20 November 2015 Detecting and preventing fraud in the delivery of public services in a digital world

2 COPYRIGHT © 2015 OAKTON Australian firms too 'complacent' about corruption The World Today, 17 Sep 2015 “The report argued that, while corruption is low in Australia, other studies suggest the incidence is growing amid recent high profile cases, such as the insider trading scandal involving an employee from the National Australia Bank and a worker from the Australian Bureau of Statistics, who were both acting for their own profit. Other companies that have faced corruption allegations in Australia include former Reserve Bank subsidiaries, Securency and Note Printing Australia, BHP Billiton, AWB, and Leighton Holdings.” The World Today Digital fraud is a strategic threat to our organisations and should be treated accordingly

3 COPYRIGHT © 2015 OAKTON THE DIGITAL LANDSCAPE s – 1990s –

COPYRIGHT © 2016 OAKTON Gartner 2015 Digital technologies — mobile, social, big data and cloud — are disrupting businesses everywhere by revolutionising the role technology plays in our everyday lives.

5 COPYRIGHT © 2015 OAKTON Engagement and experience expectations continue to change

COPYRIGHT © 2016 OAKTON Engagement expectations continue to change “Digital” touchpoints resonate with Consumers more and more everyday. By 2018 Digital Natives (Millennials) will begin to out-number all other types of Consumers. Millennials type consumers have been born into the digital world, not just adopting but driving innovation of new technologies to ‘enhance’ their lives. Decade of Change * % UK Active Adult population

COPYRIGHT © 2016 OAKTON Transformational Government and citizen-focus

8 COPYRIGHT © 2015 OAKTON Government is increasingly seeking digital solutions to service delivery: Customer self-service / e-portals / MyGov e-Tax, e-Health Grants Management Customer Relationship Management Systems Tender and Contract registers ACT – Access Canberra – web and payment solutions Express Plus – mobile apps TRANSFORMING TO CUSTOMER FOCUS

9 COPYRIGHT © 2015 OAKTON The potential of the data we generate and store creates substantial motive and opportunity

10 COPYRIGHT © 2015 OAKTON Findings indicate that the typical fraudster is: 36 to 45 years of age generally acting against his/her own organisation employed in an executive, finance, operations or sales/marketing function holds a senior management position employed in the organisation in excess of six years frequently acted in concert with others Source: KPMG Global profiles of the fraudster PERPETRATORS OF FRAUD

11 COPYRIGHT © 2015 OAKTON Data theft and ransom demands Attacks on payment systems / websites Theft of intellectual property Government credit card fraud Employee identify theft Fake credentials Fake company and invoicing TECHNOLOGY ENABLED FRAUD

12 COPYRIGHT © 2015 OAKTON TECHNOLOGY ENABLED FRAUD CHRISTOPHER PUSCHAK

13 COPYRIGHT © 2015 OAKTON TECHNOLOGY ENABLED FRAUD Has unethical behaviour tarnished the Volkswagen brand forever? CPA Update, Edition 41 28OCT15

14 COPYRIGHT © 2015 OAKTON Public servant who lied about stillbirth to skydive with government money sentenced to weekend detention A Canberra woman who used her government credit card to take a lavish holiday on the Gold Coast has been sentenced in the ACT Magistrates Court. ABC News, 30 Oct 2015 Four people charged for alleged fraud from ACT Public Trustee The suspect transactions took place over seven years and are believed to include debit card fraud, thefts from cash machines, contractor kickbacks, and false paperwork trails. ABC News, 16 Oct 2015 OTHER CASES

15 COPYRIGHT © 2015 OAKTON CALL TO ACTION

16 COPYRIGHT © 2015 OAKTON Declarations of Interest and due diligence Restrict data storage devices (USB, disk, Bluetooth) Access monitoring Behaviour monitoring Secure database, cloud and communications Data analytics / Computer Assisted Audit Tools (CAATS) Listen to customer complaints / concerns -> whistleblower line Audit practices – financial & compliance, use of CAATS Tone at the top – strong statement on fraud prevention PREVENTION IS BETTER THAN DETECTION

THANK YOU © Oakton Services Pty Ltd This work is copyright. Except as permitted under the Copyright Act 1968 (Cth), no part of this publication may be reproduced by any process, electronic or otherwise, without the specific written permission of the copyright owner. Neither may information be stored electronically in any form whatsoever without such permission. This presentation is intended to provide a summary of the subject matter covered. The Owner disclaims all liability in relation to the contents of this presentation and the use to which it may be put. Trademarks used in this document are the property of the owner.