The Impact of Undergraduate’s Socio-Demographic Characteristics on the Risk of Deviant Financial Behavior

Abstract

Purpose: The paper demonstrates the authors' approach for the identification of groups of individuals who are prone to manifestations of various deviations in financial behavior. Design/Methodology/Approach: The research is based on empirical data from a survey of 912 senior students using a specially designed questionnaire. Applying a latent class analysis technique we distribute students into groups that differ in their attitude toward money, financial literacy, financial strategies, risk appetite, and a propensity to deviant behavior. Findings: The study showed that more prone to deviant financial strategies are mainly young men, prone to financial risk, enrolled in the commercial form of education, natives of regional subordination cities, those who not inclined to innovative financial strategies. More likely to be involved in illegal financial schemes those who we classified as "spendthrifts" from families without high income, "savers" and "reasonable" from high-income families. Practical Implications: Research results can be used to formulate policies to improve population financial literacy, as well as to adjust economic policy in general. There is a need for financial education programs to pay special attention to the issues of countering fraud, preventing involvement in money laundering and terrorism financing (ML/FT) processes. Originality/Value: The socio-demographic portrait of students most likely to engage in illegal financial strategies is not clearly formed. Individuals may be subject to financial deviations in some cases, with the purposeful influence of certain persons or circumstances.