financial crimes survey presentation
Post on 04-Jun-2018
213 Views
Preview:
TRANSCRIPT
-
8/13/2019 Financial Crimes Survey Presentation
1/27
Financial Crimes SurveyRe ort 2013
Where is the exposure?
Robert Nyamu
Director, Deloitte Forensic Services East frica
-
8/13/2019 Financial Crimes Survey Presentation
2/27
Contents
Overview
Prevalence, modes and impact
Financial crime prevention and
AML regulatory frameworks acr
2
of financial crimes
detection mechanisms
oss East Africa
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
3/27
Overview
3
-
8/13/2019 Financial Crimes Survey Presentation
4/27
Respondents by Sector
4
The spread of respondents per sector
was as follows: Banking sector 69%
Insurance 25%
Real Estate 3% and
Capital Markets 3%
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
5/27
Asset Base of Respondents
5
63% of the respondents have an asset
base of over US$ 3.5M10% have an asset base of betweenUS$ 1.2M and 3.5M
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
6/27
Domicile of respondents
6
The spread of respondents in the region
was as follows: 38% are based in Kenya.
22% are based in Uganda
22% have a Regional Presence
9% are based in Tanzania
9% have a Global presence
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
7/27
Prevalence,mpac s ocrimes
7
odes and anc a
-
8/13/2019 Financial Crimes Survey Presentation
8/27
Prevalent forms of financial cri
8
The top three most prevalent forms of financial cri
Cash theft at 72% in Kenya, 67% in Uganda an
Cheque fraud at 44% in Kenya, 50% in Ugand
Asset misappropriation at 33% in Kenya, 25% i
e
2013. For information, contact Deloitte & Touche
e across East Africa are:
d 71% in Tanzania.
and 14% in Tanzania.
n Uganda and 29% in Tanzania.
-
8/13/2019 Financial Crimes Survey Presentation
9/27
Common ways of perpetrating f
9
inancial crimes
Across East Africa, perpetration of
financial crimes commonly involvesa combination of internal andexternal parties.
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
10/27
Most likely to perpetrate interna
10
l financial crimes
Across the region, most respondents
indicated that non-management personnelwere most likely to perpetrate financialcrimes in the organisation.
It is interesting to note that it is only in Kenyawhere senior management is considered
likely to perpetrate financial crimes within theorganisation
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
11/27
Likely causes of prevalence of f
In Kenya, 57% of the respondentsfeel that the most likely cause offinancial crimes is the abundant
liquidity in the industry which makes itattractive to fraudsters.
In Uganda, 50% of the respondentsfeel that the most likely causes offinancial crimes are:
Abundant liquidity in the industrywhich makes it attractive to
Weak or inadequate financialcrimes controls; and
Manipulation of data andcircumvention of IT controls.
In Tanzania, 50% of the respondentsfeel that the most likely causes offinancial crimes are:
Weak or inadequate financialcrimes controls; and
Diversity of products which are
not matched with robust controlsmechanisms.
11
inancial crimes
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
12/27
Prevalence, modes and impact
Extent of threat posed by financial crimes
When asked if financial crimes are posing a
serious threat to the growth and expansion of theindustry, most of the respondents in the regionstated that it was a threat, but only to a smallextent
Perceived extent of annual losses throughfinancial crimes
12
36% of respondents in Kenya and 25% ofrespondents in Tanzania stated that the industry islosing more than ten million US dollars as a resultfinancial crimes annually.
In Uganda, 29% of therespondents stated thatthe industry is losingbetween one million andten million US dollars asa result of financial crimesannually
of financial crimes
2013. For information, contact Deloitte & Touche
f
-
8/13/2019 Financial Crimes Survey Presentation
13/27
Perceived extent of annual loss
19% of the respondents in the bankingsector feel that annual losses are likely to
be above ten million dollars.
13
s in key sectors
2013. For information, contact Deloitte & Touche
In the insurance sector, 25% of therespondents feel that annual losses arelikely to be above ten million dollars
-
8/13/2019 Financial Crimes Survey Presentation
14/27
Impact of financial crimes
Across the region, 100% of the respondents feel threputational damage.
In Kenya, this is followed by actual financial loss atactual financial loss both at 50%.
In Tanzania, 100% of the respondents also feel tha
organizations.
14 2013. For information, contact Deloitte & Touche
t the greatest impact of financial crimes is
71%, in Uganda by regulatory & legal risks and
t actual financial loss has a great impact on their
-
8/13/2019 Financial Crimes Survey Presentation
15/27
Financial cripreven on anmechanisms
15
e e ec on
-
8/13/2019 Financial Crimes Survey Presentation
16/27
Financial crimes prevention me
In all three countries, the majority of the respondenduties & job rotation as mechanisms to mitigate fin
In Kenya, the second most commonly used mecha
background checks on employees prior to recruitm
16
hanisms
2013. For information, contact Deloitte & Touche
s stated that they have implemented segregation of ncial crimes.
ism to mitigate financial crimes is conducting of
nt.
-
8/13/2019 Financial Crimes Survey Presentation
17/27
Financial crimes detection mec
17
anisms
Across East Africa, most
respondents conduct riskbased internal audits:
100% in Kenya;
83% in Uganda; and
100% in Tanzania.
Most organizations also
2013. For information, contact Deloitte & Touche
con uc r s asetransaction monitoring onan ongoing basis:
71% in Kenya;
67% in Uganda; and
50% in Tanzania
-
8/13/2019 Financial Crimes Survey Presentation
18/27
Effectiveness of financial crime
mechanisms
Prevention
Majority of the respondents stated that the
financial crimes prevention mechanismswere effective in their organizations.
However, a small minority in Kenya who feelthat the mechanisms in place were noteffective.
18
prevention and detection
2013. For information, contact Deloitte & Touche
Detection
Majority of respondents stated that financial
crimes detection mechanisms are effectivein their organizations. 17% of therespondents in Uganda and 21% of therespondents in Kenya stated that thefinancial crimes detection mechanisms inplace are very effective in their organizations
-
8/13/2019 Financial Crimes Survey Presentation
19/27
Financial crime prevention and
Transaction monitoring systems
Across the region, 67% of banks do not have
and reporting of suspicious and cash transactsystem.
None of the insurance companies have an aureporting of suspicious and cash transactionsthat they have virtually no cash transactions
19
detection mechanisms
automated systems to facilitate monitoring
ions, while 5% have a semi automated
tomated system to facilitate monitoring and . Some of the insurance sector players stated
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
20/27
Remediation measures
Across the region, 86% of the banks stated th
program to fill in gaps in customer due diligen88% of insurance companies stated that they
20
t they have a retrospective remediation
e information for existing customers, while o not have such measures in place.
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
21/27
Responsibility for dealing with
organization
The majority of the respondents in Kenya and
and senior management are responsible for dorganizations.
The majority of the respondents in Uganda stcompliance team as well as senior managemorganizations
21
inancial crimes in the
Tanzania stated that the internal audit team
ealing with financial crimes in their
ted that it is the responsibility of the risk and nt to deal with financial crimes in their
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
22/27
AML regulatoramewor s aAfrica
22
ry ross as
-
8/13/2019 Financial Crimes Survey Presentation
23/27
Perceived effectiveness of AML
A majority of the respondents in Kenya and T
framework is effective in combating financialUganda feel that the framework is not effectivdue to the lack of the necessary legislation.
23
regulatory framework
anzania feel that the AML regulatory
rimes. However, 83% of the respondents in e in combating these vices, which should be
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
24/27
Perceived effectiveness of AML
sectors
67% of the respondents from the banking sec
insurance sector stated that the AML regulatofinancial crimes.
24
regulatory framework for key
tor and 50% of the respondents from the
ry framework is effective in combating
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
25/27
Existence of AML compliance f
Across the region, the majority of the orgAML compliance frameworks in place.
25
ameworks for key sectors
nizations stated that they have
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
26/27
Components of AML complianc
26
e frameworks for key sectors
2013. For information, contact Deloitte & Touche
-
8/13/2019 Financial Crimes Survey Presentation
27/27
Deloitte refers to one or more of Deloitte Touche Tohmatsu Limited, a UK private coeach of which is a legally separate and independent entity. Please see www.deloitte.Deloitte Touche Tohmatsu Limited and its member firms.
Deloitte provides audit, tax, consulting, and financial advisory services to public andconnected network of member firms in more than 150 countries, Deloitte brings worldelivering the insights they need to address their most complex business challenges.committed to becoming the standard of excellence.
2013. For information, contact Deloitte & Touche
27
pany limited by guarantee, and its network of member firms, com/about for a detailed description of the legal structure of
rivate clients spanning multiple industries. With a globally -class capabilities and high-quality service to clients,
. Deloitte has in the region of 200,000 professionals, all
top related