Effects of Fraud Investigative Practice on Fraud Detection and Prevention among County Governments in the Rift Valley Region, Kenya

Abstract

Fraud has become a major menace in Kenya’s county governments since the inception of county governments in 2013. It has caused large economic losses which have not been recovered to date as the cases are still pending in courts. The number of complete investigated cases in the EACC Annual Report 2020/2021 was 30 out of which 18 belonged to Executive and County Assemblies of various County Governments in Kenya. Fraud detection and preventive measures seem not to be working as more funds are being lost as indicated by the current reports of the auditor general, therefore, the objective of the study was to determine the effect of fraud investigative practice on fraud detection and prevention among county governments in the Rift Valley Region in Kenya. The main theory underpinning the study was the fraud diamond theory. An explanatory research design was used in this study. The target population comprised 217 accountants and internal auditors in the finance and economic planning department in the county governments in the Rift Valley Region in Kenya. Census technique was applied to solicit data from the entire population since the population is relatively small and accessible. The study collected primary data using questionnaires. Data was analyzed using inferential statistics by use of correlation and regression analysis. The study results showed a positive and significant effect (b =0.567; p= 0.000) of fraud investigative practice on fraud detection and prevention. The study concluded that fraud investigation practices have a clear and considerable positive impact on fraud detection and prevention. Strengthening investigative practices strengthens county governments' ability to discover and deter fraudulent actions, thus boosting openness, accountability, and the general integrity of financial operations. The study findings inform policy makers in formulating policies that can enhance fraud detection and prevention in county governments in Kenya through fraud investigative practices. Also, the findings are useful to scholars because the results contribute to literature in relation to fraud investigative practices and fraud detection and prevention.