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The purpose of this study is to examine the risks of the metaverse ecosystem. This study provides an overview of the metaverse and its evolution and discusses the various fraud risks it poses for organizations (including boards of directors, forensic accountants, auditors and accountants). Given the advantages of the metaverse and the growing interest it is attracting from organizations, this paper sheds light on the importance of mitigating its risks.

Based on a systematic review of the literature on the metaverse and analysis of the fraud triangle, this study examines the different fraud risks it poses. More specifically, this study analyzes 21 articles on the metaverse published between 2021 and 2022 and attempts to answer the following research questions: What are the risks inherent in the metaverse? What are the fraud risks associated with it? What are the opportunities and pressures it brings? What is the rationalization underlying its use? This study conducts the analysis on two levels, that of the individual (user) and that of the organization. This paper summarizes the findings of publications on the metaverse in 2021 and 2022 to discover its various definitions and the opportunities and risks it represents.

This paper offers an insightful discussion of the advantages and risks the metaverse can bring. Because this analysis shows that any organization could be vulnerable to metaverse risks, this study provides organizations with strategies to deter, detect and prevent fraud and reputational risks. Regulatory bodies, financial authorities, board of directors and fraud investigators should all consider these risks before investing in the metaverse.

This paper adds new insights to the scarce research on the metaverse and cybersecurity by exploring the opportunities and risks it presents. It has several implications for organizations, boards of directors, management and regulatory authorities.

The purpose of this paper is to focus on managing the risk of fraud in commercial letters of credit (LC) in Bangladesh involving three parties: the seller, the buyer and the bank. It addresses the severity of LC fraud, the banks’ actions when detected and the preventive measures the relevant parties can adopt.

This research uses doctrinal and qualitative methods to propose strategic actions that benefit buyers, sellers, banks, legal professionals and judges. The study aims to explore the modus operandi used by fraudsters through thematic analysis.

The study’s findings reveal that LC fraud has escalated to a concerning level, posing a significant threat to the economic stability of Bangladesh. Measures must be taken to mitigate this risk and safeguard the country’s financial integrity. To effectively combat the risk of LC fraud, the updated version of UCP must include specific and detailed guidelines on LC fraud. This study recommends preventative measures that all parties involved must take to reduce the likelihood of fraud significantly.

Due to a lack of LC experts, the participant sample for the study in Bangladesh was limited. Nevertheless, most banking participants were highly distinguished and held the Head of Trade Finance Department position in commercial banks. A few academics and legal practitioners with LC expertise also participated in the study.

It provides cutting-edge solutions to effectively handle LC fraud risk and provides proactive measures to prevent it.

Although corporations exert considerable efforts to uphold ethical standards in their business operations, fraud instances persist as an enduring and formidable challenge within organisations, defying their utmost efforts. The presence of fraud poses a substantial and recurring threat to corporations, leading to significant financial losses on an annual basis. This emphasises the crucial need for a comprehensive understanding of the factors contributing to fraudulent activities and the intricate nature of fraud risk factors inherent in business operations. Therefore, this paper aims to enhance the efficacy of fraud detection and prevention measures through critical analysis and refinement of established fraud theories, drawing upon the existing literature on this subject matter.

This paper offers a comprehensive qualitative analysis of the existing literature, thoroughly reviewing prominent models that aim to elucidate the underlying motivations behind fraudulent behaviour. Moreover, drawing upon the existing theoretical foundation, this study conceptualises a model that enhances the understanding of the crucial factors contributing to fraudulent behaviour.

The study presents new theoretical insights concerning the role of personal integrity in fraudulent decision-making, presenting refined interventions that enhance comprehension of the underlying drivers of fraud occurrences and strategies for prevention. Furthermore, the study reveals a comprehensive three-part approach to improving organisational health through strengthening compliance mechanisms and cultivating an ethical-values-based culture.

The study introduces a novel conceptual framework, the personal ethic-based fraud motivation model, which offers a deeper understanding of the factors and conditions influencing individuals’ propensity to engage in fraudulent activities. Furthermore, this study presents a three Cs strategy that effectively delineates the influential forces that drive individuals to surmount fraud risks.

This study reviews and discusses the accounting literature that analyzes the role of auditors and enforcers in the context of fraud.

This literature review includes both qualitative and quantitative studies, based on the idea that the findings from different research paradigms can shed light on the complex interactions between different financial reporting controls. The authors use a mixed-methods research synthesis and select 64 accounting journal articles to analyze the main proxies for fraud, the stages of the fraud process under investigation and the roles played by auditors and enforcers.

The study highlights heterogeneity with respect to the terms and concepts used to capture the fraud phenomenon, a fragmentation in terms of the measures used in quantitative studies and a low level of detail in the fraud analysis. The review also shows a limited number of case studies and a lack of focus on the interaction and interplay between enforcers and auditors.

This study outlines directions for future accounting research on fraud.

The analysis underscores the need for the academic community, policymakers and practitioners to work together to prevent the destructive economic and social consequences of fraud in an increasingly complex and interconnected environment.

This study differs from previous literature reviews that focus on a single monitoring mechanism or deal with fraud in a broadly manner by discussing how the accounting literature addresses the roles and the complex interplay between enforcers and auditors in the context of accounting fraud.

The study aims to explore the reasons behind external auditors' failure to detect and report fraud.

Semi-structured interviews were conducted with twenty-four experienced Big 4 auditors.

The present study reveals power issues within audit firms and how some dishonest audit partners deal with auditors' concerns at the higher echelons. It also shows how auditors are pressured and intimidated by audit clients when fraud-related issues are raised. Further, it sheds light on ethical, governance and regulatory issues inhibiting auditors’ ability to detect or report fraud.

This study advances the audit literature by adding practice-based evidence on why external auditors fail to discover fraud.

The results draw policymakers' attention to the issues that inhibit external auditors' ability to discover fraud in practice which could help policymakers develop effective interventions. Additionally, it provides several recommendations which could aid policymakers and audit firms in designing effective audit reforms to resolve the fraud detection deficit.

This is the first study exploring external auditors' views on their failure to detect and report fraud and how the conflict of interests operates in the audit practice.

This study expands the empirical understanding of financial fraud victims and the consequences that emerge as a result of financial fraud victimization. In addition, this study aims to assess the impact of the unique role victims play in financial fraud and the impact self-identifying as a victim has on the negative consequences they experience.

Data from the Supplemental Fraud Survey to the National Crime Victimization Survey are used to assess the negative consequences of financial fraud victimization.

Results suggest that victims of financial fraud experience increased distress and financial complications following their victimization experience. In addition, self-reported victim status is found to significantly increase a respondent’s likelihood of reporting emotional distress and financial complications. Implications for research, theory and policy are discussed.

While empirical studies on the consequences of identity theft victimization have been increasing in recent years, financial fraud victimization remains understudied. Given the victim involvement in financial fraud, the consideration of financial fraud independent of identity theft fraud is vital.

The purpose of this study is to discuss the harmful use of deepfakes in an organizational context, based on the only two cases the authors found that were addressed by the media from the perspective of corporate fraud. This study offers an overview of deepfake technology, and in particular, examines five W questions to better decipher the impact of these tools on organizations: What is deepfake? Who is the fraudster and who is targeted? Why use them and how? And What after? Based on these five W questions, this study provides an in-depth discussion of the two cases identified. Even though this technology has several advantages, this study examines its dark side.

Using comparative analysis, the authors study the only two known and publicized fraud cases by using deepfakes that have targeted chief executive officers to date.

The paper provides an extensive picture of the unethical and illicit use of deepfakes in an organizational context and discusses how this technology could affect fraud risk. In addition, the analysis of cases shows that voice-generating software, combined with other fraud schemes such as business email compromise, facilitates the commission of the fraud, as the victims feel confident because they recognize the speaker’s voice and emails. The analysis shows that any organization could be vulnerable to this technology. The median costs of this type of fraud can be high. For the two cases identified, the estimated losses amounted to US$243,000 and US$35,000,000, respectively.

This paper adds new insights to the scarce research on deepfakes and financial crime by investigating the causes and consequences of the unethical and illicit use of deepfakes. It has several implications for organizations, boards of directors, management and regulatory authorities.

This study aims to examine how auditors perceive the influence of crucial fraud prevention factors in deterring financial statement fraud within the corporate sector. Additionally, this research explores the mediating effect of fraud awareness in elucidating the impact of ethical leadership and internal control systems on preventing financial statement fraud.

The study used an online survey, targeting a sample of 141 professionally qualified auditors with at least one year of practical experience in the field. The researchers used “Structural Equation Modeling (SEM)” to examine relationships between latent variables using partial least squares structural equation modeling. The study investigated the impact of whistleblowing systems, fraud awareness, ethical leadership, internal control systems and corporate governance on fraud prevention.

This research finding provides evidence to the corporate sector by establishing the significance of fraud awareness as the most influencing factor in preventing financial statement fraud. Furthermore, the combined explanatory variables account for 77.4% of the overall variance in financial statement fraud prevention. The study reveals a partial mediation effect of fraud awareness on the relationship between the internal control system and financial statement fraud prevention.

This research finding may assist in developing an effective fraud prevention programme to mitigate fraud instances and improve financial reporting quality. In the corporate sector, each organisation should clearly specify the policies on whistleblowing systems, fraud awareness training, internal control systems and corporate governance. To foster a comprehensive fraud prevention programme, the leaders should enforce these policies with employee support.

This research integrated crucial elements to develop a new theoretical framework for investigating financial statement fraud prevention within the corporate context. Accordingly, this research framework provides a more in-depth explanation of preventing financial statement fraud from an auditor’s perspective. Additionally, this research is the first to explore the mediating role of fraud awareness in influencing the effectiveness of the internal control system in preventing financial statement fraud.

Using a qualitative grounded theory approach, this study explores the methods experienced external auditors use to detect fraudulent financial reporting (FFR) during standard audits.

Semi-structured interviews were conducted with 24 experienced external auditors to explore the methods they used to detect FFR successfully during standard external audits.

The authors find 58 methods used for FFR detection, out of which the following methods are frequently used and help in detecting more than one type of FFR: (1) specific analytical procedures, (2) positive confirmation, (3) understanding of the client's business and industry, (4) the inspection of specific documents, (5) a detailed analysis of the audit client's anti-fraud controls and (6) investigating tip-offs from suppliers, employees and customers.

Based on the grounded theory approach, the authors theorise that auditors must return to the basics and focus on specific audit procedures highlighted in this study for effective fraud detection.

The study provides practical guidance, including 58 methods used in audit practice to detect FFR. This knowledge can improve auditors' skills in detecting material misstatements due to fraud. Besides, analytical procedures and positive confirmation helped external auditors in this study detect all forms of FFR, yet they are overlooked in the external audit practice. Therefore, audit firms should emphasise the significance of these audit procedures in their professional audit training programmes. Audit regulators should advise auditors to consider positive confirmation instead of negative confirmation in financial audits to increase the likelihood of FFR detection. Moreover, audit standards (ISA 240 and SAS 99) should explicitly require auditors to conduct a detailed analysis of the client's anti-fraud controls.

This is the first study to identify actual, effective methods used by external auditors in detecting FFR during the ordinary course of an audit.

This paper aims to investigate the perceptions of financial accountants and both internal and external auditors regarding the impact of corporate governance (CG) and information technology (IT) on the detection and prevention of fraud within organizations.

Primary data were collected from 250 financial accountants, internal auditors and external auditors through questionnaires. The non-probability snowball sampling technique was used for data collection, with the sample t-test, one-way ANOVA and paired sample t-test applied for analysis.

The results indicate that robust CG practices and IT techniques significantly aid in detecting and reducing fraudulent activities by minimizing opportunities, rationalizations, pressures and capabilities of potential employees to commit fraud. Internal controls also play a significant role in reducing instances of fraud. Notably, ethical officers and ethical training were not perceived as significantly effective in preventing and detecting fraud, leading to a perception that fraudulent practices are prevalent and increasing the risk of future fraudulent activities.

This study recommends the adoption of strong CG practices to identify potential fraud within an organization. Moreover, IT techniques should be tailored to specific needs for effective utilization. Furthermore, the government should increase awareness regarding data provision by departments, organizations and other related personnel. Future research could use secondary data from various regions to expand the literature in this field.

This research uniquely combines three significant factors: CG, IT and forensic accounting in fraud detection and prevention. It contributes to the enhancement of literature about fraud and its preventive and detective measures. The results of this study set the seed for future research, government policymaking and enhanced organizational practices.