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Fraud, piracy plague Indian firms
July 08, 2003 21:36 IST
While more than 24 per cent of the Indian companies surveyed by the consultant PricewaterhouseCoopers reported experiencing significant economic crimes over the last two years, very few of these firms felt such crimes impacted their share price.
For its Global Economic Crime Survey 2003 released on Tuesday, PwC conducted 3,623 interviews with chief executive officers, chief financial officers at 1,000 companies in 50 countries and found that Africa topped the list with the highest number of economic crimes reported, followed by North America.
"At 26 per cent, product piracy was the most commonly reported economic crime in India. Interestingly, while 53 per cent of the respondents in India perceived corruption and bribery as the most prevalent economic crime, only 11 per cent reported to have suffered it," Ashwin Puri, head of corporate finance and recovery, PwC, India, said.
Interestingly, only a small number of respondents in India felt that economic crime had impacted their share price, PwC said in a statement.
"While this may be a comment on the perceived behaviour of the Indian markets, it may perhaps reflect higher tolerance for economic crime (in India)," it added.
"Far from being a victimless crime, fraud can have material and lasting impact on businesses and their reputation. Companies which have been fortunate enough not to have suffered from fraud should learn from those companies which have and invest in a comprehensive fraud risk management plan to withstand the persistent threat of economic crime," Puri said.
Globally, asset misappropriation is the single most commonly reported economic crime.
The PwC survey also found that globally, larger companies with over 1,000 employees in a country were most vulnerable to fraud with 52 per cent reporting economic crime in the past two years.
Financial services firms reported more incidence of fraud than any other industry, as per the survey.