Risk management, top management support, internal audit activities and fraud mitigation

Waled Younes E. Alazzabi, Hasri Mustafa and Ahmed Ibrahim Karage

Journal of Financial Crime, 2020, vol. 30, issue 2, 569-582

Abstract: Purpose - This paper aims to examine the effect of top management support (TMS) and risk management (RM) on the internal audit activities (IAA) and fraud mitigation (FM) in the Libyan banking sector. Design/methodology/approach - The data is collected using a survey questionnaire of 16 commercial banks in Libya and analysed using a structural equation modeling. Findings - The study shows positive and significant relationships between RM and employees’ FM and TMS and employees’ FM. The study also demonstrates a significant mediating effect on the relationship between RM, TMS and FM. Research limitations/implications - The study is conducted in the Libyan banking sector. Further research is needed in other contexts and sectors to understand the contribution of the RM and TMS on FM, including the impact of technology and internal audit characteristics in terms of experience, education and professional certificates on FM. Originality/value - The study is the first attempt to explore FM in an emerging economy, particularly Libya, by introducing IAA as a mediator. The study provides implications for regulators and top management in the banking sector.

Keywords: Banking; Libya; Top management support; Risk management; Fraud mitigation; Internal audit activities (search for similar items in EconPapers)
Date: 2020
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Persistent link: https://EconPapers.repec.org/RePEc:eme:jfcpps:jfc-11-2019-0147

DOI: 10.1108/JFC-11-2019-0147

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