Kenyan firms lose Ksh.5.5B due to fraud, corruption – Report

Kenyan firms lose Ksh.5.5B due to fraud, corruption - Report
(LEFT) Peter Ngahu, PwC partner during the release of the 2020 PwC Kenya Global Economic Crime and Fraud Survey report. PHOTO| COURTESY

Kenyan firms have lost a combined Ksh.5.5 billion from economic crimes including procurement fraud as well as bribery and corruption over the last 24 months.

According to the survey by consultancy firm PwC cases of bribery and procurement fraud have gone up significantly with at least one third of the 102 surveyed firms reporting losses in excess of Ksh.10 million in the period.

The survey carried out between 2018 and 2020 shows that 36% of Kenyan firms that experienced economic crimes lost over Ksh.10 million, with 2% reporting losing in excess of half a billion shillings.

The 2020 PwC Kenya Global Economic Crime and Fraud Survey report singles out at least six costliest crimes in corporate Kenya including; Procurement Fraud at 15%, Bribery & Corruption at 14%, Accounting/ Financial Statement fraud 14%, Asset Misappropriation 12%, Customer fraud 12%, Money laundering & sanctions 12%.

The report however highlights and lauds Government efforts in the fight against corruption with high profile arrests being made by the DCI and numerous graft cases being brought to the courts.

“Kenyan companies have become increasingly aware of crimes as the government moves to set the tone for the rapid containment of corruption,” says Peter Ngahu, PwC partner.

The report further says most of the fraud and crime were committed by internal operators at 36 per cent, external perpetrators at 27 per cent while 32 per cent of these were due to collusion between internal and external players.

Across the continent, bribery and corruption stood at 17 per cent in the period during the survey while accounting and financial statement related crimes stood at 15 per cent.

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