Abstract

Fraud is a global problem that affects society as a whole and interferes with work and personal life. It has been in existence for a long and it is a complex issue since fraudsters will always try not to leave any trace. Hence, the author explores the impact of fraud on the performance of microfinance institutions (MFIs) Cameroon. In this context, the author examines the methods employed in the Buea Municipality of Cameroon to prevent fraud in MFIs. A total of 15 MFIs were sampled as part of the primary data collection, which was analysed using descriptive and inferential (regression) statistics. The results obtained reveal that there is a significant relationship between fraud and the performance of MFIs in the Buea Municipality in Cameroon. Distinctively, the study shows that the enforcement of a zero-tolerance approach on fraud issues by the management of MFIs in the Buea Municipality in Cameroon is still low and that the internal control systems of MFIs are weak. The results on the correlation matrix reveals that performance is positively correlated with structural issues, negatively correlated with fraud and positively related with risk assessment.