VIDEO. ZF Digital Summit 2022. Gabriel Zgunea, CEO, Corporate... Intelligence Agency: In Romania, the most common type of fraud is private corruption, which is found in all areas, especially in the area of procurement

VIDEO. ZF Digital Summit 2022. Gabriel Zgunea, CEO, Corporate Intelligence Agency: in Romania, the most common type of fraud is private corruption, which is found in all areas, especially in the area of procurement
5-6 minutes

Author: Alexandra Cepăreanu 29.01.2023

♦ "I do not believe that digitization will lead to the elimination of the human factor in investigations".

Digitization and digital transformation will not eliminate the human factor from fraud investigations within companies, Gabriel Zgunea, CEO of the Corporate Intelligence Agency, which deals with identifying and documenting fraud in companies, told the ZF Digital Summit 2022 event, which took place last November.

"I don't think that digitalization will lead to the elimination of the human factor in investigations because they still need to be analyzed by a human factor", said Gabriel Zgunea.

Also, in Romania, the most common type of fraud is private corruption, which is encountered in all areas, in second place is the theft of goods and money from the company, and in third place is large-scale fraud, said Gabriel Zgunea.

"In Romania, the most common type of fraud is that of private corruption, which is encountered in all areas, especially in the area of procurement of any kind, but not only. The second most common type of fraud is the theft of goods and money from the company. The third type of fraud is large scale fraud, which happens most often in logistics, warehousing or manufacturing activities. Here, because of the opportunities, almost everyone takes something home," said Gabriel Zgunea.

He explained that there are three elements behind fraud within a company: financial pressure or the desire to get rich quick, justification and opportunity.

"The first step in committing fraud is pressure, the second step is rationalization, when the company employee begins to feel that it's worth it and there's no problem doing that. Maybe he has been underpaid and feels he deserves more or simply has that pressure and needs the money."

"The third element of the fraud triangle is opportunity. Opportunity is the only element that can be controlled by the employer and the company. If there is no opportunity, there is no pressure and rationalization from the employee."

Currently, the companies active on the Romanian market that use the services offered by Corporate Intelligence Agency are large in size, so that the small and medium-sized segment is "exposed" to fraud.

"The companies using our services are corporations, not entrepreneurial companies. We are talking about investment funds, big players in retail, IT&C, technology, oil and gas. Almost all of our clients are in the top 10 or 15 in their industries."

Gabriel Zgunea mentioned that one of the problems identified at national level is the fact that in Romania there is not necessarily a culture of fraud detection within companies.

"For example, in Romania, there is no verification, there is no culture of fraud, for various reasons. And this leads to the opportunity for fraud to take place within the company."

Business risk management company Corporate Intelligence Agency, founded in 2015, reported at the end of 2021, the last year for which public data is available, business of more than 2.2 million lei - up 26% compared to the previous year - and a net profit of more than 1.1 million lei - down by almost 8% compared to 2020.

What else Gabriel Zgunea said

Corporate Intelligence Agency was established in 2015 with the aim of providing intelligence services to the private sector, tailored to the private environment. Given that the market was and still is relatively in its infancy, growth has been significant, with turnover almost doubling year on year, except during the pandemic.

There is a very long discussion about what makes an employee commit fraud. In this industry there is a fraud triangle that shows us the following: for fraud to occur, first of all there must be pressure, motivation or inclination.