Corruption in the Oil and Gas Industry : Implication for Economic Growth

Donwa, P.A.; Mgbame, Chijoke Oscar; Julius, Onivehu

doi:10.12816/0017678

Cited by 22 publications

(23 citation statements)

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“…In addition, some of the circumstances that indicate the possibility that the financial statements contain a material misstatement resulting from fraud include: Last minute adjustments that significantly affect financial results, followed by transactions that are not recorded in a complete or timely manner or that are incorrectly recorded in terms of their amount. On the other hand, the finding in [22] demonstrates that there is a moderate presence of corruption in commercial companies in industrial companies, also arguing that the level of corruption has a significant impact on the growth of the economy, which implies that the economy cannot grow rapidly without zero tolerance on corruption.…”

Section: Resultsmentioning

confidence: 99%

Estimation of financial fraud present in industrial and commercial companies

Padilla¹,

Martelo²,

Villabona³

2018

IJET

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The objective of the present investigation was to analyze the financial fraud in the companies of the industrial and commercial sector in the city of Cartagena, Colombia, for which the most common types of fraud were identified, the necessary conditions for the materialization of the fraud were described and It was determined how is the miso risk management. The type of research was classified as descriptive, field, with no experimental, transactional design. Descriptive statistics was used for data analysis. The results show that financial fraud in the analyzed organizations has a moderate presence of some type of fraud, and of the risk factors, as well as a low presence of risk management mechanisms, which allows inferring that there is a low capacity to face it. It is concluded that financial fraud can occur in the companies studied due to the deficiency of the general conditions of control of the same. Keyword-Risk Factors, Risk Management, Types Of Frauds, Fraud Control, Economic Crimes I. INTRODUCTION Financial fraud is one of the main concerns worldwide that often produces destructive results and is growing rapidly in many countries. This refers to activities, such as credit card fraud, money laundering, insurance fraud, corporate fraud, among others. It is a criminal act that violates the law, regulations or policy to obtain an unauthorized financial benefit [1]. In the case of corporate fraud, it involves three categories: misappropriation of assets, corruption and fraudulent financial statements [2]. The misappropriation of assets includes the theft or misuse of the assets of an organization [3]. In corruption, employees use their influence in commercial transactions to obtain unauthorized benefits against their duties for employers [4]; and in fraudulent financial statements, it implies that the reported financial statements look better than they really are [5]. In this sense, the Association of Certified Fraud Examiners [6] states that in the period from January 2014 to October 2015, 2,410 reported cases of fraud were analyzed, concluding that because of this, companies lose 5% of their annual income, which translates into 6.3 trillion US dollars (USD), a significantly high figure considering that 40.7% of victim organizations do not file complaints about fraud cases, because 75% of the cases are conceived and executed by people associated with the organization. In the Specific case of Colombia, [7], indicates that about 49% of the companies subject to a study were victims of financial fraud, estimating that the losses reach 95 million American Dollars. Due to the above, financial fraud is one of the most evaluated topics worldwide and the literature shows this as in [8], where the mediating roles of the ethical culture and the monitoring control between the link organizational investment and labor fraud. Similarly, [9] analyzes the ways in which fraud was committed and the techniques used to detect them in a local case, where the best tools chosen were the benefits model and the analysis of reasons, ...

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Section: Resultsmentioning

confidence: 99%

Estimation of financial fraud present in industrial and commercial companies

Padilla¹,

Martelo²,

Villabona³

2018

IJET

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“…In one of the of the high profile embezzlement cases in the extractive industry for all crude oil sales within the period of 2012 and July 2013 the NNPC (Nigerian National Petroleum Corporation) paid only 24 % proceeds into the federation account, and diverted the remaining 76 % which cannot be accounted for resulting in unremitted misappropriated fund totaling US $20 billion. (Omitaomu, 2014 cited in Donwa et al, 2015).…”

Section: Journal Of Public Administration and Governancementioning

confidence: 99%

A Comparative Study of Corruption in the Extractive Industries of Nigeria and Botswana: Lessons that can Be Learnt by the Young African Country of Eritrea

Desta¹

2020

JPAG

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This article examines the nature of corruption in the extractive industries of two Sub-Saharan countries, namely Nigeria and Botswana. It explained the root causes of the high levels of corruption present in the case of oil and gas-rich Nigeria and the reasons that account for the minimal levels of corruption prevailing in diamond-rich Botswana. This article identified corrupt political leadership; the legacy of the divide and rule policies introduced by the former British colonial masters; lack of transparent and accountable public institutions, political patronage networks; poverty-driven desire to meet the basic necessities of life; massive inflows of petrodollars producing the “resource curse”; chronic political disruptions characterized by several military coups; the supremacy of familial, ethnic and religious loyalties over national interest and poor public sector pay as the main drivers of pervasive corruption in Nigeria. On the other hand the primary factors that contributed to the remarkable achievement of Botswana in the fight against corruption include ethical political leadership; sound pre-independence traditional institutions; relatively homogenous population; respect for rule of law and property rights; high degree of transparency; cultural intolerance to graft, establishment of democratic institutions at independence; good economic management; ability to manage ethnic diversity; and a competent, a meritorious bureaucracy. This article also identified the key elements of anticorruption strategy that would help prevent and combat corruption as well enhance integrity in the Eritrean public sector based on the experiences of Nigeria and Botswana. They include sound ethical political leadership; transparency and accountability in government; merit-based and adequately paid civil service; independent, empowered and well-resourced anticorruption commission; and prudent natural resource management.

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“…An array of issues 3 are affecting the gas sector in Nigeria, and in turn the potential domestic energy and economic development. Behind the poor outcomes of the country vis-à-vis the abundance of energy resources, the literature (Osuoka 2007;Agbiboa 2012;Donwa et al 2015;…”

Section: Main Issues and Challenges For The Sectormentioning

confidence: 99%

The Changing Role of Natural Gas in Nigeria

Occhiali

Falchetta

2018

SSRN Journal

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Nigeria is endowed with substantial amounts of energy resources, and it has been making large profits from their export. However, windfall revenues have also been affecting the Government's responsiveness and accountability, and they have brought it into collusive relationship with international oil and gas companies operating in the country. A skewed distribution of petroleum resources costs and benefits, as well as the dependence on exports exposing the public finances to volatility in the international markets have represented further major issues. As a result, in spite of the resource abundance, energy access and power generation still represent urgent issues for action in the country. Solid biomass accounts for 74% of the primary energy consumption, while the electrification rate stands at 34% in rural areas. Active power plants are mainly gas-fired, but they face capacity, maintenance, and financial constraints. While historically natural gas has been disregarded or flared into the atmosphere because it was considered a by-product of oil due to lacking market conditions and processing capacity, today the development of a domestic market for natural gas is seen as a key priority to guarantee energy security and boost industrial development in Nigeria. A more efficient and equitable governance of the sector and management of export revenues can play a major role in this sense. In this context, this paper highlights the main current issues and underpins key policy conditions for this transition to take place in Nigeria Abstract Nigeria is endowed with substantial amounts of energy resources, and it has been making large profits from their export. However, windfall revenues have also been affecting the Government's responsiveness and accountability, and they have brought it into collusive relationship with international oil and gas companies operating in the country. A skewed distribution of petroleum resources costs and benefits, as well as the dependence on exports exposing the public finances to volatility in the international markets have represented further major issues. As a result, in spite of the resource abundance, energy access and power generation still represent urgent issues for action in the country. Solid biomass accounts for 74% of the primary energy consumption, while the electrification rate stands at 34% in rural areas. Active power plants are mainly gas-fired, but they face capacity, maintenance, and financial constraints. While historically natural gas has been disregarded or flared into the atmosphere because it was considered a by-product of oil due to lacking market conditions and processing capacity, today the development of a domestic market for natural gas is seen as a key priority to guarantee energy security and boost industrial development in Nigeria. A more efficient and equitable governance of the sector and management of export revenues can play a major role in this sense. In this context, this paper highlights the main current issues and underpins key policy conditions for this...

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Corruption in the Oil and Gas Industry : Implication for Economic Growth

Cited by 22 publications

References 0 publications

Estimation of financial fraud present in industrial and commercial companies

Estimation of financial fraud present in industrial and commercial companies

A Comparative Study of Corruption in the Extractive Industries of Nigeria and Botswana: Lessons that can Be Learnt by the Young African Country of Eritrea

The Changing Role of Natural Gas in Nigeria

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