Interest in Forensic Data Analysis (FDA) investment is on the increase, according to the latest Ernst & Young (EY) Global Forensic Data Survey ‘Shifting into high gear: mitigating risk and demonstrating returns’.
Conducted with the help of 665 executives globally from nine industry sectors, including financial services, the 2016 survey found that organisations are increasingly looking to use forensic data intelligence to address growing current and emerging threats, as well as the increasingly complex regulatory environment.
In a foreword to the report, EY’s David Stulb and David Remnitz state: “In today’s digital world, there are expanding opportunities for innovation and growth. Unfortunately these new opportunities have also brought new fraud risks in the forms of cyber breaches and internal fraud.
“The mission-critical nature of information and the ease of digital access make organizations particularly vulnerable to cyber criminals and malicious insiders. Increasing regulatory pressure further compounds the need to address these risks with rigor.”
Survey results show that cyber breaches and insider threats such as fraud, IP theft, unauthorised trading, espionage or information technology (IT) sabotage are the fastest-growing threats in the fraud risk universe. Across the board, 62% of respondents reported increasing levels of concern over “cyber breach or insider threat” with 74% of respondents specifically from the Financial Services sector reporting an increased level of risk.
Increasing government and public scrutiny of fraud risk is also driving FDA demand, with 43% of respondents citing regulatory pressure as a major reason for investing in FDA. Overall, 69% of respondents claim they need to do more to improve their current anti-fraud procedures. This figure increased to 74% for C-suite respondents, who felt a stronger need for FDA adoption as a result of the threat of regulatory enforcement and risks attached to fraud.
Despite widespread acknowledgement of the value in FDA, the report claims the main benefits of FDA are not being fully realised. When asked, “What do you think are the main benefits of using FDA in your anti-fraud program?” only two in five respondents selected “reduced costs of anti-fraud program”. The report goes on to say that FDA can be an important enabler of cost reduction when used for tasks such as surveillance analytics, internal and external audit support, regulatory compliance and cyber breach investigations, but only when the right people and technological solutions are deployed.
To read the report visit ey.com, or click here