Even recession-proof companies need strong compliance controls

February 17, 2023
investigations and compliance

During an economic downturn, less attention is generally paid to fraud in recession-proof industries such as freight and logistics companies, discount retailers, and the healthcare industry.  Companies that expand rapidly following a sharp increase in demand might lack effective systems to prevent or detect fraud, as the focus shifts from compliance to increased revenue targets.

Companies under pressure to meet rising demand might also ignore signs of trouble, allowing fraudsters to evade detection for extended periods of time.

Unlike the recession in 2008, the COVID-19 pandemic brought additional challenges as companies pivoted to remote work models. Burnout, management changes, staff shortages and emerging technology prone to criminal misuse amplified the risk of internal and external fraud.

In this Law360 article, Daniel Castleman, Samantha Salkin, and Emily Butler discuss the risks, challenges, and ways to monitor fraud and develop stronger compliance programs to help combat fraud in these industries.