Theft of information and electronic data at global companies has risen in the past year and overtaken physical theft for the first time as the most widespread fraud, according to the latest edition of the Kroll Annual Global Fraud Report.
The study reveals that data theft was reported by 27.3 percent of companies over the past year, up from 18 percent in 2009. In contrast, reported incidences of theft of physical assets or stock declined slightly from 28 percent in 2009, to 27.2 percent in 2010.
Information-based industries reported the highest incidence of theft of information and electronic data in the past year. Financial services (42 percent in 2010 vs. 24 percent in 2009) and professional services (40 percent in 2010 vs. 27 percent in 2009) are most vulnerable to data theft.
As for the cost of fraud, Kroll says the total amount lost by businesses to fraud in the past year went from $1.4 million to $1.7 million per $1 billion of sales Ã¢â‚¬“ an increase of more than 20 percent.
Kroll also observed that the speed of technological developments poses new challenges in the fight against fraud.
Nearly one-third of companies (28 percent) reported information infrastructure complexity as the single most important factor in raising exposure to fraud. However, despite the increased risk, only 48 percent of companies are planning to spend more on information security in the next 12 months, down from 51 percent last year.
The findings are the result of a study commissioned by Kroll with the Economist Intelligence Unit or more than 800 senior executives worldwide.
TheÃ‚ Financial Times has more on this story.