DOI: https://doi.org/10.32515/2663-1636.2024.11(44).65-84
Peculiarities of Сorporate Fraud in Business: Essence, Consequences and Countermeasures in the Context of Resistance to Change
About the Authors
Ihor Haidukov, Director, LLC “ILVIS”, Kropyvnytskyi, Ukraine, ORCID: https://orcid.org/0009-0001-8103-5728, e-mail: gaidukoviv@kntu.kr.ua
Ilona Androshchuk, Associate Professor, PhD in Economics (Candidate of Economic Sciences), Associate Professor of the Department of Economics, Management and Commercial Activity, Central Ukrainian National Technical University, Kropyvnytskyi, Ukraine, ORCID: https://orcid.org/0000-0002-2232-8061, e-mail: androshchukio@kntu.kr.ua
Abstract
The paper is devoted to the peculiarities of corporate fraud in business: essence, consequences and countermeasures in the context of resistance to change. The purpose of the study is to analyze corporate fraud, regardless of the places of occurrence, its signs and means of countermeasures, precisely as a system that combines both preventive and control measures. The analysis of approaches to the classification of fraud was carried out. The most common types of fraud were thoroughly examined. The amount of financial losses from fraud was determined. The investigation of the factors that encourage employees to commit fraud was conducted. The structure of the fraud triangle was analyzed: motivation, opportunity and rationalization. The "typical look" of the fraudster has been formed. The traits that are characteristic of fraudsters have been established. The peculiarities of the structural divisions of enterprises from the point of view of the level of fraud risk were defined. The components of the effective anti-fraud strategy has been considered, namely: creating a decent ethical culture, training and raising awareness of fraud risks, mechanisms for reporting and reporting corruption, building an internal control system, and pre-employment screening. The analysis of the sources of information on possible cases of fraud was carried out. The methods of detecting fraudulent actions were studied. The key indicators of fraud have been identified as follows: warning signs and "calls" about fraud. A list of "calls" that serve as a signal to commit fraudulent actions has been proposed. The key aspects of internal fraud in business, which determine its complexity and the importance of fighting this problem, have been formulated, in particular: social and economic reasons, unforeseen consequences, various types of fraud, difficulty of detection, practical difficulties in collecting statistics.
Keywords
corporate fraud, business, resistance to change, senior management, fraud triangle
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References
1. Borys S. A. (2019) Shakhraistvo na pidpryiemstvi: prychyny ta naslidky, vyiavlennia ta protydiia [Fraud in the enterprise: causes and consequences, detection and counteraction]. Yuryst Zakon ̶ Lawyer Law. http://surl.li/gnlbe [In Ukrainian]
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5. Khamyha Yu. Ya. (2020). Financial fraud: identification criteria and directions for minimization. Candidate’s thesis, 308.
6. ACFE. Data on fraud, fraudsters and anti-fraud programs. https://www.acfe.com/fraud-resources/reports-and-statistics [in English].
7. IMF. World Economic Outlook. https://www.imf.org/en/Publications/WEO [in English].
8. KPMG. Global profiles of the fraudster. https://kpmg.com/be/en/home/insights/2016/05/global-profiles-of-the-fraudster.html [in English].
9. Kroll. Fraud and Financial Crime Report 2023. https://www.kroll.com/en/insights/publications/fraud-and-financial-crime-report [in English].
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12. Research: Why Corporate Fraud Reports are Down. https://hbr.org/2020/07/research-why-corporate-fraud-reports-are-down [in English].
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14. The Fraud Triangle. A model for identifying high risks of fraud highlights three factors that lead to fraud: motivation, opportunity, and rationalization. https://www.whistleblowers.org/ [in English].
15. What is the ethical issue? https://www.ibe.org.uk/knowledge-hub/speak-up.html [in English].
Citations
1. Борис С. А. Шахрайство на підприємстві: причини та наслідки, виявлення та протидія. Юрист Закон. 2019. № 9. URL: http://surl.li/gnlbe (Дата звернення: 04.04.2024).
2. Климко Т. Ю., Мельник О. О. Корпоративне шахрайство: реалії сучасності. Науковий вісник Ужгородського університету. Серія: Економіка. 2015. Вип. 2. С. 185-190. URL: http://nbuv.gov.ua/UJRN/ Nvuuec_2015_2_33 (Дата звернення: 22.04.2024).
3. Кримінальний Кодекс України. URL: https://zakon.rada.gov.ua/laws/show/2341-14#Text (Дата звернення: 30.04.2024)
4. Нежива М. О., Мисюк В. О. Протидія шахрайству в умовах війни. Бізнес Інформ. 2023. № 1. С. 160 – 166. DOI: https://doi.org/10.32983/2222-4459-2023-1-160-166 (Дата звернення: 22.04.2024).
5. Хамига Ю. Я. Фінансове шахрайство: критерії ідентифікації та напрями мінімізації. Дисертація на здобуття наукового ступеня доктора філософії за спеціальністю 072 «Фінанси, банківська справа та страхування», 2020. 308 с.
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7. IMF. World Economic Outlook. URL: https://www.imf.org/en/Publications/WEO (Дата звернення: 15.04.2024)
8. KPMG. Global profiles of the fraudster. URL: https://kpmg.com/be/en/home/insights/2016/05/global-profiles-of-the-fraudster.html (Дата звернення: 12.05.2024)
9. Kroll. Fraud and Financial Crime Report 2023. URL: https://www.kroll.com/en/insights/publications/fraud-and-financial-crime-report (Дата звернення: 10.04.2024)
10. Occupational Fraud 2022: A Report to the Nations. URL: https://legacy.acfe.com/report-to-the-nations/2022/?_ga=2.81367959.1833531643.1704446443-705041068.1704446063 (Дата звернення: 10.04.2024)
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13. The Chartered Institute of Management Accounts. URL: https://www.aicpa-cima.com/home (Дата звернення: 17.04.2024)
14. The Fraud Triangle. A model for identifying high risks of fraud highlights three factors that lead to fraud: motivation, opportunity, and rationalization. URL: https://www.whistleblowers.org/ (Дата звернення: 10.04.2024)
15. What is the ethical issue? URL: https://www.ibe.org.uk/knowledge-hub/speak-up.html (Дата звернення: 17.04.2024)
Copyright (c) 2024 Ihor Haidukov, Ilona Androshchuk
Peculiarities of Сorporate Fraud in Business: Essence, Consequences and Countermeasures in the Context of Resistance to Change
About the Authors
Ihor Haidukov, Director, LLC “ILVIS”, Kropyvnytskyi, Ukraine, ORCID: https://orcid.org/0009-0001-8103-5728, e-mail: gaidukoviv@kntu.kr.ua
Ilona Androshchuk, Associate Professor, PhD in Economics (Candidate of Economic Sciences), Associate Professor of the Department of Economics, Management and Commercial Activity, Central Ukrainian National Technical University, Kropyvnytskyi, Ukraine, ORCID: https://orcid.org/0000-0002-2232-8061, e-mail: androshchukio@kntu.kr.ua
Abstract
Keywords
Full Text:
PDFReferences
1. Borys S. A. (2019) Shakhraistvo na pidpryiemstvi: prychyny ta naslidky, vyiavlennia ta protydiia [Fraud in the enterprise: causes and consequences, detection and counteraction]. Yuryst Zakon ̶ Lawyer Law. http://surl.li/gnlbe [In Ukrainian]
2. Klymko T. Yu., Melnyk O. O. (2015). Korporatyvne shakhraistvo: realii suchasnosti [Corporate fraud: modern realities]. Naukovyi visnyk Uzhhorodskoho universytetu ‒ Scientific Bulletin of Uzhhorod University Seriia: Ekonomika. http://nbuv.gov.ua/UJRN/Nvuuec [in Ukrainian].
3. Kryminalnyi Kodeks Ukrainy. https://zakon.rada.gov.ua/laws/show/2341-14#Text [in Ukrainian].
4. Nezhyva, M. O. & Mysiuk,V. O (2023). Protydiia shakhraistvu v umovakh viiny [Anti-Fraud During the War]. Biznes Inform ̶ Business Inform. https://doi.org/10.32983/2222-4459-2023-1-160-166 [in Ukrainian].
5. Khamyha Yu. Ya. (2020). Financial fraud: identification criteria and directions for minimization. Candidate’s thesis, 308.
6. ACFE. Data on fraud, fraudsters and anti-fraud programs. https://www.acfe.com/fraud-resources/reports-and-statistics [in English].
7. IMF. World Economic Outlook. https://www.imf.org/en/Publications/WEO [in English].
8. KPMG. Global profiles of the fraudster. https://kpmg.com/be/en/home/insights/2016/05/global-profiles-of-the-fraudster.html [in English].
9. Kroll. Fraud and Financial Crime Report 2023. https://www.kroll.com/en/insights/publications/fraud-and-financial-crime-report [in English].
10. Occupational Fraud 2022: A Report to the Nations. https://legacy.acfe.com/report-to-the-nations/2022/?_ga=2.81367959.1833531643.1704446443-705041068.1704446063 [in English].
11. PwC’s Global Economic Crime and Fraud Survey 2022. https://www.pwc.com/gx/en/services/forensics/economic-crime-survey.html [in English].
12. Research: Why Corporate Fraud Reports are Down. https://hbr.org/2020/07/research-why-corporate-fraud-reports-are-down [in English].
13. The Chartered Institute of Management Accounts. https://www.aicpa-cima.com/home [in English].
14. The Fraud Triangle. A model for identifying high risks of fraud highlights three factors that lead to fraud: motivation, opportunity, and rationalization. https://www.whistleblowers.org/ [in English].
15. What is the ethical issue? https://www.ibe.org.uk/knowledge-hub/speak-up.html [in English].
Citations
1. Борис С. А. Шахрайство на підприємстві: причини та наслідки, виявлення та протидія. Юрист Закон. 2019. № 9. URL: http://surl.li/gnlbe (Дата звернення: 04.04.2024).
2. Климко Т. Ю., Мельник О. О. Корпоративне шахрайство: реалії сучасності. Науковий вісник Ужгородського університету. Серія: Економіка. 2015. Вип. 2. С. 185-190. URL: http://nbuv.gov.ua/UJRN/ Nvuuec_2015_2_33 (Дата звернення: 22.04.2024).
3. Кримінальний Кодекс України. URL: https://zakon.rada.gov.ua/laws/show/2341-14#Text (Дата звернення: 30.04.2024)
4. Нежива М. О., Мисюк В. О. Протидія шахрайству в умовах війни. Бізнес Інформ. 2023. № 1. С. 160 – 166. DOI: https://doi.org/10.32983/2222-4459-2023-1-160-166 (Дата звернення: 22.04.2024).
5. Хамига Ю. Я. Фінансове шахрайство: критерії ідентифікації та напрями мінімізації. Дисертація на здобуття наукового ступеня доктора філософії за спеціальністю 072 «Фінанси, банківська справа та страхування», 2020. 308 с.
6. ACFE. Data on fraud, fraudsters and anti-fraud programs. URL: https://www.acfe.com/fraud-resources/reports-and-statistics (Дата звернення: 10.05.2024)
7. IMF. World Economic Outlook. URL: https://www.imf.org/en/Publications/WEO (Дата звернення: 15.04.2024)
8. KPMG. Global profiles of the fraudster. URL: https://kpmg.com/be/en/home/insights/2016/05/global-profiles-of-the-fraudster.html (Дата звернення: 12.05.2024)
9. Kroll. Fraud and Financial Crime Report 2023. URL: https://www.kroll.com/en/insights/publications/fraud-and-financial-crime-report (Дата звернення: 10.04.2024)
10. Occupational Fraud 2022: A Report to the Nations. URL: https://legacy.acfe.com/report-to-the-nations/2022/?_ga=2.81367959.1833531643.1704446443-705041068.1704446063 (Дата звернення: 10.04.2024)
11. PwC’s Global Economic Crime and Fraud Survey 2022. URL: https://www.pwc.com/gx/en/services/forensics/economic-crime-survey.html (Дата звернення: 14.04.2024)
12. Research: Why Corporate Fraud Reports are Down. URL: https://hbr.org/2020/07/research-why-corporate-fraud-reports-are-down (Дата звернення: 12.04.2024)
13. The Chartered Institute of Management Accounts. URL: https://www.aicpa-cima.com/home (Дата звернення: 17.04.2024)
14. The Fraud Triangle. A model for identifying high risks of fraud highlights three factors that lead to fraud: motivation, opportunity, and rationalization. URL: https://www.whistleblowers.org/ (Дата звернення: 10.04.2024)
15. What is the ethical issue? URL: https://www.ibe.org.uk/knowledge-hub/speak-up.html (Дата звернення: 17.04.2024)