Organized Crime In The New Millennium

databases. Cifas is dedicated to the prevention of fraud, including internal fraud by staff,
and the identification of financial and related crime.
Cost
The typical organization loses five percent of its annual revenue to fraud, with a median
loss of $160,000. Frauds committed by owners and executives were more than nine
times as costly as employee fraud. The industries most commonly affected are banking,
manufacturing, and government.
Types of Fraudulent Acts
The falsification of documents, forgery or counterfeiting are types of fraud. The theft of
one's personal information, like Social Security number, or identity is type of fraud.
Fraud can be committed through many media, including mail, wire, phone, and the
Internet (computer crime and Internet fraud). International dimensions of the web and
ease with which users can hide their location, the difficulty of checking identity and
legitimacy online, and the simplicity with which hackers can divert browsers to dishonest
sites and steal credit card details have all contributed to the very rapid growth of Internet
fraud. In some countries, tax fraud is also prosecuted under false billing or tax forgery.
There have also been fraudulent "discoveries", e.g., in science, to gain prestige rather
than immediate monetary gain.
Anti-Fraud Movements
Beyond laws that aim at prevention of fraud, there are also governmental and nongovernmental
organizations that aim to fight fraud. Between 1911 and 1933, 47 states
adopted the so-called Blue Sky Laws status. These laws were enacted and enforced at
the state level and regulated the offering and sale of securities to protect the public from
fraud. Though the specific provisions of these laws varied among states, they all
required the registration of all securities offerings and sales, as well as of every U.S.
stockbroker and brokerage firm. However, these Blue Sky laws were generally found to
be ineffective. To increase public trust in the capital markets the President of the United
States, Franklin D. Roosevelt, established the U.S. Securities and Exchange
Commission (SEC). The main reason for the creation of the SEC was to regulate the
stock market and prevent corporate abuses relating to the offering and sale of securities
and corporate reporting. The SEC was given the power to license and regulate stock
exchanges, the companies whose securities traded on them, and the brokers and
dealers who conducted the trading.
Detection
For detection of fraudulent activities on the large scale, massive use of (online) data
analysis is required, in particular predictive analytics or forensic analytics. Forensic
analytics is the use of electronic data to reconstruct or detect financial fraud. The steps
in the process are data collection, data preparation, data analysis, and the preparation
of a report and possibly a presentation of the results. Using computer-based analytic
Page 130 of 372