Whistle-blowing not used often by corporates for fraud prevention: Study

LUCKNOW: Whistle blowing mechanism as a tool for fraud risk management is not used much by Indian corporates and in its absence most employees use informal channels to report any unusual incident as a last resort, an Assocham-Ernst & Young report has pointed out. 

"Most frauds result in some form of business disruption as well as reputational and financial losses. Whistle blowing is still at a nascent stage in India, and most Indian companies do not use it as an effective tool against fraud," the report said. 

It said an effective whistle-blowing mechanism comprises an independent review conducted by an audit committee.