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Application of Blockchain technology to combat fraud

Application of Blockchain technology to combat fraud
 
 
Fraud is a difficult problem for organizations in particular and for countries in general, causing many serious consequences. However, this problem will be difficult to solve if the method of centralized data storage is still used. So what's the solution? Let's find out the solution of applying Blockchain technology to combat fraud.
 
Why does cheating happen?
 
The lack of internal monitoring combined with the high-pressure work environment provides ideal conditions for organizational fraud to take place. A survey by PwC, a global auditor, found 52% of reported fraud cases were committed by internal actors, 24% of whom were senior management.
 
According to the 2018 PwC Global Economic Crime and Fraud Survey - which collected data from 7,200 respondents across 123 different territories - using the blockchain-enhanced system to exchange information could help reduce risks and costs to the reputation of top managers who commit fraud. Currently, organizations address fraud by establishing a code of conduct, engaging with external auditors and providing authority to internal audit teams.
 
According to ACFE's report, the use of data monitoring tools and analysis also contributes to loss reduction and faster detection of fraud cases. However, the ACFE report also cited the most common initial fraud detection method not based on technology, but through employee tips and whistle blowing, accounting for 40% of the cases. In 2018, companies worldwide lost more than $ 7 billion due to fraudulent activities. This data was analyzed on 2,600 cases from companies in 125 territories and 23 industries. This has posed new challenges for all organizations.  
 
 
Application of Blockchain technology to combat fraud
 
Blockchain is considered as the most potential technology today to combat fraudulent activities. The essence of blockchain technology is a shared and anti-tampering record of activities that are timed and verified by a distributed network of computers. This provides evidence to help check the information stored and exchanged. Therefore, when there is any fraud recorded on Blockchain, we can verify it easily.
 
Especially since the advent of digital currencies, almost no fraudulent activity has been detected on the Blockchain network. Money sent from one digital wallet to another cannot exceed the amount stated in the sender's wallet.
 
As a result, it is difficult for employees working in digital currency trading institutions to forge payment records, thereby preventing many acts of property appropriation such as theft of property. For organizations that have not made payments in digital currencies (majority, currently), they can still take advantage of blockchain technology to limit fraud. Such as financial statements, excel spreadsheets or any other sensitive digital files that are easy to tamper with - created, edited, stored, exchanged or canceled, those operations can be automatically posted. enter on the blockchain.
 
The process of recording these transactions on public block chains such as bitcoin or Ethereum is called anchoring, whereby only the reference or coding code is involved in a specific activity (e.g., email exchange) or The file (e.g. passport scan) is played as part of the blockchain transaction.
 
Because the data is stored on the public Blockchain network, anyone can view the transaction, or in some cases, you can grant access to or view the original files to check, such as checking. External mathematicians or regulators Although not widely applied, but with great potential, in the future, Blockchain technology will become an effective solution to prevent fraud. and asses. Let's join Blockchain to build a clean, fair and civilized society.
 
 

Contact information

EG VIET NAM TRADING SERVICES COMPANY LIMITED

 Address: 22 Quach Vu Street, Hiep Tan Ward, Tân Phu Distrist, HCM City

 Phone: (+84)86 705 74 79

 Hotline:  (+84)86 707 74 79

 Email: info@egvietnam.com

 

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