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Journal of Financial Crime
Number of Followers: 375  
  Hybrid Journal Hybrid journal (It can contain Open Access articles)
ISSN (Print) 1359-0790 - ISSN (Online) 1758-7239
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  • Editorial
    • Pages: 2 - 4
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 2-4, January 2019.

      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:25:14Z
      DOI: 10.1108/JFC-09-2018-0103
      Issue No: Vol. 26, No. 1 (2019)
  • Impediments affecting the curbing of illicit financial flows of organised
           crime in developing economies
    • Pages: 5 - 21
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 5-21, January 2019.
      Purpose The purpose of this paper is to examine the treats hindering war against illicit financial flows of organised crime in developing economies and Nigeria in particular. The examination shows that the impediments facing the fight against money laundering and organised crime financial flows vary from one country to another. It may be lesser in developed economies where most instruments, treaties and best practice recommendations to curb serious crime originated from. However, the impediments against the proceeds of organised crime in developing economies are overwhelming. Design/methodology/approach The research methodology adopted was qualitative analysis. This was applied through the use and analysis of documents and expert interviews. Findings The impediments jeopardising the success against organised crime and other related serious crime financial flows in developing economies are devastating. Consequently, the study offered some policy implications to help mitigate these impediments in developing countries. The dynamics and the phenomena of organised crime business model are operated with ingenious strategies within the global states. Therefore, staying in control of the menace and the threats originated from the organised criminal activities would require periodic review of the global initiatives, standards and strategies deployed by the standard setters to combat organised crime and its financial flows in developing and evolving economies. Additionally, the implementing countries should be carried along and allow to make inputs when such initiatives and standards are being developed. Social implications In Nigeria, there is a clear evidence of “collateral damage” in terms of social justice as result of financial exclusion of many bankable adults of the country that do not possess unique identities for account opening documentation and customer due diligence of the Financial Action Task Force recommendation 10. Originality/value There have been quite a number of studies on organised crime and still fewer have recognised the need to explore the success or failure of combating the proceeds of crime in developing economies. This study provides answer to these gaps by screening associated risks of fighting the proceeds of organised crime in developing countries and Nigeria in particular.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:21:31Z
      DOI: 10.1108/JFC-11-2017-0108
      Issue No: Vol. 26, No. 1 (2019)
  • Disentangling anti-corruption agencies and accounting for their
    • Pages: 22 - 35
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 22-35, January 2019.
      Purpose The purpose of this paper is to provide an adequate account of anti-corruption agency (ACA) ineffectiveness and propose the kind of ACA that would hold the promise of success. The paper draws on legitimacy theory, legal process and the notion of integrity of purpose. Design/methodology/approach This paper contextualizes the establishment and proliferation of ACAs; explores different ways of conceptualizing them; examines the broad range of factors that have underpinned ACA ineffectiveness and utilizes both legitimacy theory and the notion of the integrity of purpose. Findings The one-ACA-model-fits-all approach in corruption-control has been an abysmal failure. Disentangling the reasons for ACA ineffectiveness reveals various endogenous and exogenous factors. It also emphasizes the crucial importance of integrating both legitimacy theory and integrity of purpose in a revamped ACA concept that meets the corruption-control challenge. Practical implications It is possible to design and implement an effective ACA by avoiding various factors that have been shown to seriously undermine corruption control efforts by also drawing on legitimacy theory, legal process and integrity of purpose. Social implications Corruption in both the public and private sectors cannot be controlled in isolation from other socio-economic problems. An effective ACA is one that fosters integrity and is considered legitimate by its stakeholders. Originality/value While there have been some articles the past two decades discussing the effectiveness of ACAs in particular countries, this is the first paper to account for the overall ACA ineffectiveness also using legitimacy theory, legal process and integrity of purpose to revamp the ACA concept.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:22:06Z
      DOI: 10.1108/JFC-01-2018-0016
      Issue No: Vol. 26, No. 1 (2019)
  • Tax evasion in the media: a comparison of Southern vs Central and Northern
    • Pages: 36 - 49
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 36-49, January 2019.
      Purpose The representation of economic and financial crimes in the mass media can have a significant impact on readers’ and citizens’ perceptions of illegality and on a firm’s propensity to invest in different areas of the country in question. This paper aims to study the possible geographical media bias regarding tax evasion in Italy. Design/methodology/approach The empirical analysis considers 618 articles on tax evasion published between 2012 and 2016 in two top Italian newspapers, La Repubblica (based in Rome) and Il Corriere della Sera (based in Milan). Findings Excluding Insular Italy (Sicily and Sardinia), the articles on tax evasion in Southern Italy are systematically shorter. A further analysis shows that La Repubblica is largely responsible for this bias. This result holds after controlling for other events (bank robberies) and for the identity of journalists. Originality/value Previous studies considered the possible media bias regarding particularly dramatic criminal events, for example, terrorism acts or murders. This paper considers a less dramatic though more pervasive crime. In addition, an assessment of media attitude towards tax evasion is more complex, because the news reports both the crime and the successful actions that combat it.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:21:53Z
      DOI: 10.1108/JFC-12-2017-0124
      Issue No: Vol. 26, No. 1 (2019)
  • Cybercrime: an emerging threat to the banking sector of Pakistan
    • Pages: 50 - 60
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 50-60, January 2019.
      Purpose The purpose of this study is to gain more insight into the impact of cybercrime incidents in the banking sector of Pakistan. This study investigates the significant contribution of information security awareness on the relationship of cybercrimes and organizational performance. Design/methodology/approach The impact of cybercrime incidents on organizational performance is investigated by further exploring the moderating effects of information security awareness. A sample of 302 employees in the banking industry of Pakistan was studied by using survey design. Findings Cybercrime incidents have negative impact on organizational performance, but information security awareness weakens the negative impact of cybercrimes on organizational performance. Research limitations/implications The present study focuses on the banking sector so its finding cannot be generalized in other sectors. Further, in-depth comparative studies in other sectors with different cultural settings will help to authenticate the research findings. Practical implications Information security awareness weakens the negative impact of cybercrimes on organizational performance; therefore, it is important for banks’ HR managers to set up more security training courses to increase employees’ awareness on cybercrimes. Originality/value This study explores the impact of cybercrimes on banks’ performance with the moderating role of employees’ information security awareness. Linking these topics has created a new study within the cybercrimes discipline. The present study also enhances the understanding of employees’ role to combat the impact of cybercrimes on organizational performance.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:23:56Z
      DOI: 10.1108/JFC-11-2017-0118
      Issue No: Vol. 26, No. 1 (2019)
  • How modern psychology can help us understand white-collar criminals
    • Pages: 61 - 73
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 61-73, January 2019.
      Purpose This paper aims to add to the theoretical discussion of white-collar crime by introducing modern psychological decision-making literature and the potential effect on white-collar offending. Design/methodology/approach Using a theoretical approach, literature on heuristics, innovation and stress, insight into why white-collar offenders decide to commit crime is posited. Findings The heuristics and strategies that people use to assist in decision-making process may inadvertently promote white-collar crime. For example, stress may inhibit white-collar offenders’ thinking, causing them to discount the risk of committing said offense; individuals may not challenge the success of carrying out a white-collar offense once it is considered; and generally, people will be more optimistic in considering their success of not getting caught. Originality/value Currently, the study of white-collar crime is discussed largely in the context of sociological factors. Current psychological theories have considerable explanatory power in understanding why white-collar offenders commit their crimes.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:24:29Z
      DOI: 10.1108/JFC-11-2017-0103
      Issue No: Vol. 26, No. 1 (2019)
  • Christian attitudes toward ethics of tax evasion: a case study
    • Pages: 74 - 94
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 74-94, January 2019.
      Purpose The purpose of this study is to examine Christian views on the ethics of tax evasion. Design/methodology/approach To achieve this objective, data were gathered from the most recent World Values Survey, which included 60 countries. The sample size exceeded 30,000. Various demographic variables were also examined, such as gender, age, marital status, education level, income level, social class, position on the political spectrum and others. Findings This study found that although there was widespread opposition to tax evasion, it could be justified sometimes. Not all Christian sects had the same view of tax evasion. Some sects were less severe in their opposition than others. This study ranked the various sects from least to most opposed. Originality/value The present study expands the religions literature by showing that differing Christian sects have opinions on the ethics of tax evasion that differ significantly, and that it cannot be said categorically that the more conservative Christian sects are either more opposed or less opposed to tax evasion than are the liberal or moderate sects.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:25:32Z
      DOI: 10.1108/JFC-11-2017-0104
      Issue No: Vol. 26, No. 1 (2019)
  • Corporate fraud and information asymmetry in emerging markets
    • Pages: 95 - 112
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 95-112, January 2019.
      Purpose The purpose of this study is to examine changes in firms’ level of information asymmetry in emerging market of Malaysia for the period of 2000-2016. Specifically, the study focuses on changes in the quoted spread and quoted depth following the fraud announcement. Design/methodology/approach The study uses a unique set of fraud sample using enforcement action releases (EARs) identified from the Security Commission of Malaysia and Bursa Malaysia. To estimate the result, the authors use event study methodology, OLS regression and simultaneous model on a set of 67 fraudulent firms. Findings The results of event study, OLS regression and simultaneous equation models suggest that information asymmetry increases on fraud discovery. The authors also use the analysis on subsamples classified by the type of regulator (who issued the enforcement release) and type of fraud committed. However, the authors find no evidence of a difference in information asymmetry across these groups. Overall, the results support the reputational view of fraud that it damages the firms’ reputation and increases uncertainty in the capital market. Research limitations/implications These findings provide valuable insights into understanding the information asymmetry around fraud announcements, especially for Malaysia, where the majority of the public-listed companies are family-controlled and under significant state control. The results of this study call for the active role that regulators can play to achieve a transparent and liquid capital market. Practical implications The research has practical implications. Specifically, for Malaysia, fraud is the primary area for National Results Areas (NKRA) in the Government Transformation Program (GTP). Therefore, for regulators and policymakers to ensure a liquid and transparent capital market, identifying the factors that elicit the fraudulent behavior and improving the related governance mechanism are necessary steps to prevent the fraudulent practices. Social implications Due to increased information asymmetry on fraud announcements, the demand for equity decreases that may affect not only the fraudulent firms but also results in negative externality for non-fraudulent firms, thus impairing their ability to fund equity. Originality/value A significant majority of studies have focused on corporate frauds in developed countries such as the USA that is characterized by dispersed ownership system and a strong capital market. One of the vocal critics of the agency theory is that it neglects the social and institutional framework within which companies operate. In emerging markets, such as Malaysia, the published academic papers on fraud and information asymmetry are very limited. As emerging markets practice different cultures, corporate governance mechanisms and market regulations, the study is significant to investigate the behavior of investors in such markets.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:20:58Z
      DOI: 10.1108/JFC-11-2017-0107
      Issue No: Vol. 26, No. 1 (2019)
  • Factor analysis of financial crime-related issues
    • Pages: 113 - 130
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 113-130, January 2019.
      Purpose The purpose of this paper is to propose indices that were freely considered as relevant for the analysis of financial crime-related issues in Nigeria and list them in the questionnaire that was administered across the six geo-political zones of the country to obtain relevant data that are useful for factor analysis of financial crime-related issues. Design/methodology/approach The research methodology involved data survey, preparation and normalization. Followed by principal component analysis-based factor analysis and then, results and interpretation. Findings The results of factor analysis placed high premium on government policies and regulations, responses and management, capacity building and awareness and litigation as the major issues for safe and secure financial system in Nigeria. Findings from the research also established that systemic ways of ensuring that citizens adopt technical know-how for national development rather than committing crimes should be introduced and enforced by the Nigerian government. Originality/value The research formulated some indices and established some models for the analysis.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:25:48Z
      DOI: 10.1108/JFC-11-2017-0120
      Issue No: Vol. 26, No. 1 (2019)
  • Combating corruption in Nigeria: the emergence of whistleblowing policy
    • Pages: 131 - 145
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 131-145, January 2019.
      Purpose This paper aims to appraise the roles of whistleblowing policy as a tool for combating corruption in Nigeria. Methodologically, it examines how the policy could be strengthened to effectively address the challenges of corruption in Nigeria. Design/methodology/approach This paper is essentially a desk research with reliance on the secondary source of data. Relevant materials were collected in an eclectic manner from official documents, statutes and other published outlets such as books, journal publications, online articles, news reports and newspaper articles. Its scope is limited to issue and content analysis relating to the use of whistleblowing policy as a tool to combat corruption. Findings The paper finds that whistleblowing policy is an effective anti-corruption instrument that has facilitated discovery and recovery of looted public resources and prosecution of culprits in Nigeria. Originality/value This paper demonstrates how whistleblowing as an anti-corruption mechanism could be strengthened in Nigeria when the legislator finally passed the Whistleblower Protection Bill into law.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:22:39Z
      DOI: 10.1108/JFC-10-2017-0102
      Issue No: Vol. 26, No. 1 (2019)
  • Policing the illicit trade of tobacco in Australia
    • Pages: 146 - 161
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 146-161, January 2019.
      Purpose The purpose of this study is to identify factors that have led to the rebirthing of the illicit cultivation of tobacco in Australia known as chop-chop. Limited research has been conducted on the Commonwealth policing of tobacco-related criminal activity, but no prior studies have investigated domestic cultivation since the tobacco farming ceased legal production. Design/methodology/approach To fill the void of the literature, this study used data collected from Australian Government publications, court cases and newspapers to develop an understanding of the financial aspects and policing of the rebirth of chop-chop. Newspaper articles for a range of publications for a two-year period were used to examine policing efforts to disrupt criminals engaged in domestic cultivation of tobacco. Findings As tobacco was first legally grown in Australia, authorities have always faced the problems associated with the illicit cultivation of tobacco. Findings indicate that as a result of the increased number of successful interception of illicit tobacco at the border, the domestic cultivation of chop-chop is growing as criminal enterprises find alternative means to fund their activities. Originality/value The paper improves upon a neglected topic by offering a current contribution to a topic looking at the illicit tobacco, chop-chop trade.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:19:40Z
      DOI: 10.1108/JFC-12-2017-0121
      Issue No: Vol. 26, No. 1 (2019)
  • Mapping corruption in procurement
    • Pages: 162 - 178
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 162-178, January 2019.
      Purpose This paper aims to focus on understanding and preventing corruption in procurement in public sector settings. Just as not all corruption is the same, not all procurement is the same. One purpose is to analyze different types of procurements: standard, customized, intangible and complex. Corruption in procurement undermines public administration, and the purpose of this paper is to identify different types of procurements and provide readers with a framework for analysis and subsequent intervention. Design/methodology/approach In all, 42 actual cases of public sector corruption in procurement are examined, and from these, an analytical matrix is developed. These cases are derived from the reports of the New South Wales (Australia) Independent Commission against Corruption. These cases represent all of the procurement cases that the ICAC has taken to a formal hearing in its 30 years of existence. Findings While fraud is a major feature of corruption in procurement, there are significant organizational facilitators, and a number of slippage points in organizations are identified. These include peer culture, lack of due process, temptation and managerial incompetence/willful disregard, and these are built into a matrix which can be used in different countries or settings by readers wishing to understand and prevent different types of corruption in procurement in their agencies. Originality/value This paper uses cases that have not previously been aggregated or analyzed and provides analytical tools for practitioners and academics.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:26:50Z
      DOI: 10.1108/JFC-06-2018-0063
      Issue No: Vol. 26, No. 1 (2019)
  • Internal auditor’s compliance to code of ethics
    • Pages: 179 - 194
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 179-194, January 2019.
      Purpose The purpose of this study was to determine the professional competency levels acquired by internal auditors in detecting unethical behaviour, to evaluate the position of internal auditors on objectivity and integrity in dealing with unethical behaviour and to examine the extent of their awareness on ethical issues in government-linked companies (GLCs). Design/methodology/approach Data were collected via questionnaires that were randomly distributed to the internal auditors of the selected GLS in Malaysia. These questionnaires were constructed from the Certified Internal Auditor (CIA) Examination Paper and The Institute of Internal Auditors (IIA) Competency Framework. Findings This study found that internal auditors of the GLCs had a high level of competency in performing audit engagements and were able to detect unethical practices in the companies. The majority of the internal auditors also had a high level of objectivity and integrity when faced with unethical behaviour during audit engagements. Research limitations/implications This study provided strong evidence that the internal auditors of Malaysian GLCs strongly complied with IIA Code of Ethics. Besides, they were also aware of the unethical behaviour which occurred within their organizations. However, this study is limited to the internal auditors in GLCs, while the questions of the survey instrument are restricted to the elements of integrity, objectivity and professional competencies of internal auditors. Practical implications This study highlights the level of internal-auditor competency and adherence to the IIA’s International Standards for the Professional Practice of Internal Auditing (ISPPIA) and IIA’s Practice Guide to identify unethical behaviour within the Malaysian GLCs. Originality/value This study is original as it focusses on GLCs which did not get much attention from previous researchers, particularly the GLCs that operate in a developing country such as Malaysia.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:23:19Z
      DOI: 10.1108/JFC-07-2017-0066
      Issue No: Vol. 26, No. 1 (2019)
  • Role of government’s legal adviser in curbing corruption in Israel
    • Pages: 195 - 202
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 195-202, January 2019.
      Purpose The status of government’s legal adviser in Israel is complicated and controversial. This status deeply impacts discretion and independence, especially in the role of combating corruption. This article aims to review the status, power and independence of the government’s legal adviser and his/her interaction with other legal institutions dealing with corruption cases. Design/methodology/approach The author argues that the period of the 1980s, in Israel, was characterized by prosecution’s activism because of the dramatically increased number of corruption-related cases. Findings Prominent government legal advisers formulated approaches to the struggle against political corruption in Israel; upon becoming justices of the supreme court, they successfully transited their prosecution mindset to judicial activism (and not only for corruption-related cases). Originality/value This article discovers a linkage between prosecution and judicial positions, not under the Israeli legislation but based on personal willingness to combat corruption.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:20:41Z
      DOI: 10.1108/JFC-12-2017-0125
      Issue No: Vol. 26, No. 1 (2019)
  • Combatting public procurement criminality or simple rules for complex
    • Pages: 203 - 210
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 203-210, January 2019.
      Purpose Crimes that take place in the context of procurements, such as corruption and subsidy fraud, are a major problem for both integrity and fiscal accountability of public administration. Therefore, combatting such crimes is of great importance. However, this course of action works only if the prosecutors have the instruments designed for what is precisely needed for their fight. One of the things needed is elements of crimes that can be handled easily; and to show this is the purpose of this study. Design/methodology/approach The author’s practical experience as a state prosecutor dealing with corruption cases and enriched with philosophical thinking about the principles of law indicates that one thing is especially important with regard to the elements of crimes: simplicity. Findings Corruption and financial crime cases are quite often very complex, involving many participants and considerable effort by the perpetrators to disguise their real actions as normal business procedures. As a result, finding evidence is a difficult task. If the elements of crimes are complex and if they demand detailed evidence, then proving procurement criminality will be even more difficult as it already is and will quite frequently end up in failure. Therefore, giving prosecutors a simple legal framework with elements of crimes, demanding only what realistically can be proven is a key factor for success. Originality/value Only with such a simple legal framework can the prosecutor’s fight against procurement criminality bring urgent, positive results.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:22:24Z
      DOI: 10.1108/JFC-11-2017-0114
      Issue No: Vol. 26, No. 1 (2019)
  • Fraud in small charities: evidence from England and Wales
    • Pages: 211 - 222
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 211-222, January 2019.
      Purpose Despite the increasing awareness of fraud in organisations and the potential benefits of strong fraud management through deterrence and prevention in the UK, there remains limited research on fraud in small charities. This paper aims to examine astonishing cases of fraud in small charities whilst raising awareness of the impact of fraud and its wider implication in the charity sector. Design/methodology/approach This research used a qualitative approach amongst randomly selected 24 charity trustees with income of £0-250,000 and over £250,000. Recent statistics from fraud survey published in Annual Fraud Indicator by the National Fraud Authority and the United Kingdom Fraud Costs Measurement Committee were presented and the theory of why people commit fraud is described. Findings This paper summarises evidence that shows the frequency and severity of fraud in charities, which remains increasingly high. Furthermore, smaller charities are not immune from fraud and suffer losses due to lack of segregation of duties and weak control systems when compared to larger charities with stronger control systems and better governance structure. This paper addresses a very important topic in the charity sector. Whilst fraud and fund misappropriation receive significant media coverage in large charities, smaller charities also suffer losses occasioned by fraud even in large proportion albeit with less reporting in the media. Practical implications Charity managers and trustees will benefit from having sufficient knowledge in deterrence and prevention of charity fraud. Originality/value This is a novel research as it looks into the nature of fraud in small charities of which there is limited research both in the voluntary and fraud literature.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:20:03Z
      DOI: 10.1108/JFC-12-2017-0122
      Issue No: Vol. 26, No. 1 (2019)
  • Audit and risk committee in financial crime prevention
    • Pages: 223 - 234
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 223-234, January 2019.
      Purpose This empirical study aims to examine two areas: first, the characteristics of the audit committee and their relationship with corporate financial crime so as to ensure that their effectiveness as a corporate governance mechanism is still relevant; and second, the effectiveness of having a risk committee which is separated from the audit committee in the prevention of corporate financial crime. Design/methodology/approach This empirical research was carried out by using a Web-based data collection for corporate financial crime cases. Findings While the results for audit committee characteristics are not supported, the findings, however, indicate a significant relationship between the existence of a stand-alone risk committee with corporate financial crime incidences. Practical implications The result of the study serves as an empirical indicator of a firm’s consideration in deciding on the implementation of a stand-alone risk committee from its audit committee. Originality/value Both the descriptive and correlation analyses produced by this paper provide new insights into the extent of corporate financial crime, as well as the empirical evidence of the effectiveness of having a stand-alone risk committee.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:23:44Z
      DOI: 10.1108/JFC-11-2017-0116
      Issue No: Vol. 26, No. 1 (2019)
  • Transfer pricing, earnings management and tax avoidance of firms in Ghana
    • Pages: 235 - 259
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 235-259, January 2019.
      Purpose This paper aims to investigate how transfer pricing (TP) and earnings management affect tax avoidance of firms in Ghana. Design/methodology/approach The authors use a panel data set from 2008 to 2015 to further shed light on transfer pricing-tax avoidance nexus by examining the complex interaction of three key variables: transfer pricing, earnings management and tax avoidance. Findings The results show that almost all the sample firms have engaged in some form of transfer pricing strategies and the manipulation of earnings to avoid tax during 2008-2015. There is evidence to suggest that non-financial multinational corporations manipulate more earnings than the financial firms while financial firms also use more TP than non-financial firms. The overall results suggest that the sensitivity of tax avoidance to transfer pricing decreases as firms increase their earnings management. By extension, these results have important policy implication for policymakers in assessing the effectiveness of tax laws relating to transfer pricing. Originality/value The authors investigate how transfer pricing and earnings management affect the avoidance of firms operating in Ghana.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:26:28Z
      DOI: 10.1108/JFC-10-2017-0091
      Issue No: Vol. 26, No. 1 (2019)
  • To whistle or not to whistle' Determinants and consequences
    • Pages: 260 - 276
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 260-276, January 2019.
      Purpose Many corporate scandals that occurred recently have indicated the importance of a whistle-blowing mechanism in preventing fraud and malpractices from damaging the organizations. By selecting one organization that has experienced a corporate scandal, this study aims to examine factors that influence employee’s intention to blow the whistle to prevent malpractices in the company. In addition, this study also examines the perceptions of employees regarding the business culture in their organization and how this culture impacts their intention to whistle-blow. Design/methodology/approach This study engages in a mixed method of data collection, namely, survey questionnaire and interviews to gather the data. Findings It is found that retaliation is the most important factor that influences the employee’s intention to whistle-blow, followed by the burden to prove the malpractices, cost implications as a result of the wrongdoing and the action taken by the authority as a result of the fraud reporting. In terms of business culture, a large number of employees are reluctant to become a whistle-blower, although a secured and safe whistle-blowing mechanism is in place, indicating that Asian customs of collectivism and assertiveness play a major part in shaping the whistle-blowing mechanism in Malaysian organizations. Research limitations/implications The results provide further confirmation of the determinants that influence employees to report wrongdoings in the organizations. This study however may subject to self-reported data biasness because of sensitivity of the research that related to fraud and immoral behaviours that occur in the company. Owing to this sensitivity, the study only focuses on employees’ internal whistle-blowing intentions rather than their actual intentions. Practical implications This study helps the management to understand the working culture in the company so that they can identify the weak area of governance which needs improvement such as whistle-blower protection. Originality/value This study is original, as it focuses on the employees in a big organization such as government link companies that have experienced corporate scandals albeit having whistle-blowing mechanism in place. In addition, the finding of this study contributes to the theory and body of the literature on the whistle-blowing determinants, currently scarce in the context of a developing country like Malaysia.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:26:07Z
      DOI: 10.1108/JFC-10-2017-0090
      Issue No: Vol. 26, No. 1 (2019)
  • Predicting susceptibility to cyber-fraud victimhood
    • Pages: 277 - 292
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 277-292, January 2019.
      Purpose This paper aims to develop a theoretical framework to predict susceptibility to cyber-fraud victimhood. Design/methodology/approach A survey was constructed to examine whether personality, socio-demographic characteristics and online routine activities predicted one-off and repeat victimhood of cyber-fraud. Overall, 11,780 participants completed a survey (one-off victims, N = 728; repeat victims = 329). Findings The final saturated model revealed that psychological and socio-demographic characteristics and online routine activities should be considered when predicting victimhood. Consistent with the hypotheses, victims of cyber-frauds were more likely to be older, score high on impulsivity measures of urgency and sensation seeking, score high on addictive measures and engage in more frequent routine activities that place them at great risk of becoming scammed. There was little distinction between one-off and repeat victims of cyber-frauds. Originality/value This work uniquely combines psychological, socio-demographic and online behaviours to develop a comprehensive theoretical framework to predict susceptibility to cyber-frauds. Importantly, the work here challenges the current utility of government websites to protect users from becoming scammed and provides insights into methods that might be used to protect users from becoming scammed.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:26:56Z
      DOI: 10.1108/JFC-10-2017-0095
      Issue No: Vol. 26, No. 1 (2019)
  • A taxing assessment
    • Pages: 293 - 312
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 293-312, January 2019.
      Purpose The purpose of this paper is to enlighten the reader about the development in tax law. Moreover, the author intends to show that other measures could be implemented to supplement the existing machinery. Design/methodology/approach The paper explores the duty vested in the courts to probe the merits of transactions meant to evade or avoid the burden of tax. So much of the text is based on case law. The methodology is based on literature research rather interpersonal research. Findings The paper highlights that the current tax machinery has solved a number of tax issues. However, the machinery has not addressed the problem of fraud committed in the banking sector. The paper therefore recommends solutions to this problem. Research limitations/implications The paper was formulated before the current tax laws where implemented. The current law contains the solution this study advanced. In a sense, this study examines the impact of the current law and the duty of the court to probe the merits of impeachable transactions. Practical implications The study would give the legislature food for thought and would also guide the courts with matters of tax fraud. Originality/value Though the original recommendations form part of the current statute, this study is still immensely original in delivery and thought. It provide not only an original influence on the court but also the legislature with original solution to the existing problem.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:23:37Z
      DOI: 10.1108/JFC-09-2017-0085
      Issue No: Vol. 26, No. 1 (2019)
  • Determinants of sales misconduct in Indian retail banking services
    • Pages: 313 - 329
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 313-329, January 2019.
      Purpose The purpose of this paper is to demonstrate those factors which are responsible for the sales misconduct in Retail banking services across the world and try to find out the determinants which majorly affect the Indian Retail banking industry. The authors also try to find out whether the sales approach leads to malpractices in sales and how does it affect the different categories of the customers. Design/methodology/approach Primary data have been collected from the bank account holders having account in various private and public sector banks operating in India. Findings The authors have come out with finding that sales misconduct is majorly affected by misrepresentation of facts, complexity of products, lack of disclosure norms and more. They also found that push sales approach is adopted by banks, particularly by private banks to majorly tap the class customers to sell the financial products without their requirement and achieve the revenue targets. Practical implications Banking regulators can keep a close supervision on sales mal practices in banking sector and implement stringent norms to reduce these kinds of practices. Originality/value Very few studies have been conducted on the basis of the class of the customer, and how sales approach leads the malpractices in sales and how it affects the class of the customers.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:24:17Z
      DOI: 10.1108/JFC-12-2017-0126
      Issue No: Vol. 26, No. 1 (2019)
  • Corruption and socio-political economic structures: a case of Nigeria
    • Pages: 330 - 371
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 330-371, January 2019.
      Purpose “Corrupt practices” is a recurring feature of media coverage. The paper seeks to encourage debates about the influence of institutional structures on agency to break away from methodological individualism. This paper aims to encourage reflections on the role of both the structures and actors which have shaped the continuous expansion of corrupt practices in Nigeria. Design/methodology/approach Whilst recognising that deviant behaviour by some individuals is always possible, this paper has rejected methodological individualism and shows the value of locating anti-social practices within the broader socio-political and historical context. Within a socio-political framework, this study adopts the theories of critical realism, developmental state and globalisation to understand the relationship between social agency and society, focusing upon the institutional structures and the role of social actors. Findings The evidence shows that socio-political and economic development, politics, power, history and globalisation have continued to reproduce and transform the institutional structures and actors which have facilitated anti-social practices in Nigeria. The paper concludes that large sums of government revenue have been undermined by the anti-social practices of the Nigerian political and economic elite (both local and international), which have enriched a few, but impoverished most, Nigerians. Practical implications As a consequence of recurring corrupt practices in Nigeria, there is a pressing need for reform to curb these practices which have had, and continue to have, a serious effect on Nigeria and its future development. Originality/value It provides a framework for understanding and explaining the inter-relations of actors and institutional structures and the linkages and influences that have shaped the practices in Nigeria.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:24:44Z
      DOI: 10.1108/JFC-01-2018-0003
      Issue No: Vol. 26, No. 1 (2019)
  • Advancing theory of fraud: the S.C.O.R.E. model
    • Pages: 372 - 381
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 372-381, January 2019.
      Purpose This paper aims to elaborate on the theory of fraud by enhancing the existing theories behind the factors that force people to commit fraud. Design/methodology/approach The paper reviews the most commonly used and widely accepted models for explaining why people commit fraud – the fraud triangle, the fraud diamond, the fraud scale and the MICE model. The author argues that these models need to be updated to adapt to the current developments in the field and the ever-growing fraud incidents, both in frequency and severity, and builds on the theoretical background to create a new model so as to enhance the understanding behind the major factors which lead to the commitment of fraud. Findings The author identifies a major element – ego – which plays a crucial role in compelling people to commit fraud and concludes in the formation of the S.C.O.R.E. model, which is graphically depicted in the fraud pentagon. He goes further by adding the factor collusion to better apply in cases of white-collar crimes. Originality/value The paper develops the S.C.O.R.E. model to contribute to the development of fraud theory by identifying the key factors that play a major role in whether fraud will actually occur and acting as a theoretical benchmark for all future reference.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:25:22Z
      DOI: 10.1108/JFC-12-2017-0128
      Issue No: Vol. 26, No. 1 (2019)
  • Corruption in Russia’s Primorsky Kray: is transparency the
    • Pages: 382 - 395
      Abstract: Journal of Financial Crime, Volume 26, Issue 1, Page 382-395, January 2019.
      Purpose The purpose of this paper is to use open-source Russian government data to investigate the relationship between transparency and corruption. Russia is a developed country with a strong legal system and world-class transparency in government contracting, which according to many, should positively impact corruption. This study tests that hypothesis. Design/methodology/approach The paper statistically analyzes six months’ worth of Russian government contracts from a single Russian province and another month of data from a different province for comparison. The statistical analysis revealed individual instances of corruption, which were then analyzed qualitatively. Findings The paper found that competitiveness in Russian government contracting is extremely limited, and instances of corruption on a grand scale are easy to find in publicly available data. Research limitations/implications The paper only studied data from two Russian provinces, so readers should be careful about generalizing from the results. Further research should consider similar data, if obtainable, from other countries. Practical implications Countries seeking to limit corruption should consider cultural change, as well as modifications to government processes and legal systems. Originality/value The paper indicates that sound and transparent legal structures, by themselves, may be insufficient to prevent or discourage corruption.
      Citation: Journal of Financial Crime
      PubDate: 2019-03-05T01:22:55Z
      DOI: 10.1108/JFC-02-2018-0017
      Issue No: Vol. 26, No. 1 (2019)
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