Special Issue "Economic and Financial Crimes"

A special issue of Risks (ISSN 2227-9091).

Deadline for manuscript submissions: closed (31 July 2021).

Special Issue Editor

Prof. Dr. Monica Violeta Achim
E-Mail Website
Guest Editor
Faculty of Economics and Business Administration, Department of Finance, Babes-Bolyai University, 400591 Cluj-Napoca, Romania
Interests: finance; financial analysis; business performance; corporate governance; economic and financial crimes

Special Issue Information

Dear Colleagues,

Despite all the efforts made to combat economic and financial crime, it remains a long-standing problem. With this Special Issue, we cordially invite researchers to share their results to reflect new directions regarding economic and financial crimes, such as fraud, corruption, the shadow economy, tax evasion, cybercrimes, money laundering. We hope to highlight the determining factors, the effects of economic and financial crimes, and international bodies and initiatives to prevent, fight against, and investigate economic and financial crimes. Studies focused on the influence of the COVID-19 pandemic on various types of economic and financial crimes are also welcome.

Topics:

  • Corruption, the shadow economy, money laundering, cybercrime, tax evasion, fraud;
  • Measuring economic and financial crime;
  • Determinants of financial crimes;
  • Bank performances, operational risk, and financial crimes;
  • Public governance and financial crimes;
  • Tax burden and financial crimes;
  • Earning management/creative accounting and fraud;
  • Corporate governance patterns, audits, and fraud;
  • The influence of cultural factors, religion, tax morale, trust, and happiness on financial crimes;
  • The profile of the fraudster;
  • Measures of combating financial crime;
  • The efficiency of the fight against financial crime;
  • Fraud with European funds;
  • Cybercrimes in the digital era;
  • Fintech, cryptocurrency, and financial crime;
  • The effects of economic and financial crimes on economic and sustainable development;
  • Fraud, performance, and failure risk;
  • The effects of the COVID-19 pandemic on financial crimes;
  • Methods to protect against financial crimes.

Prof. Dr. Monica Violeta Achim
Guest Editor

Manuscript Submission Information

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Keywords

  • frauds
  • corruption
  • tax evasion
  • cybercrime
  • money laundering
  • shadow economy

Published Papers (9 papers)

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Research

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Article
Corruption, Shadow Economy and Deforestation: Friends or Strangers?
Risks 2021, 9(9), 153; https://doi.org/10.3390/risks9090153 - 25 Aug 2021
Viewed by 694
Abstract
This study aims to reveal the connection between corruption and shadow economy, on one hand, and deforestation, on the other. The research considers 131 countries from all over the world, in the timeframe between the years 2012 and 2020, and it reveals that [...] Read more.
This study aims to reveal the connection between corruption and shadow economy, on one hand, and deforestation, on the other. The research considers 131 countries from all over the world, in the timeframe between the years 2012 and 2020, and it reveals that corruption and shadow economy positively influence deforestation. Determinants like democratic governance quality, press freedom, wood export share, and culture are also key factors in implementing the right, efficient countermeasures aimed at reducing the levels of illegal deforestation and sustainably managing the forestland. The importance of this study is to provide a solid quantitative basis to decision-makers that come across this problem of illegal logging through a better, fact-based understanding of the phenomenon. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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Article
Bibliometric Analysis of the Literature on Measuring Techniques for Manipulating Financial Statements
Risks 2021, 9(7), 123; https://doi.org/10.3390/risks9070123 - 01 Jul 2021
Viewed by 684
Abstract
Creative accounting has its background since early studies in 1975, until the present time. It continues to be a subject of great interest for the companies and interested parties. Thus, the current paper will aim to answer the following proposed research questions: 1. [...] Read more.
Creative accounting has its background since early studies in 1975, until the present time. It continues to be a subject of great interest for the companies and interested parties. Thus, the current paper will aim to answer the following proposed research questions: 1. Which are the most used methods for detecting the manipulation of financial statements in the literature? 2. Which are the terms that are most frequently encountered in the literature associated with “creative accounting? 3. Which are the journals that have the highest frequency of articles written on the topic “creative accounting”? 4. Over time, how did research evolve in the field of creative accounting? 5. Which countries are most preoccupied in publishing regarding this topic? To answer the research question 1, the models published in the literature for measuring manipulation techniques through creative accounting were reviewed and analyzed. For the remaining research questions, a bibliometric analysis for the publications in this area was performed. For collecting the sample, articles on this topic were selected from the international Web of Science database. Following this, a bibliometric analysis of the articles was performed, using the VOSviewer program. A total of 4045 publications on creative accounting were identified. Through the bibliometric analysis we have answered research question 2, by identifying the key words that have the closest proximity to creative accounting. To answer the remaining research questions, we identified the journals with the highest frequency of publication and the countries with the highest interest on the topic. It is especially important to evaluate the quality of this many research papers and to obtain valuable information. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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Article
Economic and Non-Economic Variables Affecting Fraud in European Countries
Risks 2021, 9(6), 119; https://doi.org/10.3390/risks9060119 - 17 Jun 2021
Viewed by 1231
Abstract
Fraud is one of the most harmful phenomena, because it leads to collapse of organizations, causes economic downfall of countries, and destroys faith in a country’s capital markets. The impact of fraud is complex and has varying degrees depending on political and financial [...] Read more.
Fraud is one of the most harmful phenomena, because it leads to collapse of organizations, causes economic downfall of countries, and destroys faith in a country’s capital markets. The impact of fraud is complex and has varying degrees depending on political and financial institutional structures of a country. In this paper, we investigate the combined effect of economic and non-economic variables on fraud using a sample of 41 developed, in transition, and developing European countries. The data cover the period July 2014–December 2020. Panel data techniques of pooled estimation and the dynamic panel data/generalized method of moments (DPD/GMM) is used, keeping in view the endogeneity perspective. Nevertheless, two-way impacts of fixed effect model estimation—cross-sectional and time-based (panel) effects (alternatively)—are used for analyzing the relationship among the given variables, based on Hausman specification test results. Empirical results of panel data extended REM and FEM approaches with country-specific cross-sectional effects showing that political stability, economic freedom, poverty, and GDP significantly affect fraud proliferation. Political stability is appraised to be the most scoring determinant of fraud incidence in a country. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
Article
A Statistical Model of Fraud Risk in Financial Statements. Case for Romania Companies
Risks 2021, 9(6), 116; https://doi.org/10.3390/risks9060116 - 10 Jun 2021
Viewed by 696
Abstract
Tax avoidance is one of the most frequent reasons for which companies tend to resort to creative accounting techniques. The purpose of the study is to identify which of the eight-variables from the Beneish influences the most or least the outcome of the [...] Read more.
Tax avoidance is one of the most frequent reasons for which companies tend to resort to creative accounting techniques. The purpose of the study is to identify which of the eight-variables from the Beneish influences the most or least the outcome of the final score, as a percent, by developing a statistical model. The sample was selected from the Bucharest Stock Exchange and consists of 66 companies traded on the main market, for the years 2015–2019. The results show that from the total of the eight variables, GMI (Gross Margin Index), AQI (Asset Quality Index), DEPI (Depreciation Index) and TATA (Total Accruals to Total Assets) are significantly influencing the probability to commit fraud. The developed model is validated with only 10% of the non-fraud companies being mistakenly considered as fraud based on our model and vice versa. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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Article
Privacy Intrusiveness in Financial-Banking Fraud Detection
Risks 2021, 9(6), 104; https://doi.org/10.3390/risks9060104 - 01 Jun 2021
Cited by 1 | Viewed by 898
Abstract
Specialty literature and solutions in the market have been focusing in the last decade on collecting and aggregating significant amounts of data about transactions (and user behavior) and on refining the algorithms used to identify fraud. At the same time, legislation in the [...] Read more.
Specialty literature and solutions in the market have been focusing in the last decade on collecting and aggregating significant amounts of data about transactions (and user behavior) and on refining the algorithms used to identify fraud. At the same time, legislation in the European Union has been adopted in the same direction (e.g., PSD2) in order to impose obligations on stakeholders to identify fraud. However, on the one hand, the legislation provides a high-level description of this legal obligation, and on the other hand, the solutions in the market are diversifying in terms of data collected and, especially, attempts to aggregate data in order to generate more accurate results. This leads to an issue that has not been analyzed yet deeply in specialty literature or by legislators, respectively, the privacy concerns in case of profile building and aggregation of data for fraud identification purposes and responsibility of stakeholders in the identification of frauds in the context of their obligations under data protection legislation. This article comes as a building block in this direction of research, as it contains (i) an analysis of existing fraud detection methods and approaches, together with their impact from a data protection legislation perspective and (ii) an analysis of respondents’ views toward privacy in case of fraud identification in transactions based on a questionnaire in this respect having 425 respondents. Consequently, this article assists in bridging the gap between data protection legislation and implementation of fraud detection obligations under the law, as it provides recommendations for compliance with the latter legal obligation while also complying with data protection aspects. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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Article
The Impact of the Development of Society on Economic and Financial Crime. Case Study for European Union Member States
Risks 2021, 9(5), 97; https://doi.org/10.3390/risks9050097 - 18 May 2021
Viewed by 752
Abstract
Economic and financial crime is closely related to the changes and the development of societies. In this paper, we question whether the types of economic and financial crimes change as the society develops or not. For our purpose, we use the sample of [...] Read more.
Economic and financial crime is closely related to the changes and the development of societies. In this paper, we question whether the types of economic and financial crimes change as the society develops or not. For our purpose, we use the sample of 27 European Union member countries, for the 2005–2020 time period, which forms an unbalanced panel dataset. The main econometric method is represented by the Pooled OLS method for panel data. Our findings highlight that higher economic and sustainable development determines a reduction in the levels of corruption, shadow economy, and cybercrime. Additionally, we find that increased economic and sustainable development is related to higher levels of money laundering. These findings help governments to understand the way in which various types of economic and financial crimes unfold within different contexts of economic development, in order to implement specific policies for reducing the general level of crimes. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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Article
Cardless Banking System in Malaysia: An Extended TAM
Risks 2021, 9(2), 41; https://doi.org/10.3390/risks9020041 - 15 Feb 2021
Viewed by 1088
Abstract
The main objective of this study is to analyse consumers’ behavioural intentions to use cardless banking technology in Malaysia. The intentions to use this technology are evaluated through an extended Technology Acceptance Model (TAM) framework. The data were collected from 447 Maybank and [...] Read more.
The main objective of this study is to analyse consumers’ behavioural intentions to use cardless banking technology in Malaysia. The intentions to use this technology are evaluated through an extended Technology Acceptance Model (TAM) framework. The data were collected from 447 Maybank and Hong Leong Bank customers in Selangor and Kuala Lumpur. The results show that self-efficacy (SE) had a positive impact on the perceived ease of use (PEOU), while perceived risk (PR) had a negative impact on perceived usefulness (PU) and intention to use (IU) cardless banking. Next, the perceived ease of use (PEOU) had a positive impact on perceived usefulness (PU). The results further support the idea that perceived usefulness (PU) and perceived ease of use (PEOU) had the strongest impacts on intention to use (IU). The practical implications of this study suggest that developers of cardless banking technology should introduce secure, less complicated, and easily accessible technology to improve consumers’ intentions to use. The perceived usefulness of this technology can be improved through promotional strategies and consumer training. Theoretically, this study has successfully extended TAM in the context of cardless banking technology in Malaysia. Moreover, this study will assist bankers in designing effective marketing strategies to attract more customers, which will add significant value to the overall business of the banking industry. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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Review

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Review
Efficiency of Money Laundering Countermeasures: Case Studies from European Union Member States
Risks 2021, 9(6), 120; https://doi.org/10.3390/risks9060120 - 17 Jun 2021
Viewed by 746
Abstract
The aim of this study is to present the trends and effectiveness of money laundering countermeasures from the perspective of a number of suspicious transactions reported to the Financial Intelligence Units (FIUs), a number of analysis results submitted to law enforcement authorities, and [...] Read more.
The aim of this study is to present the trends and effectiveness of money laundering countermeasures from the perspective of a number of suspicious transactions reported to the Financial Intelligence Units (FIUs), a number of analysis results submitted to law enforcement authorities, and the typologies of cases in European Union Member States. In order to determine the impact of the joint effort in the fight against money laundering, we used descriptive statistics to process the data and case studies from annual reports of the European FIUs for 2018 and 2019. The results of our study highlight the increase in the number of suspicious transactions notices, as well as in their quality level. There is an increasing tendency towards information exchange between European Union countries regarding the suspicion of money laundering, but there is no stable trend for referring cases to law enforcement and other responsible institutions. Based on the available data, it can be concluded that the EU anti money laundering measures are efficient, but further steps are needed to achieve higher international coordination and cooperation. Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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Other

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Book Review
Economic and Financial Crime: Corruption, Shadow Economy, and Money Laundering: Book Review. Written by Monica Violeta Achim and Sorin Nicolae Borlea. Springer Nature: Cham, Switzerland, 2021. ISBN 978-3-030-51780-9
Risks 2021, 9(4), 71; https://doi.org/10.3390/risks9040071 - 10 Apr 2021
Viewed by 866
Abstract
The authors Monica Violeta Achim and Sorin Nicolae Borlea structured their book entitled “Economic and Financial Crime: Corruption, shadow economy, and money laundering” in four major parts [...] Full article
(This article belongs to the Special Issue Economic and Financial Crimes)
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