QUICK LINK: Download the whitepaper here – no registration is required.

Within the retail industry, it’s commonly known that internal fraud – that is, losses that occur because of employees – account for the majority of thefts and losses suffered by retailers. With the one exception of organized retail crime, these internal losses are typically the biggest concern for retailers’ loss prevention (LP) and asset protection (AP) departments.

Internal loss comes in a variety of forms. At the simplest level, asset misappropriation activities such as skimming (taking cash before it hits the books) and larceny (stealing cash and product that is already on the books) can be pervasive throughout the organization, from the stores to the warehouse to corporate HQ. At a more complicated level, corruption activities such as embezzlement are often more isolated to senior management levels, and are often very difficult to detect.

In their latest Report To The Nations, the Association of Certified Fraud Examiners (ACFE) surveyed corporations and independent CFEs worldwide to discover three key sets of data:

  1. The types of fraud events that organizations typically experience
  2. The total dollar amount associated with each type of fraud event
  3. The average amount of time it takes to detect a fraud event

The report was both fascinating and sobering. Overall, most organizations lose five percent of their annual revenues to fraud. Factor in the low margins of retailers, and this becomes an extremely significant hit to the bottom line. Even more troubling, however, is that fraud events often go undetected for as long as two years. Early detection, and technology that enables early detection, therefore becomes paramount to organizations that suffer regularly from these losses. It can make the difference between profitability and significant losses.

We have taken the 2010 Report To The Nations and analyzed the key points that are relevant to retail LP and AP professionals. In particular, we look at the impact that early detection has on reducing losses suffered as a result of fraud. The white paper is available for download by clicking on this link, and no registration is required. Please feel free to distribute this white paper, and your feedback is appreciated.