A Preliminary Study on Fraud Prevention and Detection at the State and Local Government Entities in Malaysia

Abstract

This study examines the occurrence of fraud and identifies the prevention programs in place at the State and Local Government entities in Malaysia. Issues related to fraud are of interest due to the frequent coverage by the media which has affected public confidence. The findings suggest that fraud is a significant problem, and the main causes of fraud are poor management practices and economic pressure. Interestingly, the study finds that, in most cases, management did not take firm action against the culprits when they were caught and found guilty. Most fraud incidents were discovered through the internal audit review, employee notification and accidental discovery. The findings also reveal that most of these entities did not have effective policies and procedures for dealing with fraud.

A Review of Effects of Quality Municipal Services on Citizen Satisfaction in Malaysian Municipal Council: A Content Analysis

“…In many cases citizen satisfaction appears to be bottle neck to local administrators' as they showcase their ability to generates cordial relation with the inhabitants are contributing to fragmentation and segregation, they are socially exclusive and barely leave space for non-commercial activities [40]. Drastic changes in society: fast urbanization, changes in the relation between the urban and the rural, globalization, economic changes and the need for more sustainable solutions for spatial problems the themes of the other sessions in the conference all lead to new urban forms or new forms of urbanism [41]. The determinants for citizen satisfactions were government sincerity, municipal awareness, facilities maintenance and timeliness of target the neediest communities, have systems in place to track expenditures on projects and be able to determine if the allocation of resources has had an impact on the lives of local inhabitants [53,54].…”

Development of Fraud Prevention (FP) Model Using the Theory of Planned Behavior

“…The government sector is not excluded from experiencing impact of losses due to fraud (Ghazali, Rahim, Ali & Abidin, 2014). Fraud occurrences in the public sector have always been and will continue to be a thorn inside any government in the world.…”

Development of a Fraud Risk Control Policy Framework for Public Sector Organizations

“…Kemp [6] explains three main reasons that can trigger rising fraud levels in the public sector: recessionary fall-out, continued cut-backs, and the growth of online services. Adding to that, Ghazali, Rahim, Ali, and Abidin [7] consider that the main cause of fraud in government institutions in Malaysia is poor management practices. To combat fraud in government, there should be more focus on the effectiveness of internal control, action against fraudsters, and oversight by management.…”

“…Ghazali, Rahim, Ali, and Abidin [7] state that most cases of fraud are found through the work of internal auditors, which demonstrates the importance of internal auditors in protecting government interests from fraud. For fraud prevention policies to be more effective, internal audit units should be given full authority to carry out their duties and their functions must be independent of government management.…”