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This paper aims to explore the current trends in corruption and investigate the characteristics of corporate gift policies and their role in preventing bribery.

This is a descriptive study based on primary data from a recent sample of Canadian companies’ codes of conduct and secondary data from recent corruption surveys published by non-governmental organisations.

This study shows that 25% of all private and public corruption cases generate financial damages of more than US$1m per case and that 50% of all investigated fraud cases are corruption cases (ACFE, 2022). Furthermore, the Western Europe and EU region is perceived as least corrupt, whereas Sub-Saharan Africa is perceived as the most corrupt region (Transparency International, 2022). However, bribery is fairly common in nine EU countries where 10% or more of public service users bribed public officials to influence their decisions (Transparency International, 2021). Results from primary data show that 9.3% of firms put a total ban on gifts given to governmental officials, whereas 35.2% require a superior’s approval and only 5.5% state a dollar limit for the gift. Results also show that not a single firm prohibits the giving of gifts to non-governmental stakeholders or the receiving of gifts from any type of stakeholder. This paper argues that gifts can bias the recipient’s judgement and improperly influence future business decisions based on the gift’s subjective value, nature and context.

This paper extends previous research by examining the characteristics of corporate gift policies. It also helps organisations improve their gift policies in an effort to reduce corruption.

It is the first paper to investigate the characteristics of corporate gift policies and their role in preventing corruption.

This paper aims to explore how well reporting mechanisms work, investigate current trends and develop a framework for implementing effective mechanisms.

This study is based on primary and secondary data, criminology theory and best corporate strategies.

This study shows that the median number of annual reports equals 1.2 per cent of the number of employees in an organization and that 40 per cent of these reports have merit (Navex Global, 2014). In addition, 42.2 per cent of all frauds are detected through internal reports, whatever their form. Organizations with formal reporting mechanisms sustain fraud losses that are 40.5 per cent less than other organizations (ACFE, 2014). Moreover, employees are more willing to report theft, human resource and workplace issues than fraud and corruption, while 21 per cent of all whistleblowers have experienced some form of retaliation for reporting wrongdoing (Ethics Resource Center, 2014). Results from primary data show that the option to remain anonymous is offered only by 74 per cent of all reporting mechanisms. This paper argues that effective reporting mechanisms should actively encourage whistleblowing, that all credible allegations should be independently investigated and that whistleblowers should be offered the option to remain anonymous. The oversight and the daily administration of reporting mechanisms should be given to two different parties who are independent from management and who do not participate in incentive compensation plans (Lipman, 2012).

This paper extends previous research by reporting on current hotline trends and integrating various factors into a framework to implement effective reporting mechanisms.

It is the first paper to investigate the effectiveness of reporting mechanisms and current policy trends.

This study aims to analyse Rolls-Royce’s (RR) recent corruption case, its 2017 global anti-bribery and corruption (ABC) manual, and its 2017 annual report to assess whether it has put the best corruption prevention strategies into place.

This is a legal case study based on RR’s 2017 deferred prosecution agreement (DPA) with the UK serious fraud office. It uses the new ISO 37001 standard as a theoretical framework.

RR’s DPA suspends an indictment covering 12 counts of conspiracy to corrupt, false accounting and failure to prevent bribery. RR’s ABC manual exhibits significant shortcomings as compared to ISO 37001’s requirements. RR’s ABC manual does not provide any reference to the setting, reviewing and achievement of measurable anti-bribery objectives; does not state that anti-bribery training is provided at planned intervals to employees and external business associates that pose more than a low risk of bribery; does not explain the authority and independence of its head of ethics and compliance; does not state any maximum for gifts and hospitality given or received; does not provide clear assurances that reports made through its main internal channels will be treated confidentially and that complaints about senior management will be investigated by an outside firm; and does not subject its advisers to a formal due diligence process. RR’s annual report notes that it operates in an industry prone to corruption. Finally, internal control failure and compliance fatigue mean that no anti-bribery management system can be completely effective.

This paper extends previous research by analysing the best corruption prevention strategies that organizations can implement. It does not endeavour to certify whether RR is ISO 37001 compliant, and it analyses only publicly available documents.

This study’s prevention strategies will help deter corruption and improve internal controls within organizations.

No previous study has used the new ISO 37001 standard as a framework for such corruption case analysis.

This paper aims to investigate the extent of corruption globally, explains its social and economic consequences and introduces a model, composed of corporate governance mechanisms, internal controls and red flag analyses, which organizations can apply to prevent corruption.

This study uses criminology theories to analyze corruption and its prevention.

The global cost of bribery alone is estimated at US$1tn annually, not including costs resulting from non-completion and deficient completion of development projects (World Bank Institute, 2004). This paper shows that an effective prevention model should include a positive work environment and ethical governance; the implementation of a compliance risk management program with fraud risk assessments; an accessible psychological assistance program for employees; regular employee anti-fraud training; the implementation of targeted internal controls such as proper segregation of organizational duties; the adoption of fair compensation levels and realistic individual performance goals; a user-friendly and anonymous reporting mechanism; and independent and regular analyses of abnormal patterns (red flags).

This paper extends previous research by tying together disparate factors into a cohesive model for the prevention of corruption.

The prevention model developed in this paper assists in deterring corruption, improving internal controls, improving the likelihood of detection and reducing opportunities to perpetrate corruption. By reducing the risk of corruption, this model also helps organizations and governments reduce project costs (public spending) and improve project quality, thus promoting economic competitiveness.

A comprehensive prevention model is developed to help curtail corruption and its devastating effects.

This paper aims to analyze drug counterfeiting, explains its risk factors and operating and legal environments reviews recent legal cases and develops a multi-stakeholder prevention strategy that includes forensic accounting methods.

This is a theoretical study based on legal case studies and the best forensic accounting strategies.

Pharmaceutical drug counterfeiting is a fast-growing fraud that so far has attracted little attention from forensic accountants. A recent estimate projects that criminals collect around $75bn annually in illicit sales from counterfeit drugs (Bairu, 2015). Pharmaceutical counterfeiting also leads to the loss of lives when criminals use lethal chemicals in the manufacturing of fake medicines (Liang, 2006a; Brown, 2005). Because the detection of drug counterfeiting is extremely difficult after fake medicines have been ingested by patients, the strategy developed in this paper is based on early discovery by using reliable tracking technologies and inventory management controls in the supply chain, conducting effective regulatory and legitimate customs inspections, and increasing consumer awareness of basic forensic accounting tools.

This paper extends previous research by integrating various factors into a single multi-stakeholder prevention framework.

The paper presents a synthesized, comprehensive view of the drug fraud epidemic and analyzes concrete steps that can be taken to protect the pharmaceutical supply chain to reduce the loss of lives and monetary injuries.

No previous research has analyzed this issue from a multi-stakeholder point of view and used forensic accounting tools to complement a prevention strategy. The drug counterfeiting prevention strategy developed in this paper addresses the supply side, the regulatory enforcement side and the demand side.

The purpose of this paper is to analyze the effect of various internal controls (i.e. hotlines, regular ethics (fraud) training, surprise audits, internal and external audits and background checks) on reducing occupational fraud losses by victim organizations.

The paper, based on data from an occupational fraud report co-authored by the Association of Certified Fraud Examiners (ACFE) and Peltier-Rivest (2007), uses a multivariate regression analysis to analyze the effect of various internal controls on preventing fraud losses.

The authors’ analyses demonstrate that hotlines, regular ethics (fraud) training, surprise audits and internal audits all decrease fraud losses when used separately. However, hotlines and surprise audits are the only statistically significant controls when controlling for the potential correlation among all internal controls. Hotlines are associated with a reduction of 54 per cent in median fraud losses, while surprise audits cut median losses by 69 per cent.

This study contributes to academia and the anti-fraud profession by assessing the statistical effect of six internal controls on preventing fraud losses, while controlling for the potential correlation among these controls.

This study discusses the relative benefits (loss savings) of various internal controls to organizations, governments, managers and anti-fraud professionals. This information may help determine investment priorities in the context of scarce resources.

This paper is based on proprietary data owned by the ACFE and is the first to analyze the statistical significance of various internal controls on the reduction of fraud losses in Canada.

This paper aims to describe and explain characteristics of organizations that are victims of occupational fraud.

This study is based on a 2006 occupational fraud web survey conducted in Canada by the Association of Certified Fraud Examiners (ACFE).

The analysis shows that occupational fraud losses are quite large, accounting for a median loss of C$187,500 and a mean loss of C$1,142,494. These losses represent, respectively, 0.3 percent (median) and 9 percent (mean) of the victim organization's annual sales. Private companies, not‐for‐profit organizations and small businesses are particularly vulnerable to relatively larger fraud losses. It is also shown that the smaller the organization the more likely fraud losses will be relatively larger.

This study contributes to academia by measuring the statistical significance of the cost of occupational fraud per various organizational characteristics.

This study is useful to regulatory agencies and anti‐fraud professionals because it provides information about what types of organizations are more vulnerable to fraud, thus indicating where prevention and detection efforts should be directed.

This paper is based on proprietary data owned by the ACFE and is the first to analyze the statistical significance of the consequences (cost) of occupational fraud in Canada.

The purpose of this paper is to describe the characteristics of perpetrators of occupational fraud and their effects on organizations.

The study is based on a 2006 occupational fraud web survey conducted in Canada by the Association of Certified Fraud Examiners (ACFE) using a multivariate regression analysis to explain the effect of perpetrators' characteristics on fraud losses.

The authors' analyses show that the perpetrator's position (i.e. employee, manager, executive/owner), gender, education level and the presence of accomplices (i.e. collusion) appear to affect fraud losses when analyzed separately. However, only the perpetrator's position and collusion are statistically significant when controlling for the potential correlation among explanatory factors.

This study contributes to academia and the anti‐fraud profession by measuring the statistical effect of perpetrators' characteristics on fraud losses while controlling for the potential correlation among these characteristics.

This study is useful to regulatory agencies and anti‐fraud professionals because it provides information about the characteristics of perpetrators of occupational fraud, who are more likely to be associated with larger frauds, thus pinpointing where prevention and detection efforts may be most effective.

This paper is based on proprietary data owned by the ACFE and is the first to analyze the statistical significance of the characteristics of perpetrators of occupational fraud in Canada.