Antifraud professionals logically conclude that small organizations are particularly vulnerable to occupational fraud and abuse. The results from fraud surveys bear this out: losses in the smallest companies were comparable to or greater than those in organizations with the largest number of employees. It is suspected that this phenomenon exists for two reasons.

Smaller businesses employ more people with a wheeler$-$dealer mindset and don't solicit competitive bids as frequently.

Smaller businesses are more mission driven by nature and less inclined to formally orient new employees to their responsibilities.

Smaller businesses have fewer divilons of responsibility and there is a greater degree of trust where people know one another personally.

Smaller businesses employ fewer highly trained business managers and employees are less supervisgd