| dc.description.abstract | At the mention of the word fraud one immediately thinks of the various scandals that have rocked this
country, in fact one can say that corporate fraud has now become endemic. ] udging from the world wide
perspective, Kenya is no exception ton to this new phenomenon to hit the financial world like a storm.
The famous Ponzi scheme perpetuated by one Bernard Madoff; caused ripples in the United States
economy. It is believed that Madoff caused losses of almost $65 billion to his investors. The former
NASDAQ2 chairman, who headed his stock brokerage firm Bernard MadoffLLC, is said to have begun this
scheme in the early 1980's. Unsuspecting investors lost billions of dollars in what was described as one of
the biggest fraud in recent history. Much closer home a similar story is told of the stock brokerage firm,
Nyaga stockbrokers. The firm went under when it was discovered that it traded in their clients' shares
without their consent. Soon after, Discount Securities Limited also collapsed.
Corporate fraud however is not limited to securities fraud but it involves a broad spectrum of activities
including deception, embezzlement, corruption, bribery, forgery, extortion, collusion, theft, conspiracy,
misappropriation, concealment of material facts and false representations.' Basically fraud is any kind of
activity that uses deception as its modus operandi. With this in mind, numerous scandals can be categorized
as fraudulent activities. In Kenya, the some scandals can be attributable to fraudulent activity. For example,
the Anglo-leasing fiasco is still to be resolved while the Triton Petroleum deals remain a mystery.
Fraudulent activities are not only a preserve of the private sector; the public sector is not left behind. The
National Social Security Fund (NSSF), the Ministry of Education, Kenya Pipeline has proved that fraud is
even more rampant in public institutions. | en |
