Economic Crime Survey: Transport and Logistics Supplement

The Transport and Logistics Industry Supplement highlights:

•          Mixed picture; whilst the overall percentage of T&L companies reporting incidents and the mean number of incidents were both down in comparison to 2005 survey results, average costs were up.

•          T&L companies experienced a somewhat lower rate of chance detection (30% vs. 40% across all industries), especially driven by lower rate of external tip-offs; corporate security was more effective in detecting fraud than in other sectors (16% vs. 4% across all industries). The latter trend may stem from measures introduced to fight terrorism and supply chain sabotage.

•          In contrast, internal audit detected fewer instances of economic crime in the T&L industry in 2007 – 17%, compared to 25% in 2005.

•          Overall T&L companies reported lower recovery rates than in other industries and compared to T&L in 2005, however they reported a higher rate of recovery (91%) when perpetrators face criminal charges.

•          There is room for improvement in company culture:

•          One-fifth of offenders came from the ranks of senior/top management

•          Nearly one fifth of companies chose to do nothing in response to serious incidents (19% vs. across all industries: 17%), up dramatically from 2005, when only 3% of T&L companies took no action.

•          T&L companies face extreme pressures to maintain narrow margins, which may create further future incentives for employees or management to commit economic crime.