Fraud in Australia: What is the economic cost?

Friday, 18 November 2011  Features

While estimates of the cost of fraud are laden with under-reporting and measurement issues, it is clear that fraud imposes a large economic cost on Australian organisations and society.

An academic from the Australian School of Business (ASB) has recently received funding for a research project that will investigate the state of fraud in Australia. Associate Professor Clinton Free was awarded an Australian Research Council (ARC) Future Fellowship for the project in the latest round of grants.

"The most recent Australian Institute of Criminology study of the cost of crime estimates that the cost of fraud offences in Australia exceeds $8.5 billion per annum, representing approximately 40% of the total of all crime categories, says Free.

"This research project will involve a multi-method approach including the use of surveys, industry-based focus groups, interviews and in depth qualitative fieldwork in both Australia and North America."

Associate Professor Free’s research will examine the most effective controls and risk management approaches for addressing fraud risk and the impact of group membership and collective action on the commission of fraud. It will also review the current approaches to measuring the impact of fraud in Australia.

The ARC Future Fellowship scheme aims to promote research of national importance through providing mid-career researchers with incentives to remain working in Australia. Associate Professor Free will receive in excess of $600, 000 over five years for the project.

ASB was also successful in a new ARC scheme commencing in 2012. Professor Valentyn Panchenko and Gloria Tian both won Early Career Research Awards (DECRA) and will receive more than $ 300, 000 over three years for their projects.