EFFECT OF FORENSIC ACCOUNTING TECHNIQUES ON FRAUD DETECTION AMONG MICROFINANCE BANKS IN DELTA STATE

Abstract

Financial fraud remains a pervasive challenge globally, undermining the stability of economic systems and eroding stakeholders' confidence. In Nigeria, financial fraud has become endemic, affecting both public and private sectors. The banking industry, especially microfinance banks (MFBs), has recorded a high incidence of fraud-related cases. The main objective of this study were to examine the effect of forensic accounting techniques on fraud detection in microfinance banks in Delta State, Nigeria. This study adopts a descriptive survey research design. The population for this study consists of employees from microfinance banks operating in Delta State, Nigeria which are 264.Sample size for a population of 264 at a 5% margin of error using Taro Yamane's formula is 159A sample table summarizing the population and sample size is provided below. The data for this study will be collected primarily from primary sources, using structured questionnaires the data collected through structured questionnaires will be analyzed using both descriptive and inferential statistical techniques. The analysis will be conducted using Statistical Package for the Social Sciences (SPSS). The findings offer valuable insights. The study analysis showed that Digital Forensic Techniques (DFT), Investigative Accounting Techniques (IAT), and Litigation Support Services (LSS) all have a significant positive effect on fraud detection, meaning these methods are highly effective tools in identifying and preventing fraud in these banks. On the other hand, Data Analysis Techniques (DAT) did not show a significant impact on fraud detection in this particular context. This suggests that while data analysis can be useful in some cases, it may not be the most effective standalone tool for detecting fraud, especially in environments with limited technological infrastructure. The study recommended among others that Microfinance banks should prioritize integrating DFT tools like data mining and cyber forensic analysis to enhance fraud detection. They should allocate funds for these tools, provide staff training, and collaborate with cybersecurity experts to stay ahead of new fraud tactics and Banks should integrate forensic accounting practices into their operations by establishing dedicated teams for auditing and investigating suspicious transactions. Regular audits and partnering with external forensic accounting experts can help detect fraudulent activities