Impacts of psychological behaviors of managers on money laundering: evidence from Iran stock exchange

Abstract

Purpose

This study aims to investigate the impacts of the psychological behaviors of managers, including entrenchment, myopia, narcissism and overconfidence, on money laundering at Iranian companies listed on the Tehran Stock Exchange.

Design/methodology/approach

The present study is descriptive-correlational in terms of methodology and applied research in terms of objectives. The statistical population consisted of all companies listed on the Tehran Stock Exchange during 2013–2019. A total of 150 companies were selected as samples via screening. Logistic regression was used to analyze the data and test the hypotheses in EViews v10.

Findings

The findings revealed that management entrenchment, managerial myopia, managerial narcissism and managerial overconfidence have significant impacts on money laundering.

Originality/value

This study pioneer investigating the impacts of psychological behaviors among managers on money laundering in Iran. As an economic crime, money laundering poses an adverse impact on economic growth in countries. The continuous monitoring of manager performance and the deployment of performance measurement systems could prevent the negative impacts of manager behavior on money laundering.

Citation

Saeidi, H. (2022), "Impacts of psychological behaviors of managers on money laundering: evidence from Iran stock exchange", Journal of Money Laundering Control, Vol. 25 No. 1, pp. 206-223. https://doi.org/10.1108/JMLC-01-2021-0001