the changing role of analytics in fraud investigation · the changing role of analytics in fraud...

©2015

THE CHANGING ROLE OF ANALYTICS IN FRAUD INVESTIGATION

For business executives in multiple functions across many industries and geographies, big data

presents tremendous opportunities. For those charged with deterring, detecting, and investigating

misconduct, mining such data can be a particularly powerful tool in their overall compliance and

anti-fraud efforts. This session will look at the importance of identifying the right tools and

turning big data into information. It will also share insights from the recent EY Global Forensic

Data Analytics Survey 2014.

You will learn how to:

Use forensic data analytics (FDA).

Choose the right tools for the job.

Look for missed opportunities.

ROSLYN LEE, ACA

Senior Manager, Fraud Investigation and Dispute Services & Data Analytics

EY

Ireland

Roslyn Lee is a senior manager in the Fraud Investigations and Disputes team in EY Ireland. She

has more than 14 years of experience in the professional services industry. Having joined EY in

2000, Lee led the audits of a number of large pharmaceutical and technology clients. She

specializes in audit risk assessment and the implementation of data analytics for financial audit.

She is highly experienced in performing fraud risk assessments and designing data analytics

procedures to address those fraud risks. More recently, Lee has also led a number of high-profile

fraud investigations in the financial services sector, where she used data analytics to quickly

develop an understanding of transactions and cash flows.

“Association of Certified Fraud Examiners,” “Certified Fraud Examiner,” “CFE,” “ACFE,” and the

ACFE Logo are trademarks owned by the Association of Certified Fraud Examiners, Inc. The contents of

this paper may not be transmitted, re-published, modified, reproduced, distributed, copied, or sold without

the prior consent of the author.


2015 ACFE European Fraud Conference ©2015 1

NOTES In this session, we look at the following areas:

1. Setting the Scene: 13th EY Global Fraud Survey—

Unethical Behaviour Still Exists

2. Why Use Forensic Data Analytics (FDA): Key Benefits

and Adoption

3. Technology: The Right Tools for the Right Job

4. Missed Opportunities: Turning Data into Information

We will also walk through two examples of FDA: 1)

structured data and 2) unstructured data

13th EY Global Fraud Survey (link)

To start this journey we will walkthrough some results

from the 13th EY Global Fraud Survey. This survey was

conducted between November 2013 and February 2014.

The researchers conducted 2,719 interviews with various

executives in 59 countries and territories. The survey

approach details are included in Appendix A of this

document.

We will link some of the results from this survey back to

the fraud triangle, and we will also consider the regulatory

pressures companies are under and the complexity and

frequency of frauds occurring.

http://www.ey.com/Publication/vwLUAssets/EY-13th-Global-Fraud-Survey/$FILE/EY-13th-Global-Fraud-Survey.pdf



NOTES

We will then consider what all this means for us.

Why Use Forensic Data Analytics (FDA): Key Benefits

and Adoption

This session will be driven by the results from the EY

Global Forensic Data Analytics Survey 2014, Big Risks

Require Big Data Thinking. The survey approach details

are included in Appendix B of this document.

We will define what we mean by FDA, as well as the

benefits of FDA.



NOTES When considering the benefits of FDA we will consider:

The most recent ACFE Report to the Nations on

Occupational Fraud and Abuse

How FDA can enhance the risk assessment process and

improve fraud detection

Where FDA is deployed



NOTES Embedding Analytics in Our Fraud Investigation

Approach

It was noted in the EY Global Forensic Data Analytics

Survey 2014 that the majority of people surveyed primarily

focus on the upper-left quadrant, or the traditional rule-

based, descriptive queries and analytics. The future of FDA

lies in statistical analysis and data visualisation and text

mining.

We will also look at the key attributes of using FDA and

how FDA efforts align well with perceived company risks.



NOTES Top Fraud Risk Concerns

We also consider what the users of FDA consider the main

benefits of using FDA in their anti-fraud and anti-bribery

program, and some common testing areas of FDA in

investigations.

And finally in this section, we will look at where FDA is

deployed:



NOTES

We will then transaction to our next session.

Technology: The Right Tool for the Right Job

It should be noted that there is definite room for

improvement for more sophisticated FDA technologies.

When the following question was put to our survey

participants, a large majority of them identified the basic

tools—Microsoft Excel and Access SQL—as tools they

frequently used, with fewer using visualisation or big data

technologies.

From the tools mentioned, which, if any, are you currently

using in your organisation?



NOTES

In this session, we also look at what we mean by structured

and unstructured data. This will then lead us to consider the

final area—Missed Opportunities: Turning Data into

Information, and indeed the next steps.

65%

43%

29%

26%

26%

21%

21%

11%

2%

2%

0% 10% 20% 30% 40% 50% 60% 70%

Spreadsheet tools such as Microsoft Excel

Database tools such as Microsoft Access or…

Continuous monitoring tool, which may include…

Text analytics tools or keyword searching

Forensic analytics software (ACL, iDEA)

Social media/web monitoring tools

Visualisation and reporting tools (Tableau,…

Statistical analysis and data-mining packages…

Big data technologies (Hadoop, Map Reduce)

Voice searching and analysis (NEXIDA, NICE)



NOTES



NOTES

We have identified that the missed opportunities relate

mainly to lack of awareness and expertise. We look at these

and consider how we can change them to ensure more

awareness. We will finally consider the five success factors

to embedding FDA in organisations.



NOTES Sources

EY, Big Risks Require Big Data Thinking, Global

Forensic Data Analytics Survey, 2014.

Association of Certified Fraud Examiners, Report to the

Nations on Occupational Fraud and Abuse, 2014.

EY, 13th Global Fraud Survey, Overcoming

Compliance Fatigue: Reinforcing the Commitment to

Ethical Growth.



NOTES Appendix A: 13th EY Global Fraud Survey Approach



NOTES



NOTES Appendix B: EY Global Forensic Data Analytics Survey

2014, Big Risks Require Big Data Thinking, approach

The information in this pack is intended to provide only a

general outline of the subjects covered. It should not be

regarded as comprehensive or sufficient for making

decisions, nor should it be used in place of professional

advice.

Accordingly, Ernst & Young accepts no responsibility for

loss arising from any action taken or not taken by anyone

using this pack.



NOTES The information in this pack will have been supplemented

by matters arising from any oral presentation by us, and

should be considered in the light of this additional

information.

If you require any further information or explanations, or

specific advice, please contact us and we will be happy to

discuss matters further.

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