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Consumer fraud is the 2nd most prevalent economic crime in Kenya and companies lost USD50M in the past 2 years alone

37 percent of reported fraud cases in Kenya have been as a result of consumer fraud.

According to a report released by PriceWaterhouseCoopers, 37 percent of reported fraud cases have been as a result of consumers exploiting loopholes and control weakness in organizations to commit fraud while undertaking legitimate transactions.

This puts consumer fraud as the second most prevalent economic crime in Kenya after fraud by internal actors which at 62 percent, is the biggest form of economic crime.

“Fraud is no longer just an operational or legal matter, it is now a central business issue. Fraud today is an enterprise that a tech-enabled, innovative, opportunistic and pervasive,” and adds, “capacity building of law enforcement entities is of utmost importance to help curb the vice.”

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According to the 2018 Global Economic Crime and Fraud Survey: Fraud the overlooked competitor, survey by PWC, fraud committed by the consumer, was the second most prevalent economic crime in Kenya,“indicating a possibly a societal problem where customers are becoming suspects,” said PWC Advisory Partner, Muniu Thoithi.

The report indicates that Kenya is leading in East Africa in economic crime having increased 14 percent to 75 percent in 2017, up from 61 percent in 2016.

“2% of Kenya respondents indicated that they lost between Sh500 million ($5M) and Sh5 billion ($50M) to the most disruptive economic crime they experienced in the past two years,” the report says.

In the survey, three-quarters of Kenyan respondents reported having experienced at least one form of economic crime in the past two years, a figure that is higher than the global average of 49% and the African average of 62%.

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The report indicates that cyber crime is set to be the most disruptive in the coming 24 months and urges for legislation and building of capacity for law enforcement officers to help curb the crime.

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Email: news@pulselive.co.ke

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