IMPACT OF FRAUD ON ORGANIZATIONAL PROFITABILITY: A STUDY OF SELECTED BANKS IN NIGERIA
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Date
2015
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Journal ISSN
Volume Title
Publisher
Ilorin Journal of Marketing
Abstract
The development in the banking industry over the years have resulted into complex and diverse situations. The traditional banking era have been replaced with modern methods due to the emergence of Information and Communication Technology (ICT). These developments have also influenced the practices as well as the nature of work in the industry. However as new technologies were developed new methods of defrauding and fraudulent acts were often perpetrated by customers as well as bank staffs. This paper therefore seeks to examine the impact of fraud on organizational profitability. Fraud and fraudulent activities pose a significant problem to the banking industry in Nigeria. Multiple regression analysis was used to examine the impact of the fraud on organizational profitability in Nigeria selected banks. Detailed questionnaire were used to obtain the required information from the respondents. However, due to the stringent measures adopted by the regulatory body to tackle the menace of fraud and fraudulent activities, there was a significant decrease between 2006 and 2011. The paper concluded that fraud and fraudulent activities inflict severe financial difficulties on banks and their customers. They reduce the amount of money available for the development of the organization. The study recommended that banks in Nigeria need to strengthen their infernal control systems and the regulatory bodies should improve their supervisory role in order to check and curtail the incidence of fraud and fraudulent activities in Nigeria banking industry.
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Keywords
Banks, Communication Technology Fraud, Information, Organization, Profitability