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ISO certification for Fraud Control Management Systems helps with fraud prevention for enhanced governance, compliance, and risk management.
In brief
- ISO 37003 is a comprehensive framework providing guidance to organisations to develop, implement and maintain a fraud control management system
- It emphasises the full lifecycle of fraud risk by way of a four-pillar operational model —prevention, detection, response and continual improvement
The International Organization for Standardization (ISO) published ISO 37003 in May 2025. It is the first globally recognized standard that offers comprehensive guidance to build a fraud prevention framework. Developed with the assistance of ISO Technical Committee 309 (Governance of Organizations), it is not a certifiable standard but serves as best practices framework, providing guidance to organizations to establish, implement, and maintain effective fraud control systems.
The framework
ISO 37003 standard aligns with existing ISO management system standards like ISO 37001 (Anti-Bribery), ISO 37301 (Compliance), and ISO 31000 (Risk Management). This standard outlines key principles and requirements for establishing an effective Fraud Control Management System and emphasizes the importance of the commitment from leadership, implementation of fraud detection techniques, risk assessment, and the establishment of clear policies and procedures through:
- Leadership which plays a crucial role in fostering a culture of compliance and ethical behaviour within the organization. By demonstrating a commitment to fraud risk management, leaders can set the tone for the entire organization
- Periodic organizational risk assessments are another critical component that can help organizations identify and manage potential fraud risks specific to their operations and implement targeted controls and measures to mitigate identified risks
- Need for training and awareness programs because employees at all levels should be educated about ethical business practices, the risks of fraud and the organization’s policies and procedures for reporting suspicious activities
- Establishment of reporting mechanisms in organizations that would create channels for employees and stakeholders to report suspected fraudulent activities confidentially
Benefits of implementing ISO 37003
Fraud is a pervasive issue that can have devastating effects on organizations, including financial losses, reputational damage, and legal consequences. Building a robust Fraud Control Management System with clearly defined compliance standards is essential for organizations of all sizes and sectors. ISO compliance guidelines like ISO 37003 offer a structured approach to managing fraud risk by implementing risk assessment strategies, allowing organizations to inculcate sound corporate governance practices create a culture of integrity and transparency. Adopting the principles and practices outlined in ISO 37003 can deliver significant value:
- Strengthened risk posture for enhanced prevention and detection of fraud
- Cultural transformation by promoting an integrity-driven, ethical workplace
- Operational resilience through faster and more effective response to fraud incidents
- Stakeholder confidence built by commitment to transparency and governance
- Regulatory readiness through better alignment with legal expectations and due diligence norms
Whether an organization already has anti-fraud measures in place or is currently developing its program from the ground up, ISO 37003 provides a robust foundation to their efforts. ISO 37003 is relevant to public and private sector organisations for both multinationals as well as SMEs. NGOs and non-profits, Board and senior leadership teams, as well as Internal Audit, risk, compliance, and legal functions can benefit from it.
Summary
In an increasingly dynamic business environment, fraud schemes are evolving in complexity and scale. ISO 37003 offers a timely and valuable guide for organizations seeking to build or strengthen their fraud control frameworks. It shifts the conversation from reacting in response to fraud to achieving proactive fraud resilience.
Organizations that invest in fraud risk management through the lens of ISO 37003 stand to gain operational advantages along with building long-term trust-based relationship with their stakeholders. This standard is both a strategic asset and a moral compass.
How EY can help
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EY Virtual Ethics & Compliance Manager leverages tech-enabled services to manage investigations, ethics programs & regulatory compliance cost-effectively.
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EY Document Anomaly & Transaction Analytics uses advanced algorithms & multi-level document checks for accurate document verification & fraud detection.
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Trusted Verification at EY supports organizations BGV process with employee background verification and screening services for informed hiring decisions.
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