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One of the greatest challenges facing commercial banks today is fraudulent activities
and Money Laundering. The continuous growth in technology and lack of proper
internal control system has put most banks in the stressful and unrest atmosphere.
This study was confined in analyzing the role played by Internal Control in
combating financial frauds and money laundering. NMB experience a number of
transactions which require detail pre and post review to ensure they comply not only
with BOT requirements but also NMB policy, given it’s the largest bank in Tanzania
both when ranked in branch network and customer base.
A case study design of the research has involved 30 NMB staffs. Four methods of
data collection were employed which are interview, questionnaires, observation and
documentations. Data found were analyzed through Statistical Package for Social
Scientist (SPSS). Findings from the study revealed that, internal control plays a
significant role in combating financial frauds and Money laundering. Most
respondent commented that, if these appropriate and satisfactory were lacking the
bank would have experience a significant number of frauds and money cleaning
cases.
Despite the comments given above, respondents’ recommends the bank to adopt both
proactive and reactive measure in dealing with frauds and money laundering issues
while stress the need to deal with criminal at the most vulnerable point.
Recommendations include: The government to make innovations into the present
policy, the bank of Tanzania (BoT) to improve strategies for monitoring and
management of other financial institutions, the same research to be done in other
banks and other issues in NMB PLC which influence the performance of the bank to
be studied. |
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