Understanding fraud in Malaysian SMEs

Abstract

Purpose The paper aims to provide an overview of fraud risk among Malaysian small- and medium-sized enterprises (SMEs). In particular, the authors investigate the understanding of SME owners and managers on fraud schemes and the usage of antifraud measures. Design/methodology/approach A sample of 126 Malaysian SMEs from different industries participated in this study. Findings The results suggest that Malaysian SMEs are exposed to a broad range of fraud schemes, yet few take actions to prevent these frauds. Practical implications The findings should be useful to academic researchers, entrepreneurs, regulators and others who are interested in understanding the fraud risk in small businesses. Originality/value This study extends and contributes to prior literature by linking the state of fraud and SMEs in developing countries.