Embezzlement doesn’t discriminate but it does have preferences.

Some industries get hit far more often than others, and the reasons why aren’t random. They come down to predictable structural factors: the volume of transactions, the quality of oversight, the level of trust placed in key employees, and the maturity of internal controls. Understanding which industries are most targeted by embezzlement and what makes them vulnerable gives any business owner or compliance officer a significant advantage in protecting their organization.

The data tells a clear story. The ACFE’s Occupational Fraud 2024: A Report to the Nations analyzed 1,921 real fraud cases across 138 countries and 22 industry categories, revealing both the sectors hit most frequently and the ones that suffer the largest losses per incident. The total losses across those cases exceeded $3.1 billion and that’s only what was investigated and reported. The ACFE estimates that organizations globally lose 5% of annual revenue to fraud, the vast majority of which goes undetected.

Here’s what the data shows about which industries are targeted by embezzlement most and why.

Banking and Financial Services: Volume Creates Vulnerability

It’s perhaps unsurprising that banking and financial services leads all industries in reported fraud cases 305 cases in the ACFE’s 2024 study, more than any other sector. The median loss per case was $120,000.

The financial services sector processes an enormous volume of transactions daily. That volume, combined with the complexity of financial instruments and the broad access many employees hold, creates constant opportunity. Billing fraud, check and payment tampering, and corruption are consistently the most prevalent schemes in this sector.

What often gets overlooked is that the same organizations trusted to protect consumer assets can have significant internal control gaps particularly in smaller community banks, credit unions, and regional financial institutions where one or two employees may handle functions that larger institutions segregate across entire departments.

The irony: financial services organizations are often more vigilant about external fraud than they are about the employee sitting at the desk down the hall. Understanding the difference between internal and external fraud is critical to closing that gap.

Manufacturing: High Losses, Diverse Schemes

Manufacturing ranked second in case volume with 175 cases, but its median loss of $267,000 puts it well above banking. The ACFE specifically identifies manufacturing organizations as particularly vulnerable to corruption, theft of noncash assets, and billing schemes.

Why manufacturing? A few structural reasons stand out. First, supply chains are complex and involve high volumes of vendor relationships each one a potential vector for overbilling, fake invoices, or kickback arrangements. Second, physical assets (raw materials, equipment, finished inventory) are abundant and frequently move in and out of facilities in ways that are difficult to monitor without robust controls. Third, purchasing authority in manufacturing is often delegated widely across plant managers and operations personnel, creating decentralized financial exposure.

Vendor fraud through fake invoices is especially common in manufacturing, where procurement teams manage hundreds of supplier relationships and approval thresholds can be set high enough to process fraudulent payments without triggering review.

Government and Public Administration: Oversight Gaps at Scale

Government entities accounted for 171 cases in the 2024 ACFE study, with a median loss of $200,000. The schemes most common in public sector fraud billing fraud, corruption, and payroll manipulation align predictably with how government operations work.

Public agencies often operate under bureaucratic structures where accountability is diffuse. A single department may manage significant budget allocations without meaningful independent review. Procurement processes always a high risk area can involve bid manipulation, contractor favoritism, or shell company fraud that persists for years before detection.

The shell company schemes used by government contractors represent one of the most sophisticated embezzlement vectors in this sector. A trusted employee with procurement authority and minimal oversight can route payments to entities they control, often disguising the scheme as legitimate subcontracting or consulting.

Payroll fraud through ghost workers and manipulated timesheets also appears disproportionately in government settings, where headcount is large and HR oversight may not be tightly integrated with payroll processing.

Healthcare: Fraud Inside and Out

Healthcare generated 117 cases in the 2024 ACFE study but the sector’s fraud problem is significantly broader than internal embezzlement alone. When you combine occupational fraud with external billing fraud, insurance fraud, and healthcare specific schemes, healthcare consistently ranks among the most fraud affected sectors in the U.S. economy.

Internal healthcare embezzlement often exploits the trust patients and administrators place in clinical and billing staff. A medical billing coordinator with unchecked access to the billing system can skim payments, manipulate reimbursement claims, or redirect funds for months or years before anyone notices. The complexity of healthcare billing with multiple payers, codes, and reimbursement pathways provides natural cover for manipulated transactions.

On the external side, ghost patients and services billed but never rendered represent a separate but related fraud category that has cost Medicare and Medicaid billions annually. Organizations operating across both internal and external risk vectors need layered controls at every level.

If you’re in healthcare or advising healthcare organizations, our deep dive on how healthcare fraud investigations actually work provides essential context.

Nonprofits: Mission Focused, Control Deficient

Nonprofits show up in about 10% of all occupational fraud cases a share that looks modest until you consider that nonprofits typically have far fewer employees and resources than the for profit and government organizations they’re counted alongside. The median loss per case is $76,000, but the reputational and operational damage frequently far exceeds that figure.

The reason nonprofits are consistently among the industries targeted by embezzlement is structural: they tend to operate with lean teams, heavy reliance on volunteer oversight, mission first cultures that de prioritize financial controls, and donor relationships that depend on trust. All of these factors create conditions where fraud can run longer before detection.

The ACFE’s 2024 findings are especially stark on one point: nonprofits have the lowest implementation rate of fraud awareness training of any sector studied. Organizations without fraud awareness training lose nearly twice as much as those with it, and take more than twice as long to detect fraud when it does occur.

Skimming intercepting cash or payment before it’s recorded is a particularly common scheme in nonprofits because many rely on in person donation collection, membership fees, and event revenue where cash handling controls are minimal. Adding basic controls around cash handling, bank reconciliation, and dual authorization for disbursements addresses the majority of these risks without requiring significant investment.

Mining, Wholesale Trade, and Construction: Highest Loss Per Case

If case volume makes banking and manufacturing look like the top targets, loss per case tells a different story. The industries with the highest median losses per fraud incident in the 2024 ACFE data are mining ($550,000), wholesale trade ($361,000), and construction ($250,000) none of which lead in case count.

What makes these sectors so costly when fraud does occur? Each involves high value transactions, complex supply chains, and operations that can be geographically dispersed and difficult to monitor centrally. In construction and mining, project based accounting creates natural opportunities to obscure theft in cost overruns, change orders, and equipment billing. In wholesale trade, the volume and value of goods moving through the distribution chain makes inventory based fraud and overbilling schemes particularly difficult to detect.

The pattern is consistent: the industries targeted by embezzlement most severely are those where high transaction values meet limited oversight and where a trusted employee with financial access can exploit that combination for extended periods. The ACFE found that fraud persists for a median of 12 months before detection, with median losses growing every additional month it goes undetected.

Understanding how long embezzlement can go undetected and what evidence investigators actually look for are foundational to building detection systems that work before losses compound.

What Every Industry Has in Common

Across all of the industries targeted by embezzlement most frequently, the ACFE consistently identifies the same underlying vulnerabilities: lack of internal controls (32% of cases) and override of existing controls (19%). That means more than half of all fraud cases trace back to control failures that were either never established or actively circumvented.

The practical implication: industry matters less than control quality. A well controlled nonprofit is safer than a poorly controlled bank. The sector creates the backdrop; the controls determine the outcome.

Whether your organization is in financial services, healthcare, manufacturing, or any other field, the core fraud prevention toolkit is the same segregation of duties, dual authorization for significant transactions, regular reconciliation reviews, and a confidential reporting mechanism. Our guide to building an anti fraud policy that actually stops employee theft walks through implementation for organizations of any size.

If you’re not sure where your organization stands on fraud risk, understanding what a fraud investigation costs relative to what prevention costs is usually the most effective way to make the case for investing in controls before something goes wrong.

Frequently Asked Questions

1. Which industry loses the most money to embezzlement per case? According to the ACFE’s 2024 data, the mining sector reports the highest median loss per fraud case at $550,000, followed by wholesale trade at $361,000 and manufacturing at $267,000. These figures reflect the high transaction values and complex supply chains common in these industries, where a single fraud scheme can run for months before detection.

2. Why is banking and financial services the most commonly reported sector for fraud? The sheer volume of transactions, breadth of employee access, and complexity of financial products create constant opportunity in this sector. Fraud in banking is also more likely to be formally investigated and reported than in smaller industries, which inflates its share of documented cases. Smaller community banks and credit unions often have the same exposure as large institutions but fewer dedicated anti fraud resources.

3. Are small businesses more vulnerable to embezzlement than large organizations? In relative terms, yes. Small businesses typically lack the formal controls, audit functions, and segregated roles that larger organizations have. The ACFE consistently finds that smaller organizations suffer the largest median losses relative to their size, and that fraud persists longer before detection in organizations with fewer employees. Our post on why small businesses are more vulnerable to embezzlement covers this in depth.

4. Why are nonprofits particularly at risk for embezzlement? Nonprofits often operate with lean staffing, volunteer oversight, and mission focused cultures that deprioritize financial controls. The ACFE’s 2024 report found that nonprofits have the lowest fraud awareness training rates of any sector studied and organizations without such training lose nearly double what trained organizations lose when fraud occurs.

5. How does embezzlement typically get detected in high risk industries? Across all industries, tips account for 43% of all fraud detections, making them more than three times more effective than any other method. Internal audits detect 14% of cases and management reviews catch 13%. This is why building a confidential reporting channel before you believe you need one is one of the highest return fraud prevention investments any organization can make.

6. What’s the first step an organization should take if they suspect embezzlement? Do not confront the suspected employee until records are secured and legal counsel is engaged. Immediately preserve financial records in their current state, restrict the suspect’s system access if possible without alerting them, and consult an attorney and forensic accountant before taking further action. The sequence matters: premature confrontation can destroy evidence and create legal exposure for the business. Our detailed guide on what to do when you suspect employee theft walks through every step.

References

1. Association of Certified Fraud Examiners (ACFE). (2024). Occupational Fraud 2024: A Report to the Nations. https://www.acfe.com/ /media/files/acfe/pdfs/rttn/2024/2024 report to the nations.pdf
2. Lux Analysis, LLC. (2025). Industry Insights on Occupational Fraud: Key Findings from the 2024 ACFE Report to the Nations. https://www.luxanalysis.com/blog/2025/3/3/industry insights on occupational fraud key findings from the 2024 acfe report to the nations
3. Anchin CPAs & Advisors. (2024). 2024 ACFE Occupational Fraud Report. https://www.anchin.com/wp content/uploads/2024/08/2024 ACFE Occupational Fraud Report.pdf
4. Ahuja & Consultants, Inc. (2025). Key Points of ACFE’s Occupational Fraud 2024: A Report to the Nations. https://ahuja consultants.com/key points of acfe report occupational fraud 2024/
5. Selden Fox CPAs. (2024). 2024 ACFE Report on Occupational Fraud. https://www.seldenfox.com/our insights/articles/2024 acfe report occupational fraud/
6. PBMares LLP. (2025). Fraud Risks in Nonprofits: Trends and Strategies for 2025. https://www.pbmares.com/fraud risks in nonprofits trends and strategies for 2025/
7. BoardEffect. (2024). Nonprofit Embezzlement Cases: Examples to Learn From. https://www.boardeffect.com/blog/nonprofit embezzlement cases/
8. MJ CPA. (2024). Nonprofits Don’t Lose As Much To Fraud, But Risk Requires Action. https://www.mjcpa.com/nonprofits dont lose as much to fraud but risk requires action/
9. Farella Braun + Martel / BDO USA. (2025). Fraud Risks in Nonprofit Organizations: Learning From Real Life Case Studies. https://www.fbm.com/publications/fraud risks in nonprofit organizations learning from real life case studies/
10. Federal Bureau of Investigation (FBI). (2024). Financial Crimes   White Collar Crime Overview. https://www.fbi.gov/investigate/white collar crime
    

Disclaimer: This article is provided for informational and educational purposes only. It does not constitute legal, financial, or professional advice of any kind, and no professional or client relationship is created by reading it. Fraud risks, industry conditions, and legal requirements vary by jurisdiction and organization type. Consult a qualified certified fraud examiner, attorney, or compliance professional for guidance specific to your situation. For questions about FraudOrder services, visit https://fraudorder.co/