The risk of fraud is a serious concern for all types of enterprises, but fraud can be particularly damaging to a nonprofit or not-for-profit organization, for which a damaged reputation can have devastating consequences.» Read More
According to the most recent global fraud study by the Association of Certified Fraud Examiners (ACFE), the typical organization loses an estimated 5 percent of its annual revenue to fraud. While fraud in nonprofit organizations resulted, on average, in a smaller net loss than fraud in commercial enterprises, the nonprofits in the study reported a median loss of $100,000 – a significant loss to any charitable organization!
Beyond the immediate financial loss, however, an even greater potential cost of fraud to nonprofit organizations is the reputational damage that can occur. Because most nonprofits depend on support from donors, grantors, or other public sources, their reputations are among their most valued assets. In addition, fraud in nonprofit settings often garners unrelenting negative media attention.