Which industries are seeing the biggest increase in fraudulent activity?

From artificial intelligence to residential proxies, we are now utilising technology in so many ways, and, because of this, it is more important than ever to stay safe online. The unfortunate truth is that most job sectors have fallen victim to fraud on one occasion or another.

With an estimated global loss of $3.6 billion in 2022 alone, there has been a sharp rise in fraudulent activity over recent years, but which industries have been affected the most? To answer this, we have delved into data from the last few years to find out about the current state of occupational fraud.

The transportation and warehousing industry has seen a 20.59% increase in fraud cases since 2016 – more than any other industry

No matter which industry you have ties to, there is a likelihood that fraud has been committed. Unfortunately, some industries have been impacted more than others in recent times – but which sectors have seen the biggest increase in fraudulent cases? Here’s what we found.

1. Transportation and Warehousing - 20.59% increase in fraudulent cases

The industry of transportation and warehousing takes the top spot in this list of sectors with the biggest increase in fraudulent cases. This industry covers a lot of important ground, including the transportation of cargo and passengers, and the storage of goods. Sadly, not everybody values the work that is done within this industry, as there has been a 20.59% increase in fraud cases between 2016 and 2022. Some common types of fraud in the transportation and warehousing industry include falsifying delivery documents and posing as an authentic carrier to help assist criminals to steal cargo loads.

2. Technology - 13.51% increase in fraudulent cases

With a 13.51% increase in fraudulent cases, the technology sector appears second on this list. With constant advancements in technology, we are now utilising it in more ways than ever, but unfortunately so are fraudsters. With a total of 84 fraudulent cases in 2022 it appears that people are finding innovative ways to outsmart computers. Recording fake sales transactions has become a known form of fraud in this industry which allows business scammers to inflate their sales figures.

3. Religious, Charitable, or Social Services - 11.54% increase in fraudulent cases

Completing this top three list of the industries that have seen the biggest increase in fraudulent cases between 2016-2022 is the sector of religious, charitable, or social services. People have been exploiting the kind nature of this industry by executing charity-based scams. As a result, this industry has been the subject of an 11.54% increase in fraudulent cases when comparing the number of cases in 2016 to those in 2022.

The real estate industry is losing the most money as a result of fraud, with a 117.50% change in financial losses since 2016

1. Real Estate - 117.50% increase in financial loss as a result of fraud

It is no secret that you can earn a lot of money in real estate, but it appears that you can also lose a lot if you are the victim of fraud in this industry. Between 2016 and 2022, there has been a 117.50% increase in financial loss when it comes to fraudulent activity in real estate. As more and more businesses are using the internet to promote their products, it is likely that website impersonation has enabled fraudsters to take money from innocent people, thus contributing to the $435,000 median financial loss in 2022.

2. Utilities - 96.08% increase in financial loss as a result of fraud

You may not even be aware, but the utility industry is a common place for fraudsters - evidenced by the 96.08% increase in financial losses since 2016. As the cost of living continues to increase, we have even more reason to save on utilities and bills. However, this has led people to fraudulently use another person’s name to purchase these services. The scope of fraudulent activity doesn't stop there though, as scammers in this industry have also been known to imitate firms in order to obtain payments from unsuspecting customers.

3. Transportation and Warehousing - 74.83% increase in financial loss as a result of fraud

The transport and warehousing industry was featured earlier in this fraud index, so it may come as no surprise that it is featured here too. As mentioned above, fraudulent activity can take many different forms within this industry, and this gives fraudsters more opportunities to make money. Bearing this in mind, the unfortunate truth is that this industry has been subject to a 74.83% increase in financial loss as a result of fraud in recent years.

64% of all fraud cases in the energy industry are the result of corruption - more than any other industry

In the 2022 ‘Occupational Fraud: A Report to the Nations’ it was revealed that corruption is the most common type of fraud across every one of the thirteen industries studied, but which have been affected the most by corruption? Here’s what we found.

1. Energy - Corruption makes up 64% of all fraud cases

64% of all 97 fraud cases in the energy sector were related to corruption, this is the highest percentage in any industry studied. Corruption within this industry often takes the form of energy sector officials giving out licenses or contracts in exchange for monetary bribes. As this is such an indispensable industry, it is a shame to see such high levels of corruption.

2. Manufacturing, Transportation and Warehousing - Corruption makes up 59% of all fraud cases

A total of 59% of all fraud cases in the manufacturing, transportation and warehousing industries are due to corruption. Both of these sectors are vulnerable to the effects of bribery in their respective industries, and this is evident by their second-place entry in this list.

The manufacturing sector relies on complex supply chains for which people need licences and permits. Even though these factors are put in place to ensure the safety of information and products, it has opened the door to a large number of corruption cases. In addition to this, the transportation and warehousing industry has featured earlier in this fraud index, and it is likely that there is a link between the high levels of corruption and financial loss.

With 625 fraudulent cases in 2022, the United States has the highest number of cases in the world

Whether you live in a big city or a farm town, fraud cases are everywhere - but which locations have been impacted the most? Below is a list of the countries with the highest number of fraudulent cases in 2022.

1. The United States - 625 fraudulent cases in 2022

As the third largest country by area and population, it seems that the United States is a hotspot when it comes to fraud. The US amassed a total of 625 fraudulent cases in 2022 alone which is more than any other country in the world. The US hit the headlines last year when James Zhong pled guilty to unlawfully obtaining over $3 billion in cryptocurrency. This case of web fraud is the largest financial seizure to have taken place in the US as of today.

2. South Africa - 188 fraudulent cases in 2022

Next on this list is South Africa which saw 188 cases of fraud in 2022 - the second highest in the world. Recently it was reported that over 60 members of staff at a bank in South Africa were charged with fraud after they were caught activating customer accounts improperly.. Although this may not have the same financial repercussions as some other fraud cases, they negatively impact the industry in question.

3. Nigeria - 61 fraudulent cases in 2022

Completing this top three list of the countries with the highest number of fraudulent cases is Nigeria. Located in West Africa, this country has seen its fair share of fraud in the last year, totalling 61 cases throughout 2022. Similarly to the second-place entry on this list, the most reported cases of fraud in this country are related to banking fraud in which scammers attempt to make some quick cash.

Methodology

We used the 2016 and 2022 editions of ‘Occupational Fraud: A Report to the Nations to find the number of occupational fraud cases, median loss for each industry, the most common type of fraud for each industry, and the countries with the most fraud cases in 2022.

We took the number of fraudulent cases in 2016 and subtracted this number from the number of cases in 2022 before dividing this number by the 2022 total to calculate the percentage change in the number of cases between 2016-2022 for each industry.

Similarly, we took the median financial loss in 2016 and subtracted this number from the median financial loss in 2022 before dividing this number by the 2022 total to calculate the percentage change in median financial loss between 2016-2022 for each industry.