The Association between the Corporate Governance and Bank Fraud

• Main Authors: Wan Ting Chen, 陳婉婷
• Other Authors: 盧鈺欣
• Format: Others
• Language: zh-TW
• Published: 2014
• Online Access: http://ndltd.ncl.edu.tw/handle/54698650552845808679

碩士 === 逢甲大學 === 會計學系 === 102 === From the International Security Corp of illegal loans to the Chung Shing Bank embezzlement of sports lottery scandal, the fraud indicates that the inefficiency of internal controls cause from weakness of corporate governance. In order to response a series of corporate scandals, corporate governance facility is considered a good remedy. Prior literature explored the relationship between the corporate governance and the corporate fraud focus on general industries. However, the weakness of corporate governance is not limited to specific companies, and the performance of corporate governance should not be limited to a general industry. American Association of Certified Fraud Examiners (ACFE) pointed out that all industries, the most frequent occurrences of fraud exist in the banking industry. This study focuses on the banking industry to explore whether the weakness of corporate governance result in the inefficiency of internal controls and bank fraud. At first, this study explores literature related to corporate governance in general industries identify and investigate the variables associated bank industry. Then, this research uses the sample from 2005 to 2013 to compare the difference of corporate governance between fraud band and non-fraud band. Finally, the study employs logistic regression analysis to examine the association between the corporate governance and bank fraud. The empirical results shows that the proportion of independent directors and blockholder shareholding exit significant difference consistent with Beasley (1996) that when the lower of the ratio of outside directors and independent directors, the higher the likelihood of the occurrence of fraud in the enterprise. In addition, the results are consistant with Shleifer and Vishny (1986) that the existence of large shareholders will reduce information asymmetry, moral crisis problems, fraud management authorities, and increase the value of the company.