INTERNAL CONTROL MEASURES ON FRAUD DETECTION AND PREVENTION IN FINTECH COMPANIES IN KENYA
Wanyama, Doughty Natalie
Reuben, Dr. James Mwikya
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The study sought to examine the effect of internal controls on fraud detection and prevention among Financial Technology (FINTECH) Companies in Kenya, case of Interswitch (Kenya) Limited. The study adopted three major objectives; to establish the impact of know your customer practices on fraud detection and prevention, to examine the effects of information technology on fraud detection and prevention and to determine the impact of staff training on fraud detection and prevention. The target population of 200 and a sample size of 100 people, this study employed primary data collected through questionnaires. The study adopted a descriptive survey research design, the decision to apply descriptive cross-sectional survey research design. The study results showed R = 0.734 that means there was strong and positive relationship between the study’s internal control measures and fraud detection and prevention. Further the regression shows an overall R2 = 0.539 meaning that 53.9% of the measures of detection and prevention of fraud in financial technologies companies in Kenya is explained by the three independent variables namely information technology, know your customer and staff training. Study conclusions are; through reliable information technology, company management will be able to take strategic decisions for the future of the company, especially in detection and prevention fraud. The use of CAATs or e-audit systems is able to overcome fraud risk and this is believed to be able to detect the possibility of fraud that may occur. Know your customer check should be a mandatory process of identifying and verifying the client's identity when opening an account and periodically over time. In order to detect and prevent fraud, employees must first know what to look for, and then what to do about it. Finally the internal control measure’s has an influence on detection and prevention fraud.