Business Frauds in Nigeria: Underlying Causes Effects and Possible Remedies Case Study of Banking Sector

In recent times so many business have collapsed caused by many factors of which a greater percentage of it is fraud and more importantly, fraud in banking sector of the economy. This is one of the biggest single causes of bank failure and distress in the Nigerian banking system. This study therefore was conducted to find common types of bank fraud that are frequently occurred in the banking sector, the underlying causes, level of staff involvement, consequences and possible means of ameliorating the problem. A sample of 150 respondents taken in Owerri City, capital of Imo State, Nigeria was studied by means of field survey tool of questionnaire and the response to rating scale questions were tested for significance using the “t-test”. The analysis revealed that respondents did not view unofficial borrowing and foreign exchange malpractice as forms of bank fraud since they were common and an industry wide practice. It also revealed that types of frauds perpetuated by banks’ staff alone do not affect the level of operations of the banks. By extension, frauds committed by banks’ staff alone cannot lead to distress of the banks. More so, it shows that there are other fraudulent factors outside the banks’ control that actually causes bank distress in Nigeria. The unique contribution of this paper is its emphasis on building upon the methodology and findings of some previous studies in the area of bank fraud remedies in Nigeria, by conducting statistical test of significance which adds statistical validity and flavour to our findings.