Fraud Ascendant
Experts believe the recession will cause a spike in white-collar crime.
April 30, 2009 at 08:00 PM
6 minute read
One plague follows another. Recession-battered companies are at greater risk for criminal violations, warn experts who study corporate malfeasance. Like a virus that takes hold in a weakened immune system, fraud rears up when corporations are fighting for their lives.
“If you look back at history, when there's an economic downturn there's always a spike in fraud,” says Richard Plansky, a managing director in Kroll's business intelligence and investigations division. “The reason is pretty simple: Every fraud starts with a motive, and in times like this there are motives everywhere.”
Some frauds begin when people lose their jobs or when deals go bad. Other schemes crop up when employees are merely trying to keep the business afloat. And then there's the simple fact that receding financial waters expose crimes that have been there all along.
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