Internal Controls and Corporate Fraud in MENA
Corporate fraud in the Middle East has become a serious issue. A new study by Mubarak Al Ketbi (MAK) Auditing shows that weak controls remain the main reason why fraud happens inside companies. The report explains that fraud is not limited to small teams but often involves trusted employees between the ages of 36 and 55.
Fraud cases affect operations, finance, procurement, and even senior offices. Most incidents involve groups of two to five people working together. The common fraud type is misappropriation of assets such as embezzlement or false procurement.
Why Internal Controls Matter
Strong internal controls protect both small and large organizations. Without these measures, fraud can grow quietly for years. Businesses in UAE and across the region face rising risks because of:
- Rapid growth in economy
- High adoption of technology
- Increased personal wealth
When companies use strong controls, they reduce opportunities for collusion. At the same time, monitoring systems help detect fraud in real time.
Role of Whistleblowers and Detection
The study showed that 45% of fraud cases are detected through whistleblowers or informal tips. This highlights the importance of a “speak-up” culture. Employees must feel safe to report suspicious actions.
- Anonymous hotlines increase trust.
- Open reporting channels reduce fear.
- Regular fraud awareness training helps staff act quickly.
Fraud prevention is not just about technology. It’s about trust, ethics, and safe systems inside every business.
Collaboration Among Fraudsters
Around 55% of fraud cases involve collaboration. Usually, groups of two to five people plan and carry out fraud. In most cases, the amount is below USD 200,000, but it still damages companies.
Even when technology grows, fraudsters often rely on traditional tricks. This proves that old-fashioned checks like reconciliation and approval systems still matter. Technology helps detect fraud faster, but strong internal rules remain key.
Technology and Fraud Prevention
Although fraud is often carried out with simple methods, modern businesses can’t ignore digital risks. Cybercrime laws in the UAE and Saudi Arabia continue to improve, but companies must:
- Invest in cybersecurity
- Train employees on cyber risks
- Use real-time fraud detection software
- Protect financial data with advanced systems
When businesses combine old controls with modern technology, they create stronger protection.
Support from UAE Authorities
The UAE Ministry of Economy works with both local and federal partners to strengthen anti-fraud rules. The Financial Action Task Force (FATF) also removed the UAE from its “grey list,” which proves the country is serious about anti-money laundering efforts.
Such steps help the UAE remain a global hub for commerce and innovation. They also show the importance of public and private sector collaboration in building financial trust.
Lessons for Businesses
The report by Mubarak Al Ketbi (MAK) Auditing gives clear advice for businesses across MENA:
- Focus on ethics and employee awareness.
- Improve monitoring across departments.
- Review fraud strategies regularly.
- Support whistleblowing with strong policies.
- Combine internal controls with technology.
By doing these things, organizations can reduce fraud risk and build trust with investors.
Final Takeaway
Corporate fraud in MENA is growing, but companies can defend themselves with proper systems. Strong internal controls, ethical culture, and whistleblowing programs build trust and protect finances. As the saying goes, “An ounce of prevention is worth a pound of cure.” By acting early, firms save themselves from heavy losses and protect their reputation.
What Can Help – Mubarak Al Ketbi (MAK) Auditing
Mubarak Al Ketbi (MAK) Auditing offers advanced fraud detection, forensic audits, and compliance services for businesses in UAE. Our experts guide firms in building safe financial systems.
- For more information visit our office:
Saraya Avenue Building – Office M-06, Block/A, Al Garhoud – Dubai – United Arab Emirates - Or contact/WhatsApp us: +971 50 276 2132
