Employee Fraud Intention via Fraud Triangle Theory Mediated by Ethical Values: a Study on the Malaysian Private Sector

Ng, Yin Wei (2022) Employee Fraud Intention via Fraud Triangle Theory Mediated by Ethical Values: a Study on the Malaysian Private Sector. Masters thesis, Tunku Abdul Rahman University College.

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Abstract

This study examines employee fraud intention via Fraud Triangle Theory mediated by ethical values in the Malaysian private sector. The effect of fraud intention will be discussed first in this study. Subsequently, the relationship between pressure, rationalisation and opportunity was further assessed together with the effect of ethical values as a mediating factor. A quantitative approach and a cross-sectional method have been employed using 218 employees who are currently working in various private sectors in Malaysia to achieve the objectives of this research. The data obtained are then analysed via Statistical Package for Social Sciences (SPSS) version 28 and Partial Least Square – Structural Equation Modelling (PLS-SEM, namely SmartPLS version 4). The conceptual framework has been developed based on the Fraud triangle theory. In fraud triangle theory mainly emphasises the factors induce, which include pressure, opportunity and rationalisation. In contrast, no research has been conducted on ethical value as a mediating variable. This research incorporates ethical values in line with Ziegenfuss (1996), who suggested further research on the fraud triangle theory that incorporates ethical value implications in response to employee fraud. Based on the result of this study further confirmed the elements of the fraud triangle developed by Cressey (1953), such as pressure, fraud and opportunity, are not standalone but interconnected. It was found ethical values were partially mediated between fraud triangle theories and fraud intention.