Corporate Fraud
Journal Title: Journal of Advanced Research in HR & Organizational Management - Year 2018, Vol 5, Issue 1
Abstract
This chapter reveals about the frauds that increasing at a high rate in the corporate sector. Corporate sector consist of private companies, commercial banks, etc. Basically, corporate fraud is an illegal and criminal offence that an individual or company does in order to gain unfair advantage. It affects the economy as well as customers of the organization. Today, the fraud in the corporate sector is on rise. We came to know about new scams and fraud each and every day. But why these frauds are rising? What is the need of giving rise to the activities like fraud? The answer to the above questions is greed and dishonesty among the employees. Greed is the only cause because of which the fraud in the corporate sector is rising. Because of such frauds, middle class people have to face a lot of financial problems. Middle class people invest their money in the shares of the company and because of fraud, the nominal value of the share falls and they have to face a huge loss. Usually, people deposit their surplus income in the bank to gain interest, but to fraud in the banks, their money gets stolen because of which they have to face a lots of financial problem. A fraud also affects the image of the company. The image or goodwill of the company goes down in the market and loses the trust of the customers and investors. Let’s take the example of latest fraud case. The latest fraud case is of PNB Bank. The fraud is done by Nirav Modi of about Rs.12, 600 crore. There are also some of the famous corporate frauds such as Satyam scandal, fraud of Sahara, fraud of Kingfisher, etc. These frauds are arising because businessman are not having proper look after over the accounts. They do not go through the accounts and statements on regular basis. In order to minimize the corporate frauds, certain actions must be taken. There must be a proper and personal check over all the employees. Experts must be hired to inspect the accounts. Important and confidential data must be handled personally. Statements must be checked on regular basis. Above are certain steps that a company might follow in order to reduce the rising practice of corporate fraud.
Authors and Affiliations
Sparsh Jain
Keywords
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