Fraud in Islamic Banks: Recent Research Developments

Muhtarom; Sudrajat; Usep Syaipudin

doi:10.63922/ijebir.v4i04.1944

Muhtarom Economic and Business Faculty, University of Lampung, Lampung, Indonesia
Sudrajat Economic and Business Faculty, University of Lampung, Lampung, Indonesia
Usep Syaipudin Economic and Business Faculty, University of Lampung, Lampung, Indonesia

DOI: https://doi.org/10.63922/ijebir.v4i04.1944

Keywords: Fraud, Cheating, Islamic Banks, Corruption, Transparency

Abstract

The Islamic banking industry is growing rapidly, but faces the risk of fraud that can damage its reputation and integrity. Fraud in Islamic banks often occurs due to weak internal supervision, low Islamic financial literacy, and the complexity of financial products that open up opportunities for irregularities. This study uses the Systematic Literature Review (SLR) method to identify, evaluate, and synthesize research related to fraud in Islamic banking by collecting articles from accredited sources between 2020 and 2024. After a rigorous selection, 8 main articles were selected to be analyzed to identify the methodology, topics, and findings related to fraud in Islamic banks. The results of the study show that although Islamic banks have adopted good governance, fraud challenges remain, influenced by external factors such as corruption and political instability, as well as internal factors such as weak Islamic supervision. Several studies highlight the importance of stricter Islamic supervision and transparency to reduce the risk of fraud, although disclosure of corruption in Islamic banks is less than in conventional banks. This study shows the need to strengthen sharia supervisory mechanisms and increase transparency in Islamic banks to reduce the risk of fraud, as well as develop more comprehensive strategies in implementing more effective governance.

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