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Kenya’s economic crime and fraud rate among highest in the world – PWC

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THE STAR 02 MAR 2020

The economic crimes rate in Kenya is way above global and continental averages, according to the latest Global Economic Crime and Fraud Survey by PricewaterhouseCoopers.

The survey shows that at least 75 per cent of Kenyans have experienced one form of economic crime in the past two years.

The report released on Monday shows 49 per cent of 7,000 respondents globally have been victims of economic crimes and fraud while 62 out of 100 people in Africa have encountered the same.

”In an already challenging economic environment, losses attributable to economic crime continue to prove a challenge for Kenyan organisations,” PWC said.

While consumers have always been victims of economic crime, In Kenya, fraud committed by consumers is listed as the second-most prevalent form of economic crime, after asset misappropriation.

According to the survey, fraud committed by consumers is at 35 per cent, similar to that of East Africa and the continental average. The global average on this segment is at below 30 per cent.

Even so, asset misappropriation continues to be the highest form of fraud experienced by survey respondents with Kenya reporting 57 per cent, almost similar to both global and Africa’s average.

According to PWC, global sensitisation on asset misappropriation fraud cases reduced its prevalence from 72 per cent in 2016 to 48 per cent.

Other forms of fraud reported in the survey includes procurement, bribery and corruption, accounting, human resource, money laundering, insider trading and intellectual property theft.

At 30 per cent incidence rate, bribery and corruption is the fourth most prevalent form of economic crime in Kenya, this despite Parliament enacting the Bribery Act of 2016, which became effective in January 2017, forming an imperative additional layer of legislation against which the enforcement agencies entrusted with the eradication of Bribery and Corruption can rely on.

Africa is highly susceptible to economic crimes, leading the world at 62 per cent in number of cases followed by North America and Latin America at 46 and 45 per cent respectively.

Eastern Europe, Asia Pacific and Western Europe have prevalent rates of 47,46 and 34 pr cent respectively. Middle East has the least reported incidences of 35 per cent.

”Of the 10 countries that reported the highest incidence rate of economic crimes globally, five we observe are African Countries, once again bringing into focus Africa as a region that is most severely affected by economic crimes,” PWC said.

Generally, economic crime and fraud cases have been surging across the globe, with PWC’s data indicating up to 16 per cent jump for listed regions since 2016.

In addition, 37 per cent of respondents in Kenya stated that the most disruptive economic crime over the past two years cost them at least $100,000 (Sh10 million)

”In an already challenging economic environment, losses attributable to economic crime continue to prove a challenge for Kenyan organisations,” the survey indicated.

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