Article Sidebar

Download
PDF
Statistic
Read Counter : 351 Download : 122

Main Article Content

Abstract

Fraud in government is a major challenge that impacts public trust and the efficiency of state administration. This study aims to analyze the trends, causes, and mitigation strategies of fraud in the government sector through a systematic literature review approach. Based on the fraud triangle theory which includes pressure, opportunity, and rationalization, it was found that fraud in the public sector is often triggered by weak internal control, political and economic pressure, and an organizational culture that is permissive of corruption. Recent trends show an increase in the use of digital technology in fraud modes, especially in data manipulation and public procurement. This study also identifies mitigation strategies, including the implementation of effective internal control, strengthening transparency, ethics education, and collaboration between supervisory institutions. These findings are expected to provide relevant policy recommendations for the government to improve transparency, accountability, and integrity in the public sector.

Keywords

Fraud Trends in Government Causes of Fraud in Government Fraud Mitigation in Government Systematic Literature Review

Article Details

References

  1. Abdullahi, R., & Mansor, N. (2018). Fraud prevention initiatives in the Nigerian public sector: Understanding the relationship of fraud incidences and the elements of fraud triangle theory. Journal of Financial Crime, 25(2), 527–544. https://doi.org/10.1108/JFC-02-2015-0008
  2. ACFE. (2019). Survei Fraud Indonesia. https://acfe-indonesia.or.id/wp-content/uploads/2021/02/SURVEI-FRAUD-INDONESIA-2019.pdf
  3. Achcar, G. (2021). Hegemony, Domination, Corruption and Fraud in the Arab Region. Middle East Critique, 30(1), 57–66. https://doi.org/10.1080/19436149.2021.1875173
  4. Albanese, J. S., Artello, K., & Nguyen, L. T. (2019). Distinguishing Corruption in Law and Practice: Empirically Separating Conviction Charges from Underlying Behaviors. Public Integrity, 21(1), 22–37. https://doi.org/10.1080/10999922.2018.1423859
  5. Albrecht, W. S., & Albrecht, C. O. (2003). Fraud Examination and Prevention 1st Edition. South-Western Educational Pub. https://books.google.co.id/books?id=LtJ9QgAACAAJ
  6. Ashforth, B. E., & Anand, V. (2003). The normalization of corruption in organizations. Research in Organizational Behavior, 25, 1–52.
  7. Association of Certified Fraud Examiners. (2023). Occupational Fraud 2022 : A Report To The Nations.
  8. Association of Certified Fraud Examiners. (2024). Fraud 101: What Is Fraud? https://www.acfe.com/fraud-resources/fraud-101-what-is-fraud
  9. As’ad, A., Brasit, N., Muis, M., & Umar, F. (2024). uNVEILING THE ANTECEDENTS OF SuSTAINABLE PERFORMANCE: INSIGHTS FROM HOSPITALITY INDuSTRY MANAGERS.
  10. COSO. (2013). Internal Control—Integrated Framework. Committee of Sponsoring Organizations of the Treadway Commission.
  11. Cressey, D. R. (1953). Other People’s Money; a Study of the Social Psychology of Embezzlement. Free Press.
  12. Denyer, D., & Tranfield, D. (2009). Producing a systematic review.
  13. Dewi, Y. T. T. M., & Muslimin. (2021). Analisis Faktor-Faktor Yang Mempengaruhi Kecurangan (Fraud) Pada Sektor Pemerintahan. Jurnal Proaksi, 8(2), 596–610. https://e-journal.umc.ac.id/index.php/JPK
  14. FEB Unair. (2024, May 29). “Systematic Literature Review Melalui Watase Uake Untuk Pengembangan Penelitian” Hima S3 Ilmu Ekonomi Universitas Airlangga. https://feb.unair.ac.id/news-download/news-mahasiswa/hima-s3-ie/8761-systematic-literature-review-melalui-watase-uake-untuk-pengembangan-penelitian-hima-s3-ilmu-ekonomi-universitas-airlangga.html
  15. Fenger, M., & Simonse, R. (2024). The implosion of the Dutch surveillance welfare state. Social Policy and Administration, 58(2), 264–276. https://doi.org/10.1111/spol.12998
  16. Ferrari, S., & Cerutti, P. O. (2023). Timber Trade in the Eastern Democratic Republic of the Congo (DRC): Effectiveness of Timber Parks in Tackling Tax Frauds. International Forestry Review, 25(2), 177–189. https://doi.org/10.1505/146554823837244446
  17. Handayani, F., Sari, D. M., Yuniarti, A., Tinggi, S., & Ekonomi, I. (2022). Faktor-Faktor yang Mempengaruhi Kualitas Informasi Laporan Keuangan Pemerintah Daerah Kota Balikpapan. Jurnal Ilmiah Akuntansi Dan Keuangan, 11(1), 9–20. https://doi.org/10.32639/jiak.v11i1.14
  18. Haurissa, N. F., & Dewi, C. N. (2021). Analisis Meta Fraud di Pemerintahan Indonesia. Perspektif Akuntansi, 4(3), 297–319. https://doi.org/10.24246/persi.vXiX.p297-319
  19. Hogan, C. E., Rezaee, Z., Riley Jr, R. A., & Velury, U. K. (2008). Financial Statement Fraud: Insights from the Academic Literature. Auditing: A Journal of Practice & Theory, 27(2), 231–252.
  20. Horwath, C. (2011). Why the Fraud Triangle is No Longer Enough. Horwath, Crowe LLP.
  21. Jensen, M. C., & Meckling, W. H. (2019). Theory of the firm: Managerial behavior, agency costs and ownership structure. In Corporate governance (pp. 77–132). Gower.
  22. KPMG. (2021). The Changing Landscape of Fraud: Fraud Risk Management in the Digital Era. https://home.kpmg/xx/en/home/insights/2021/01/fraud-risk-management-in-the-digital-era.html
  23. Lewis, B. D., & Hendrawan, A. (2019). The impact of majority coalitions on local government spending, service delivery, and corruption in Indonesia. European Journal of Political Economy, 58, 178–191. https://doi.org/10.1016/j.ejpoleco.2018.11.002
  24. Maulidi, A. (2020). When and why (honest) people commit fraudulent behaviours?: Extending the fraud triangle as a predictor of fraudulent behaviours. Journal of Financial Crime, 27(2), 541–559. https://doi.org/10.1108/JFC-05-2019-0058
  25. Maulidi, A., & Ansell, J. (2020). Tackling practical issues in fraud control: a practice-based study. Journal of Financial Crime, 28(2), 493–512. https://doi.org/10.1108/JFC-07-2020-0150
  26. Montesdeoca, M. R., Medina, A. J. S., & Santana, F. B. (2019). Research topics in accounting fraud in the 21st century: A state of the art. In Sustainability (Switzerland) (Vol. 11, Issue 6). MDPI. https://doi.org/10.3390/su11061570
  27. Murphy, P. R. (2012). Attitude, Machiavellianism and The Rationalization of Misreporting. Accounting, Organizations and Society, 37(4), 242–259.
  28. Naher, N., Hoque, R., Hassan, M. S., Balabanova, D., Adams, A. M., & Ahmed, S. M. (2020). Erratum: Correction to: The influence of corruption and governance in the delivery of frontline health care services in the public sector: a scoping review of current and future prospects in low and middle-income countries of south and south-east Asia (BM. BMC Public Health, 20(1), 1082. https://doi.org/10.1186/s12889-020-09197-0
  29. Ning, Z., & Qi, X. (2023). Is economic policy uncertainty an excuse for corporate fraud? Economic Research-Ekonomska Istrazivanja , 36(2). https://doi.org/10.1080/1331677X.2023.2182809
  30. Nuswantara, D. A., & Maulidi, A. (2021). Psychological factors: self- and circumstances-caused fraud triggers. Journal of Financial Crime, 28(1), 228–243. https://doi.org/10.1108/JFC-05-2020-0086
  31. Nuswantara, D. A., Maulidi, A., & Pujiono. (2017). The efficacy of control environment as fraud deterrence in local government. Management and Marketing, 12(4), 591–613. https://doi.org/10.1515/mmcks-2017-0035
  32. OECD. (2020). OECD Public Integrity Handbook. OECD Publishing. https://doi.org/https://doi.org/10.1787/ac8ed8e8-en
  33. Pontoh, G. T., Indrijawati, A., Selvi, F., Ningsih, L., & Putri, D. R. (2024). A Systematic Literature Review of ERP and RFID Implementation in Supply Chain Management. WSB Journal of Business and Finance, 58(1), 80–96.
  34. Prabowo, H. Y. (2016). Sight beyond sight: Foreseeing corruption in the Indonesian government through behavioral analysis. Journal of Financial Crime, 23(2), 289–316. https://doi.org/10.1108/JFC-12-2014-0063
  35. Reinstein, A., & Taylor, E. Z. (2017). Fences as Controls to Reduce Accountants’ Rationalization. Journal of Business Ethics, 141, 477–488.
  36. Rispel, L. C., Jager, P. De, & Fonn, S. (2016). Exploring corruption in the South African health sector. Health Policy and Planning, 31(2), 239–249. https://doi.org/10.1093/heapol/czv047
  37. Rönnerstrand, B., & Lapuente, V. (2017). Corruption and use of antibiotics in regions of Europe. Health Policy, 121(3), 250–256. https://doi.org/10.1016/j.healthpol.2016.12.010
  38. Rose-Ackerman, S., & Palifka, B. J. (2016). Corruption and government: Causes, consequences, and reform. Cambridge university press.
  39. Rustiarini, N. W., Sutrisno, S., Nurkholis, N., & Andayani, W. (2019). Fraud Triangle in Public Procurement: Evidence from Indonesia. Journal of Financial Crime, 26(4), 951–968. https://doi.org/10.1108/JFC-11-2018-0121
  40. Rustiarini, N. W., T, S., Nurkholis, N., & Andayani, W. (2019). Why people commit public procurement fraud? The fraud diamond view. In Journal of Public Procurement (Vol. 19, Issue 4, pp. 345–362). Emerald Group Holdings Ltd. https://doi.org/10.1108/JOPP-02-2019-0012
  41. Shonhadji, N., & Maulidi, A. (2022). Is it suitable for your local governments? A contingency theory-based analysis on the use of internal control in thwarting white-collar crime. Journal of Financial Crime, 29(2), 770–786. https://doi.org/10.1108/JFC-10-2019-0128
  42. Sukanto, E. (2009). Perbandingan Persepsi Auditor Internal, Akuntan Publik, dan Auditor Pemerintah Terhadap Penugasan Fraud Audit dan Profil Fraud Auditor. Fokus Ekonomi: Jurnal Ilmiah Ekonomi, 4(1), 13–26. https://doi.org/https://doi.org/10.34152/fe.4.1.%25p
  43. Sukhemi, S., Sari, I. A. A., & Indriati, I. H. (2022). Determining Factors of Fraud in Local Government. Jurnal Ilmiah Akuntansi Dan Keuangan, 11(1), 1–8. https://doi.org/10.32639/jiak.v11i1.13
  44. Taylor, J. (2019). What causes employees to whistle while they work? Factors affecting internal whistle-blowing in the Australian Public Service. Australian Journal of Public Administration, 78(4), 497–515. https://doi.org/10.1111/1467-8500.12401
  45. Transparency International. (2022). Global Corruption Report. Transparency International.
  46. Transparency International Indonesia. (2024, January 30). Corruption Perceptions Index 2023. https://ti.or.id/corruption-perceptions-index-2023/
  47. United Nations Office on Drugs and Crime. (2019). Preventing and Combating Corruption in Public Administration. https://www.unodc.org/
  48. Vian, T. (2020). Anti-corruption, transparency and accountability in health: concepts, frameworks, and approaches. In Global Health Action (Vol. 13, Issue sup1). Taylor and Francis Ltd. https://doi.org/10.1080/16549716.2019.1694744
  49. Vousinas, G. L. (2019). Advancing Theory of Fraud: The S.C.O.R.E. Model. Journal of Financial Crime, 26(1), 372–381. https://doi.org/10.1108/JFC-12-2017-0128
  50. Wahyudi, L. (2024). Watase Uake: Research Collaboration Tools. https://www.watase.web.id/
  51. Wells, J. T. (2004). New Approaches to Fraud Deterrence. Journal Of Accountancy, 197(2), 72–76.
  52. Wells, J. T. (2017). Corporate fraud handbook: Prevention and detection. John Wiley & Sons.
  53. Wijayanto, F. L. (2020). Komitmen Organisasi, Kapabilitas, Gaya Kepemimpinan dan Kecenderungan Fraud di Sektor Pemerintahan (Persepsi Aparatur Sipil Negara di Kota Salatiga). Jurnal Ilmu Sosial Dan Humaniora, 9, 120–130.
  54. Wolfe, D. T., & Hermanson, D. R. (2004). The Fraud Diamond : Considering the Four Elements of Fraud: Certified Public Accountant. The CPA Journal, 74(12), 38–42.
  55. World Bank. (2020). Enhancing Government Effectiveness and Transparency: The Fight Against Corruption. World Bank.
  56. World Bank. (2021). Finding Fraud : Govtech and Fraud Detection in Public Administration. https://documents1.worldbank.org/curated/en/887311603104832916/pdf/Finding-Fraud-GovTech-and-Fraud-Detection-in-Public-Administration.pdf
  57. Yasmin, M., Haliah, Kusumawati, A., & Darmawati. (2024). The effect of brainstorming, auditor ethics, and whistleblowers on audit opinions of government financial reports: The moderating role of management support. Asian Economic and Financial Review, 14(4), 276–294. https://doi.org/10.55493/5002.v14i4.5019.