Where do you go from here?

The ACFE’s 2024 Report to the Nations states that 1,921 cases of fraud occurred in 2024, causing total losses of more than $3.1 billion. Canada and the U.S. accounted for 38 percent of cases with a median loss of $120,000 per incident of fraud.

It is important to remember that fraud may still be occurring even if it hasn’t been detected yet. The 2024 ACFE report shows that the average fraud scheme continued for 12 months before it was detected — and a business suffers greater financial losses the longer a fraud continues.

The results from this survey indicate that most Quebec businesses are unprepared to detect and respond to fraud. Additionally, many may be looking in the wrong direction — and not monitoring the areas where they’re most likely to uncover it. Overall, the findings from this study suggest some troubling trends that businesses must address to improve their fraud resilience and preparedness.

Following the five pillars of an effective fraud risk action plan can help you get started:

Perform regular fraud risk assessments

Your risk profile is constantly evolving as your business continues to grow — and even the slightest change can have a significant impact. Regular fraud risk assessments can help you understand what areas of your business are most vulnerable to fraud and the measures you can put in place to prevent it.

However, results from the 2024 survey showed that more than 40 percent of businesses did not perform external reviews of fraud risks or fraud controls in the last year. Additionally, a more concerning quarter of respondents never performed one. Performing fraud risk assessments enables businesses to proactively detect and mitigate potential fraud before it causes significant financial or reputational damage.

Put a tip line in place

According to the 2024 ACFE report, tips were the most common way that frauds were uncovered — with whistleblowers revealing 43 percent of all cases. However, responses to the 2024 survey showed that 84 percent of respondents do not have an alert hotline in place. Furthermore, a whistleblower hotline was one of the least likely measures to be implemented within Quebec businesses, with 30 percent of respondents unaware of this preventive measure. Setting up a hotline can help empower employees to come forward and voice their concerns about potential cases of fraud within your business.

Provide frequent anti-fraud employee training

Employees are one of your key assets in the fight against fraud. Frequent employee training ensures that they aware of the most recent fraud schemes and that risks and warning signs remain at the forefront of their minds. While it is beneficial to include anti-fraud training as part of the onboarding process, providing regular training can equip employees to identify red flags and report concerns. Furthermore, ACFE surveys show that employee fraud training can reduce the duration and cost of fraud by a third (33%).

Resist complacency

Employees with longer tenures were less likely to rate fraud as a high risk to their business. Long tenures can encourage complacency and prevent individuals from critically examining longstanding practices within the organization. Adopting a self-critical approach and regularly examining the policies, procedures, and controls in place within your business can help you break free from a mindset of complacency.

Work with external advisors

Eighty-two percent of Quebec business owners and senior executives encounter at least one obstacle impacting their efforts to implement effective anti-fraud measures. These obstacles include a lack of human resources, perceived costs, the complexity of procedures, resistance to change, and a lack of knowledge and skills.

External consultants can help overcome these obstacles by providing specialized knowledge and additional support to businesses. A third of survey respondents reported engaging external consultants or forensic accountants in their efforts to combat fraud.

Ninety percent of survey respondents perceived clear benefits in engaging with external consultants for fraud detection and prevention. These benefits included specialized expertise, an objective and impartial vision, the transfer of knowledge and training, a reduction in fraud risk, additional resources, and time savings.

Among those who used these external consultants in the past, 34 percent report engaging an external consultant or forensic accountant once a year or more often. All respondents who used external consultants were open to using them again, suggesting a high level of satisfaction with the security and assurance these professionals provide.