Next Tuesday is National Whistleblower Day in the United States, a special day to recognize individuals who play a critical role in exposing fraud and corruption. Their courage and commitment to integrity helps protect resources, upholds the law and promotes ethical business environments.
The day also commemorates our nation’s first whistleblower law, which was unanimously signed during the height of the American Revolution on July 30, 1778. Every year since 2013, the U.S. Senate has unanimously recognized that date as National Whistleblower Day.
Despite advancements in detection techniques and technology, awareness is still highly critical in combating fraud. This is especially true with occupational fraud, which the Association of Certified Fraud Examiners (ACFE) defines as, “The use of one’s occupation for personal enrichment through the deliberate misuse or misapplication of the employing organization’s resources or assets.”
The ACFE’s Occupational Fraud 2024: A Report to the Nations points to whistleblowers as being the most common source of occupational fraud discoveries. The study notes employees as being the source of over half of all whistleblower fraud referrals, also known as tips, but the statistics also shine a light on the importance of helping spread fraud awareness with outside parties like customers and vendors. In fact, fraud suspicion referrals from outside parties were reported as having made up nearly a third of whistleblower fraud suspicion referrals.
Over time, the communication channels in which whistleblower occupational fraud referrals are received have evolved as well. In years past, the telephone was the most common channel; now, however, the ACFE’s study also points to email and web-based forms having surpassed the telephone for fraud detection referral frequencies. These statistics highlight the importance of making a variety of fraud detection reporting channels, like dedicated hotlines, email addresses and/or web-based forms, available to not only employees but also customers and vendors.
For people to feel confident about coming forward with suspicions, organizations should value and empower whistleblowers with a strong tone from the top, fostering a culture of protection from retaliation, providing means for anonymous referrals and providing a community of support.
An investigation by an organization’s own team, or in tandem with outside forensic accountants, can ensure fraud suspicions and related evidence are sufficiently examined and help inform and prioritize remediation activities.
If your organization needs assistance with assessing fraud risk, fraud prevention strategy or investigating fraud suspicions, contact James Rumph in our Columbus office or Tom Pratt or Brian Webster in our Pittsburgh office.
About Schneider Downs Business Advisory
Our experienced team of business advisors consisting of Certified Fraud Examiners (CFEs), Certified in Financial Forensics (CFFs) and Certified Mergers and Acquisition Advisors (CM&AAs) leverages their industry expertise to maximize value and minimize risk during acquisitions, litigation, arbitration, corporate reorganization and other major business transactions and transitions. To learn more, visit our dedicated Business Advisory page.
