Earlier today, the FBI informed Congress that the stimulus and bailout will increase fraud, as reported by Reuters in “Stimulus, Bailout Will Lead to More Fraud: FBI“. FBI Director Robert Mueller said “Our expectation is that economic crimes will continue to skyrocket.”

“The agency’s caseload will only increase as federal dollars flow from the $787 billion economic stimulus package and several bank bailouts, he said.

“The unprecedented level of financial resources committed by the federal government to combat the economic downturn will lead to an inevitable increase in economic crime and public corruption cases,” Mueller said.”

In similar news, KPMG released a study last week about fraud and how to combat it. The KPMG National Leader of Forensics indicates that:

“The number one method to help bring fraud to light at an early stage is a robust upstream communication mechanism – in other words, an effective whistleblowing or ethics hotline. Nothing else is quite so powerful”.

The KPMG report indicates that to detect and prevent fraud, companies should institute an effective whistleblower hotline (such as those provided by Ethical Advocate), a robust and properly implemented code of business conduct, and a consistently applied and thorough system to prescreen new hires.