Outlook Business Desk
Corporate fraud in India is mostly internal and low-tech, finds a report by by KPMG. Procurement and operations make up more than half of the cases, with asset misappropriation and falsified documents being the most common, states KPMG’s Global Profiles of the Fraudster — India Outlook report. Whistleblowers detect about 38% of these frauds.
Corporate fraud in India works differently from other countries. Most cases are internal and low-tech, carried out by trusted employees who understand the company’s systems well. They exploit areas where checks exist and, more importantly, where no controls are in place.
According to the report, the typical Indian fraudster is a long-serving, respected employee with deep knowledge of the organisation. Their experience and authority earn trust, allowing them to commit fraud without detection and bypass internal checks. They are often aged between 26 and 45, working in operations or procurement, with over six years at the company.
In India, only 11% of fraud cases exceed $5 million, while globally, this figure stands at 22%, reported Business Standard. Indian fraud is therefore smaller in scale but more frequent, exploiting systemic weaknesses rather than using advanced digital tools.
The most common types of fraud in India are asset misappropriation and falsified documentation, similar to global trends. Bribery and corruption make up 14% of Indian cases, almost twice the global average of 6.9 %.
While greed and opportunity drive corporate fraud worldwide, in India most frauds are carried out by trusted insiders. Employees exploit gaps in systems and weak controls, using their authority and familiarity with processes to commit fraud, rather than relying on advanced digital tools.
Indian companies need to focus on their internal systems to prevent fraud. Paying close attention to procurement and vendor agreements, monitoring areas where employees have unchecked authority, and strengthening internal checks are important steps to reduce insider-driven fraud, the report notes.