Despite the low incidence of economic crimes recorded in the country over the past two years, at least one in three companies in the Philippines expressed alarm over the possibility of falling prey to such threats in the near future.
Among the top economic crimes or fraud identified by 88 Philippine companies covered by the PricewaterhouseCoopers’ 2016 Global Economic Crime Survey (GECS) were asset misappropriation; bribery and corruption; cybercrime, procurement fraud, and human resources fraud.
Money laundering—news about which, specifically the $81-million Bangladesh central bank heist made headlines earlier this year—ranked 11th among economic crimes that local companies were worried about.
“Of the 13 types of economic crimes listed, bribery and corruption remained a serious issue in the country, a reflection of the Philippines’ consistently low ranking in Transparency International’s Corruption Index. Over the past 24 months, 25 percent of local companies were asked to pay a bribe, while 17 percent said they lost an opportunity to a competitor due to bribery,” the report stated.
“This survey is timely given the new administration’s focus on battling crime and corruption,” said PwC Philippines consulting managing principal Benjamin Azada.
Conducted in the last quarter of 2015, the Global Economic Crime Survey was released Thursday by PricewaterhouseCoopers Consulting Services Philippines Co. Ltd., a member firm of the PwC global network. The survey is conducted globally every two years and this is the first time PwC is publishing results about the Philippines. This year’s edition of the survey covered 6,337 respondents from 115 countries.
Results of the survey showed that in the past 24 months, companies in the Philippines experienced economic crime incidence of 20 percent, lower than the average of 30 percent seen in Asia Pacific and 36 percent globally.
Only 17 percent of Philippine companies polled said they were victims of cybercrimes over the past 24 months, lower than the 21 percent average in the Asia Pacific, and 26 percent globally.
Azada, however, opined that these numbers might be understated as there could be cases that a company was not aware that it had become a victim of an economic crime, specifically cybercrime. At times, it takes 18 months or so before such incidence can be detected.
“For example, 72 percent of the respondents claimed not to have been affected by cybercrime. However, these respondents could very well have been compromised without their knowledge due to the insidious nature of cybercrime. On mobile platform alone, the Philippines ranked 7th most attacked country out of the 213 studied by a cybersecurity firm,” the report indicated.
Financial losses from these economic crimes can run up to hundreds of millions of dollars, but the biggest impact cited by participants were on reputation and brand strength; employee morale, and relations with regulators.