South Africa records highest fraud cases in Africa

by AKANI CHAUKE 
JOHANNESBURG, (CAJ News) – SOUTH AFRICA has recorded the highest number of occupational fraud cases in Sub-Saharan Africa, according to the Association of Certified Fraud Examiners’ (ACFE) latest Occupational Fraud 2026: A Report to the Nations, highlighting the urgent need for stronger due diligence, governance and fraud prevention measures.

South Africa accounted for 123 of the 397 occupational fraud cases reported across Sub-Saharan Africa, ahead of Nigeria with 64 and Kenya with 33.

The region represented 19 per cent of cases in the global study and recorded a median loss of US$97,000 per case.

The findings come as organisations face mounting risks from procurement fraud, corruption, supplier collusion, employee misconduct and increasingly sophisticated financial crime.

Globally, organisations lose an estimated five per cent of annual revenue to fraud each year.

The study, which examined 2,402 real-world fraud cases across 143 countries and territories, found that the typical occupational fraud scheme remains undetected for 12 months.

“Occupational fraud is not only a compliance issue. It is a significant business risk that directly impacts profitability, operational continuity and stakeholder trust,” said Riaan van Jaarsveld, Director at RiXForensica.

“Once fraud has occurred, recovery is often difficult, costly and, in many cases, incomplete. The most effective approach is to prevent high-risk individuals, suppliers and service providers from entering your business ecosystem in the first place.”

Corruption was the dominant occupational fraud risk in Sub-Saharan Africa, featuring in 56 per cent of cases.

Major asset misappropriation schemes included theft of non-cash assets and billing fraud, each accounting for 23 per cent, followed by cheque and payment tampering at 13 per cent and expense reimbursement fraud at 12 per cent.

Globally, asset misappropriation occurred in 90 per cent of cases, while corruption featured in 45 per cent.

Weak controls also remain a major vulnerability. More than half of global occupational fraud cases stemmed from inadequate controls or the overriding of existing ones.

Behavioural warning signs were present in 84 per cent of perpetrators, including living beyond their means, financial difficulties and unusually close relationships with vendors or customers.

Gordon Maeta, Director at RiXForensica, said due diligence should be viewed as a frontline fraud prevention strategy rather than an administrative exercise.

“Fraud frequently begins long before money leaves an organisation. It often starts during recruitment, supplier onboarding or procurement processes where critical checks are either rushed, overlooked or treated as a compliance tick-box exercise,” he said.

The ACFE found that collusion was particularly prevalent in Sub-Saharan Africa, involving 58 per cent of cases.

Managers accounted for 46 per cent of cases, employees 37 per cent and owner-executives 14 per cent.

Fraud recovery remains poor. Only 12 per cent of organisations recovered all losses, while 40 per cent achieved partial recovery and 49 per cent recovered nothing.

“The data reinforces a simple reality. Prevention is significantly less expensive than investigation, litigation and recovery,” van Jaarsveld said.

– CAJ News