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Illustrative image: Source code for a computer virus from the 1980s. Picture credit: Christiaan Colen (CC BY-SA 2.0) 

PwC’s 2018 Global Economic Crime and Fraud Survey states that Luxembourg companies, despite continuing to build their defences, continue to report a 42% crime rate since the 2016 survey. Gregory Coleman, ex-FBI agent and cybercrime expert even suspects that the number of actual crimes is being underreported to:

“…safeguard reputational damage as many companies are not aware of fraud risks they face and are not prepared on how to handle them.”

When it comes to screening and meeting regulatory requirements, companies in Luxembourg are good at AML/KYC (anti money laundering/know your customer), the report states, but adds that this is mostly due to companies placing their trust on off-the-shelf tools when it comes to transaction monitoring.

Michael Weis, partner and forensic services and financial crime leader at PwC Luxembourg cautions that:

“Although external actors account for 82% of the fraud committed, it is the internal, often senior, members of staff whose misconduct is the most damaging and difficult to detect.”

The report goes on:

“Beyond the cost of the actual crimes, additional costs accrue as a result of remediation and fines from increasingly vigilant regulatory agencies, to say nothing of inestimable reputational damage.”

Indeed, it claims that 18% of Luxembourg companies have estimated losses due to economic crime from €100,000 to €5 million.

Conclusion?

“Companies need to become more fraud aware and recognise what kind of issues they can face, including disruption of business processes, extortion and IP theft… They need to invest in people and sensitise them to recognise suspicious activities and report them to the right people for quick resolution, and not to assume that technology is the sole answer.”