Preventing Fraud and Strengthening Integrity: A Case Study From North Sumatera, Indonesia

The purpose of this research is to determine the influence of the fraud triangle elements and integrity on fraud and to investigate the factors affecting integrity as well as to discover strategies to strengthen fraud prevention and integrity in Indonesia.This study concentrates on North Sumatra Province, which has the maximum number of fraud cases in Indonesia in comparison to other provinces.Data were gathered by distributing questionnaires to individuals who were considered to possess knowledge and authority in the field of finance.Responses to the questionnaire were acquired from 179 respondents, and the data collected served as the research sample.Multiple regression analysis was implemented in phases to analyses the data.The research results indicate that the elements of the fraud triangle-pressure, opportunity, and rationalization-have a positive and substantial influence on fraud, whereas integrity has a negative impact on fraud.This research also indicates that integrity is significantly and positively influenced by familial, educational, and social environments.This research offers intriguing suggestions for enhancing the prevention of fraud and the preservation of integrity in Indonesia.It does so by regulating the components of the fraud triangle through psychological assistance programs, the implementation of whistle-blowers through anonymous reporting, the reinforcement of integrity, and strong law enforcement.Additionally, the development of individual integrity should be implemented in the family environment from a young age and furthered in educational and community environments.