedented growth in the global trend, with a 36% period-on-period increase since 2016.”

PwC further said that economic crime in South Africa is now at the highest level over the past decade. It is also alarming to note that 6% of executives in South Africa (Africa 5% and global 7%) simply did not know whether their respective organizations were being affected by economic crime or not.

“We have seen paradigm shifts in the way that businesses are being run. Notably, the accountability for fraud and economic crime has moved into the executive suite, with the C-suite increasingly taking responsibility, and the fall, when economic crime and fraud occur. Organizations are beginning to shed their denial complex regarding the many blind spots they have in identifying fraud and are learning how to address them,” White further explained.

“The truth is that when businesses misbehave, investors often tend to look the other way as long as their investment is not threatened. The C-suite should be careful not to do the same. We often see that organizations can be easily lured into a false sense of security when scenarios appear to be rosy and when the ‘tone at the top’ appears to be consistent with the right words. What really counts is not the tone at the top, but rather action at the top. The market may love disruptors or outperformers–but not enough to tolerate bad behavior,” Hills concluded.

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