Fraud in non-profit organizations

Non-profit organisations not only provide essential services to the public, but they also form a sizeable portion of the global economy. Whether a non-profit’s mission involves supporting community and business development, health care services, religious activities, research and educational opportunities, or a host of other services, the work often requires substantial funding and a team of directors, employees, and volunteers. While the mission-above-profit aspect of these organisations might lull one into thinking that fraud is less of a problem than it is in the for-profit sector, non-profits actually face many unique fraud risks. Perhaps the biggest problem is that non-profits tend to have fewer fraud prevention controls than their for-profit counterparts—whether due to lack of awareness or an unwillingness to spend funds on this area. Additionally, it is a common perception that crimes against non-profits that receive public funds, tax benefits, or donations are essentially crimes against the public. As a result, fraud involving non-profits tends to receive increased media attention, which can also lead to decreased financial support.