DO BOARD STRATEGIES ENHANCE ELECTRONIC FRAUD DETECTION? EVIDENCE FROM DEPOSIT MONEY BANKS IN NIGERIA

Abstract

This study examines the effect of board dynamism on electronic fraud detection in listed deposit money banks in Nigeria from 2014 to 2023. Using panel data from 12 listed banks, the research investigates how board characteristics—including gender diversity, nationality diversity, institutional shareholding, board age diversity, and board remuneration—influence banks' ability to detect electronic fraud. The study employs logistic regression analysis and finds that board gender diversity and institutional shareholding have significant positive effects on electronic fraud detection, while board nationality diversity shows a negative impact. Board remuneration demonstrates a positive influence on fraud detection, but board age diversity shows no significant effect. The research reveals that board dynamism significantly impacts fraud detection capabilities, though the effectiveness varies across different board characteristics. The findings contribute to the growing literature on corporate governance and fraud prevention in emerging markets, offering practical implications for regulators, policymakers, and bank management in strengthening fraud detection mechanisms through enhanced board composition and governance structures. The study recommends implementing mandatory gender diversity quotas, improving cultural integration programs for foreign directors, strengthening institutional shareholder involvement, and developing performance-linked remuneration structures to enhance fraud detection in Nigerian banks.