Namibia's economic crime higher than global average

More than 50% of Namibian businesses have experienced economic crime.

At 53%, Namibia's rate of reported economic crime is slightly higher than the global average rate of 49%.

This is according to the Namibian edition of the Global Economic Crime and Fraud Survey 2018 conducted by PricewaterhouseCoopers (PwC).

According to the report, companies today face fraud risk from various avenues such as internal, external, regulatory and reputational fraud.

The survey found that only 20% of respondents in Namibia have conducted an anti-bribery or anti-corruption risk assessment, while one in five organisations cites asset misappropriation, bribery and corruption as an emerging threat.

Furthermore 18% of organisations have had to spend between twice and five times as much on investigations as the original amount lost to economic crime.

“Economic crime continues to disrupt business, with this year's results showing organisations that have experienced economic crime at 53% of the total respondents of 68,” according to the report.

It says accountability for fraud and economic crime has moved into the executive suite when economic crime and fraud occurs.

“Organisations are beginning to shed their denial complex regarding the many blind spots they have in identifying fraud and are learning how to address them,” the survey found.

According to the report, a total of 63% of Namibian respondents indicated that they have a high or extensive knowledge of fraud and economic crime, while the global response was 60%.

The report found that 6% of executives in Namibia, (Africa 5% and global 7%) did not know whether their respective organisations were being affected by economic crime or not.

Furthermore, 16% of Namibian respondents believe that cybercrime will be the most disruptive economic crime to affect their organisations over the next 24 months.

The report notes that a total of 39% of respondents in Namibia indicated that they have experienced fraud committed by the consumer crime, while globally 10% of respondents indicated that they experienced this type of fraud indicating that this fraud was the most disruptive type of economic crime experienced, followed closely by procurement fraud (at 9%). This shows the risk for fraud in the supply chain in Namibia.

“When combined with the instances of bribery and corruption reported at 25%, the resultant erosion in value from Namibia's GDP is alarming,” the report says.

A total of 92% of Namibian respondents, versus 91% of global and 94% of African respondents said the most disruptive incidents of economic crime were brought to the attention of the board executives or governance leaders within their organisations.

“It appears that Namibian organisations have taken an active stance in assuming control of the detection of fraud, with the detection of fraud beyond the influence of management at 39%.”

A total of 55% of Namibian respondents conducted general fraud risk assessments of their own volition.

Furthermore, 55% of Namibian organisations said they had conducted any kind of fraud or economic crime risk assessment.

It said shockingly, only around 13% of respondents had conducted an anti-bribery/anti-corruption risk assessment.

This is an especially worrisome statistic, considering how impactful and expensive this crime has become worldwide on both the regulatory and financial sides.

In Namibia, our survey revealed that the share of economic crime committed by internal actors is 58%.



ELLANIE SMIT