Reported by Ron Piccolo, Galloway Professor of Management and associate dean for strategic initiatives in UCF’s College of Business

Last week was International Fraud Awareness Week, which is dedicated to highlighting the prevalence and impact of fraud in all its terrible forms. Unfortunately, we do not have to look far to see flagrant examples of corruption, misappropriation, identity theft, insider trading, money laundering, counterfeiting and market manipulation.

Protecting against fraud is a foundational part of UCF’s new MBA program with an emphasis on risk management and insurance. Offered in Daytona Beach, the epicenter of Florida’s insurance industry, this graduate program will combine 10 advanced business courses with three electives focused on data analytics, risk management and insurance. Beginning Fall 2024, students will learn to identify various types of risk; analyze, interpret and evaluate insurance policies; and conduct in-depth business analysis of various industries and competitors.

In 2023, there have been egregious cases of fraud in healthcare, finance, real estate and insurance — highlighting the critical need for UCF’s new program. The Department of Justice, for example, recently announced results of a two-week blitz to crack down on illegal prescriptions, inflated Medicare reimbursements and fraudulent health insurance claims. The disruption of a nationally coordinated deceptive scheme resulted in 78 defendants facing federal and state charges in 16 states; 90 Medicare and Medicaid revocations; seizures of millions of dollars in cash, vehicles and real estate; and nearly $2.5 billion in total fraud.

Remember the rush by federal, state and local governments to provide financial subsidies to small companies during the height of the COVID-19 pandemic? Well as it turns out, hundreds of billions of dollars were misplaced or stolen in what has been described as “the largest fraud in U.S. history.” It should be no surprise that millions of borrowers misrepresented their financial needs, inflated the numbers of employees in their businesses, or created new companies out of thin air.

Some form of fraud seems to be ever present — in every industry, every organization, every “news” report and in nearly every complex transaction. The costs of fraudulent activity are immense. Whether it’s theft of property or other physical assets, manipulation of financial records, embezzlement by employees or lying to customers, the effects of fraud on the bottom line are both immediate and long-lasting.

The Association of Certified Fraud Examiners report that U.S. businesses lose an average of 5% of their gross revenues each year to some form of fraud. Forty-three percent of businesses with more than 100 employees are affected by corruption or fraudulent activity.

Read full report: https://www.ucf.edu/news/increasing-and-widespread-fraud-highlight-need-for-new-ucf-mba-program/