Effect of Whistle Blowing On Fraud Prevention and Detection in Nigeria Public Sector

European Journal of Accounting, Finance and Investment
Vol. 6, No. 6; June-2020;

ISSN (3466 – 7037);
p – ISSN 4242 – 405X
Impact factor: 5.02
EFFECT OF WHISTLE BLOWING ON FRAUD PREVENTION AND

DETECTION IN NIGERIA PUBLIC SECTOR
Ehioghiren, Efe Efosa. PhD and OEAGA, Joseph Oseikhumhen

Department of Accountancy Shaka Polytechnic, Edo State, Nigeria
Department of Accountancy Faculty of Management Sciences University of Benin, Benin City
Correspondence: Ehioghiren, Efe Efosa
Abstract The study investigates the effect of whistle blowing on fraud detection in public sector in Nigeria. Three specific
objectives and hypotheses were raised and formulated. The design of the study was descriptive research design and the
population of the study consists of 870 employees of public businesses and parastatals at the two tiers of government in
Edo state. The sample for the study was 274 by applying statistically the Yaro Yamane formula. Data collected was
analysed using simple percentage (%). The null hypotheses raised for the study, was analysed using the t- test. The results
revealed that federal public businesses and parastatals whistle blowers is significantly better than state public business
and parastatals in whistle blowing reporting practices programme in reducing fraudulent activities. Also that whistle
blowing legislation is a panacea for fraud prevention and detection in both the federal and state Nigeria public sector.
The study recommend among other that management and relevant authority should commit themselves to establishing
effective whistle blowing apparatus by embedding whistle blowing awareness in the culture and the framework of its
ethical code of conduct. Creating an atmosphere of openness and trust, providing effective complaint handling process
Also, the legislative and judicial arm of government needs to step up their games to allow the policy on fraud to thrive as
it were cases of fraud take so much years pending in court and at tmes the perpetrators of these frauds are let free on the
grounds of technicality.
Keywords: Internal, External, Whistle Blower, Fraud, Detection, Prevention, Public Sector
Introduction matter its size and complexities, fraud constitutes a

Over the past few decades there has been a tremendous purposeful disregard for organizational system and a
growth in the industrialization. (Brennan, & Kelly, 2007) deliberate attempt to violate that system for personal gain,
advocate that the growth of corporate culture has brought and most organisation systems are not developed to stop
with it the spread of democratic systems, increased this. (Emeka-Nwokeji, Okeke & Ojimba, 2019) have the
prosperity and wealth, and diversified local economies. same opinion that the reason for this is that frauds are
(Ajibola, 2017) agree that at the same time it has also rarely reported for prosecution in our country and one
created extreme degrees of greed, exploitation, fundamental source of worry on the issue of fraud in
corruption, fraud and environmental destruction. Fraud public sector in Nigeria is scarcity of accurate statistics
remains a considerable problem for every organisation no on the numbers of cases of fraud and the numbers of
An official Publication of Center for International Research Development
Double Blind Peer and Editorial Review International Referred Journal; Globally index
Available www.cird.online/EJFAI/: E-mail: ejfai@cird.online
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those convicted. It has become essential for every to listen to all staff, means that issues and concerns can be
progressive organization today’ s to behave in a socially addressed promptly.
responsible manner and become good corporate citizen. Whistle blowing needs to be encouraged by employers
(Habeeb, 2019) believes that organizations have to create ‘ as the right thing to do’ . It is clear that there needs to
a strong corporate culture with major emphasis on an be a cultural change throughout the public sector and a
unconditional attitude championing the ethical and moral very clear message must come from the top of every
behavior of individual employees. As Albert Einstein has organisation that senior management supports workers
rightly said, “ The world is a dangerous place, not who raise genuine concerns and that all such concerns
because of those who do evil but because of those who raised will be taken seriously and investigated
look on and do nothing!” As such, it is very important to appropriately.
speak up in the face of wrong doing and not just being a (Taiwo, 2015) Whistleblowers suffer in various ways
silent spectator, in addition, Abraham Lincoln added by including ostracism, harassment, punishment, punitive
saying “ To stand in silence when one should be transfers, reprimands and dismissal. Bosses and top
protesting makes cowards.Unless organizations foster a managers are responsible for many attacks of
culture that declares and demonstrates that it is safe and whistleblowers but co-workers often join in or do nothing
to raise a genuine concern about wrongdoing, employees often due to fear that they could be the next victim.
will assume that they face victimization, losing their Job (Ogungbamila, 2014) are of the view that employees
or damaging their career. The consequence is that most hesitate to raise voice as this might lead to retaliation as
employees will stay silent where there is a threat-even a poverty and unemployment are rampant in these countries
grave one; this silence can mean that those in charge of and whistle blowing can result in job loss ( Fasua &
the organization place their trust on the people who Osifo, 2017).
operate them. This means that they deny themselves what The public sector has been criticized for having high rates
can be the fail-safe opportunity to deal with a serious of corruption, compare to the private sector which has
problem before it causes real damage. (Jannah, 2017) almost become a norm. Matters such as bribery,
Workers are the most valuable resource in any corruption, issues ghost workers, recruitment of under
organisation, not just because of what they do, but also qualified staff, Mismanagement of funds and absenteeism
because they have a unique perspective on frontline from work has become order of the day in the public
services. They are the eyes and ears that witness bad sector. (Onakoya, 2016).Often times, failure to bribe or
practice and wrongdoing that could harm individuals, comply with such terms can make the case may remain
colleagues, organisations and members of the public. It is pending for years. Such delay result into poor quality of
essential that employers tap into this rich vein of services rendered in turn would affect the overall
intelligence and welcome workers who are courageous performance of the organization. Hence the reality of
enough to speak out. whistle blowers would provide little justification for
Encouraging workers to speak out has many benefits: it government or senior public sector managers to think
protects others by preventing further wrongdoing; it ‘ proactively’ about how to manage whistle blowing
promotes a transparent culture; it protects and reassures cases.
the workforce; and it helps to maintain a healthy working (Rezaee, & Riley, 2010) in their view that whistle
culture and efficient organisation. An organisation’ s blowing is the reporting of certain types of wrong doing
willingness to examine areas of potential weakness, and or raising concern at any time about an incident that
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happened in the past, is happening now or believes will Ho1: There is no significance difference in the gender
happen in the near future. (Gentile, 2010; Fasua, & Osifo, difference in whistle blowing reporting practices
2017) avow that whistle blowing has become a focal programme in reducing fraudulent activities
point of attention for organizations and their stakeholders, Ho2: There is no significance difference of internal
It refers to reporting of illegal, unethical, immoral or whistle blowing and external whistle blowing
illegitimate practices within an organization to practices
appropriate authorities for a corrective action. Ho3: There is no significance difference between
There is, however no consensus whether whistle blowing whistle blowing legislation and fraud prevention
policies in organizations actually reduce fraud and and detection in Nigeria public sector
increase the individualization of work, allowing REVIEW OF RELATED LITERATURE
employees to behave in accordance with their conscience Conceptual Framework
and in line with societal expectation (Davis, 2012; What is ‘ wrongdoing’ ?
Robinson, & Robertson,2012; Erkmen, Çalışkan, & Whistle blowing can be about a wide spectrum of illegal,
Esen, 2014). The realization that somebody is watching immoral or illegitimate practices. In this research, the
is a sufficient deterrent to unscrupulous person(s) who spectrum is captured by the general term ‘ wrongdoing’ ,
might nurse the ambition of committing fraud. Despite with data collected in terms of a large number of different
these and many other benefit of establishing a system that types of behaviour that could be categorised in a number
encourages report of unethical conduct, there is still fraud of different ways including whether there could be
occurring in public sector. This created gap for this paper primarily private or public interests involved. (Adebayo,
which attempt to empirically answer the broad question 2014). A wide definitional approach was necessitated not
of whether whistle blowing has effect on prevention and only by the imprecision of existing categories, but by the
detection of fraud in Nigeria public sector. inherent dangers of taking too restrictive an approach,
Objectives of Study whether in research or in legislation. For example,
The main objective of the study is to determine the effect restricting whistle blowing to only ‘ serious’ examples
of whistle blowing on fraud detection in public sector in of public interest wrongdoing begs the question of in
Nigeria. The specific objectives of the study were to whose judgment the wrongdoing meets that
ascertain the following: threshold.(Adeyemo, 2015). An agency wishing to
i. To determine gender difference in whistle minimise the amount of whistle blowing to which it need
blowing reporting practices programme in respond can simply increase the threshold. In reality, the
reducing fraudulent activities benefits of whistle blowing are likely to be encouraged
ii. To determine the significance difference of only when agencies promote an ‘ if in doubt, report’
internal whistle blowing and external whistle approach (Bowen, Call, & Rajgopal, 2010) examples of
blowing practices wrongdoing, were grouped into seven major categories
iii. To examine the significance difference between for the purpose of analysis: • misconduct for material
whistle blowing legislation and fraud prevention gain (including bribery, corruption and theft) • conflict
and detection in Nigeria public sector. of interest • improper or unprofessional behaviour
Research Hypotheses (including many types of recognised official misconduct)
The following hypotheses were tested in the course of this • defective administration (including incompetence and
research study: negligence) • waste or mismanagement of resources •
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perverting justice or accountability • personnel or not only to organizational reprisal but also to the
workplace grievances chastisement at the hands of other organizational
Whistle blowing members, organizational members react and most likely
The term whistle blowing is derived from a sporting event show retaliation against whistle blower. Thus, whistle
where the referee blows the whistle to stop an illegal or blowing is not a risk-free decision or initiative for any
foul play (Erkmen, Çalışkan, & Esen, 2014).There have individual as it can entail direct and undesired
been several attempts to define whistle blowing, but consequences for the person raising voice against some
certainly there is no generally accepted definition. The wrongdoing. Whistleblowers can be considered as ethical
term whistleblower comes from the phrase ‘ blow the consistent employees who disclose in good faith unethical
whistle` which indicates an activity that is illegal or foul. practices within the workplace, thereby expecting
(Brown, Latimer, McMillian, & Wheeler, 2008) asserted investigation of the disclosure. (Chartered Institute of
that whistle blowing is seen as the disclosure of Internal Auditors, 2014)
information about perceived organizational wrongdoing, Internal and External Whistle Blowing
to parties that are in a position to take action, if this Whistle blowing is generally classified into two types;
disclosure is in the public interest’ ’ Whistle blowing Is internal and external whistle blowing (Coderre, 2009).
a behavior that is characterized not only by intent but also This classification was based on the channel to report to,
by action when employees are confronted with that is the recipient receiving a report of wrongdoing in
organizational wrongdoing. an organization. External whistle blowing uses external
The Whistle Blower channel to report inadequate or illegal practices in an
A whistle blower is a person who tells the public or organization. The receivers of the information are anti-
someone in authority about alleged dishonest or illegal corruption or regulatory government agencies, mass
activities occurring in a government department, a public media and other external parties to the organization.(
or private organization or a company. The alleged Davis, 2012) On the other hand, internal whistle blowing
misconduct may be classified in several ways; a violation performs by using the reporting channels inside the
of law, regulation and or a direct threat to the public organization, while whistleblowers typically have both
interest such as fraud, health /safety violation and internal and external reporting channels available to
corruption (Ajero, 2009). (Call, Martin, Sharp, & Wilde, report organizational transgressions; research suggests
2017) describe whistleblowers as committed members of that all whistleblowers initially attempt to report
the organization who feel compelled to report wrongdoing via internal channels before utilizing external
wrongdoing by their own sense of moral behavior. channels. (Dworkin, Smith, & Broon, 2008) External
However, this act is not always seen positively by whistleblowers tend to experience more extensive
organizations. A Whistleblower is characterized as organizational retaliation than internal whistle blowers.
reluctant dissenters moved neither by altruistic nor selfish External whistle blowing tends to cause greater damage
concerns, but rather by tide of events over which they feel to an employee’ s co-workers and the employer than
they have little control. (Cassematis, & Wortley,2013) internal whistle blowing, as the latter can give the
refers to a whistleblower as a person who exposes organization an opportunity to fix in appropriate practices
falsehood and corruption although he or she is aware of (Coenen, 2008).Whereas, internal whistleblowers may be
the potential negative outcomes of this act, which may surprised at the response to their reporting (Erin,
include loss of job. The whistle blowers are vulnerable Ogundele, & Ogundele, 2016), the external
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whistleblowers know they are taking a major step which retaliate against the whistle blower (Gentile, 2010). It is
will not be well received by the organization. assumed that a whistleblower’ s experiences (perceived
Benefits of whistle blowing or actual, reward or retaliation) following a whistle
Despite several key developments in the Nigerian public blowing event will have strong effects on others’
sector, the same symptoms of financial recklessness, willingness and likelihood to blow the whistle in the
unethical practices and weak corporate governance future (Manson, 2008). Logically, organizational
(Ogungbamila, 2014) are still characteristics of the response to whistleblower action depends in part upon
institutions. The government through its various agencies whether management agrees with the merit of the claim
has made efforts in issuing circulars and introduced and with the whistleblower’ s obligation to take action
ethical code of conduct for practices for public sector (Nwaze, 2006). Under circumstances where an
institutions, including a mandatory whistle blowing organization is dependent upon the continuation of the
policy among others. Whistle blowing provides several wrongdoing or when they are not dependent upon the
benefits to the individual, organization, and the society. whistleblower (e.g., Resource Dependence Theory), the
For the individual, it emerges as an agent of change, with organization is more likely to retaliate against the
a sense of achievement and satisfaction on the whistleblower and continue the wrongdoing (Roberts,
remediation of a negative course of event. The employee Olsen, & Brown, 2009). Retaliation may take many
thus acts as a partner in ensuring the sustainability of the forms, ranging from attempted coercion of the
organization. (Fasua, & Osifo, 2017).The organization whistleblower to withdraw accusations of wrongdoing to
benefits by prevention or termination of fraud, corruption, the outright exclusion of the whistleblower from the
illegal and illegitimate activities, which reduces exposure organization (Rohde-Liebenau, 2006). Other retaliatory
to risk, losses and legal action. Also, the shareholders‟ acts may include organizational steps taken to undermine
confidence is increased, while the organization’s image of the complaint process, isolation of the whistleblower,
being responsible is enhanced. In summary, the reputation character defamation, imposition of hardship or disgrace
of the organization (one of the most important assets it upon the whistle blower, exclusion from meetings,
has) is kept intact. An organization that loses its elimination of perquisites, and other forms of
reputation quickly disintegrates (see Enron, Arthur discrimination or harassment (). Retaliatory acts may be
Andersen). Whistle blowing promotes public good, and a motivated by the organization’ s desire to (1) silence the
safer society. (Onakoya, 2016).Nigeria as a country for whistleblower completely, (2) prevent a full public
instance, stands to benefit from whistle blowing as an knowledge of the complaint, (3) discredit the
anti-corruption tool through efficient allocation of whistleblower, and/or (4) discourage other potential
resources, preservation of national wealth, and improved whistleblowers from taking action (Vona, 2008).
well-being of the citizenry. These benefits lead to positive Retaliation is not always initiated by organizational top
perception, improved ratings in global indices, and management. Rather, isolated acts of retaliation may be
ultimately the attraction of foreign investors. initiated by the whistle blower’ s supervisor or coworkers
Retaliation against whistleblowers with or without (formal or informal) sanctioning by top
Once an organization member has blown the whistle on management. Supervisors may be motivated to retaliate
an organizational wrongdoing, management may make against whistleblowers for a variety of reasons, but they
two types of decisions: (1) whether to disregard the claim frequently do so out of fear that a whistle blowing claim
or take appropriate action, and (2) whether to reward or signals their inability to maintain order and compliance
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within their departments, or the fear that valid complaints context of direct face-to-face interaction. This would
will result in the restriction or cessation of their own include classic “ con games” (Okeye, & Okaro, 2012),
operations or inﬂuence (Thornton,2006). frauds by sales staff, and predatory activities against
Fraud clients or customers by unethical investment advisers,
In its broadest terms, fraud means obtaining something of shady roof repairers and others who prey directly on a
value or avoiding an obligation by means of deception. consumer.
(Okoye, 2016) define fraud as all multifarious means • Fraud committed against a number of individuals
which human ingenuity can devise and which are restored through print or electronic media, or by other indirect
to by one individual to get an advantage over another by means. This would include Nigerian advance fee frauds
false suggestions or oppression of truth, it includes all (Nenyiaba, Osisioma, & Okoye, 2015), share market
surprises, tricks, cunning or dissembling and any unfair manipulation, and deceptive advertising or investment
way which another is cheated. solicitations pitched at a relatively large number of
Fraud is as difficult as identifying it. No definite and prospective victims.The above categories are neither
invariable rule can be laid down as a general proposition definitive nor mutually exclusive, but they do provide a
in defining fraud as it includes surprise, trick, cunning useful starting point for explanation.
and unfair ways by which another is cheated (Okeye, & Public Sector Organizations in Nigeria
Okaro, 2012; Abdullahi, Mansor, & Nuhu, 2015). The public sector organizations in Nigeria follow a
Fraud is a legal term that refers to the intentional bureaucratic structure that was introduced during the
misrepresentation of the truth in order to manipulate or British colonial rule. Since winning independence in 1960
deceive a company or individual (Albrecht, Albrecht, & till this date, the same system is still in place. The public
Albrecht, 2008) reaffirmed that fraud embraces many and sector employees are called “ civil servants,” holding
varied forms of conduct, ranging from false claims different job titles (Taiwo, 2015). Regardless of their job
against an insurance policy to some corporate frauds that titles civil servants in the bureaucratic structure of Nigeria
are meticulously planned and intricate in their execution. are recognized on the basis of their salary grade level
The variety and complexity of fraud such as impunity, (SGL), which ranges from SGL-1 to SGL-17: SGL-1
stealing, large scale fraud , bribery and corruption being the lowest and SGL-17 being the highest. There are
including other forms of malpractices has necessitates two main cadres of employees, namely, officers and non
that, for purposes of explanation, the concept of fraud are officers. Those in the officer cadre are also referred to as
“ broken down” into manageable categories. bureaucrats (SGL-10 to SGL-17). These officers are
• Fraud committed against an organization by a principal selected through a competitive examination conducted
or senior official of that organization. Examples of this centrally by the Federal Public Service Commission for
include offences against shareholders or creditors by federal government and State civil service commission
errant “ high-flying entrepreneurs” (Egbunike, 2011) or for the State government and at time it may be by
corrupt practices by senior public officials. promotion. The other cadre of non officers (SGL-1 to
• Fraud committed against an organization by a client SGL-09) is selected by different public sector
(an “ outsider” ) or employee (an “ insider” ). This organizations either by promotion or through a non
category includes embezzlement, insurance fraud, tax centralized organization based selection system.
evasion and other fraud against government.• Fraud The public sector organizations in Nigeria have been
committed against one individual by another in the criticized for having high rates of corruption, which has
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almost become a norm. Matters such as reporting a theft other adverse actions.In the absence of comprehensive
to the police, issuance of a driving license, getting your whistle blowing legislation, the Federal Ministry of
pension, getting a gas connection, issuance of passport, or Finance has set up a Whistle blowing programme, which
getting a contract to build a highway may not be is designed to encourage members of the public to report
entertained without bribing one ways. any violation of financial regulations, mismanagement of
Establishing Whistle blowing Reporting Practices public funds and assets, financial malpractice, fraud and
legislation Programme theft. Members of the public are encouraged to report any
Establishing whistle blowing reporting practices of the above-mentioned infractions by submitting an
legislation Programme involves designing and anonymous tip on the Federal Ministry of Finance
implementing whistle blowing policies and procedures in Whistle blowing Portal. (Golden, Skalak, & Clayton,
an organization. Whistle blowing reporting practices 2006)
legislation programme encompass a wide range of Empirical Studies
activities including compliance with laws and regulations, Empirical evidence from a study by (Taiwo, 2015) on the
training and education put in place to prevent fraud and effects of whistle blowing practices on organizational
detect it when it does occur. They are procedures to be performance in the Nigerian public sector. Descriptive
followed by whistle blower, management and auditors in Survey research design was adopted in the study. Data for
the course of uncovering fraud. In recent years, there has the study were gotten from both primary and secondary
been rapid increase of fraud perpetrated in public sources. A total of 700 questionnaires were administered
organisation. (Miceli, Near, & Dworkin, 2009).The using simple random technique. A total of 672 of the
nature, degree, extent and magnitude of this fraud varied administered questionnaires were retrieved and found
from one public organisation to another public useful for data analysis. Three hypotheses were stated to
organisation. Accordingly, it has become necessary to guide the study. Simple frequency table, Pearson’ s
design whistle blowing reporting practices programme to correlation coefficient and descriptive statistics were used
encourage employees to blow whistle for any unethical for various analysis of the study. The result of the study
conduct. Establishing effective complaint handling revealed that there is a significant relationship between
procedure involve putting in place a methodical approach whistle blowing practices in the public sector at r equals
which organisations can use to register complaints and 0.363, n=672, p<0.01. The result of the study also
channel to the relevant and appropriate agency, institution revealed that there is a significant relationship between
and groups for action. Complaint handling procedures protection of whistle blowers and performance in the
facilitate disclosures, encourage proper individual public sector at r equals 0.511, n=672, p<0.01. The result
conduct and alert the audit committee to potential of the third hypothesis showed that there is a relationship
problems before having serious consequences. It enables between disclosure of unethical practices and the
an organisation to deal with whistle blowers complaints performance in the public sector at r equals 0.840, n=672,
swiftly and efficiently.( IIA, AICPA and ACFE 2008) p<0.01. Findings from the study showed that respondents
Nigeria does not have comprehensive whistle blowing disagreed to the fact; that employees feel confident to
legislation. There are, however, several bills before the report unethical practices within the organization to
National Assembly which aim to regulate the receipt and external bodies. The study recommended that public
investigation of wrong doing in the public sector, as well organizations should promote culture of whistle blowing
as the protection of whistleblowers from reprisals and that broadly needs to be supported and articulated
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throughout the organization. The study therefore firm-specific factors that led employees to expose alleged
concludes that whistle blowing should be encouraged and financial misdeeds; Whistle-blowing announcements
not discouraged in the context of the organization. were associated with a negative 2.8 percent market-
(Ogundele, & Ogundele, 2016), investigate the effects of adjusted five-day stock price reaction; firms subject to
whistle-blowing on the quality of financial reporting in whistle-blowing allegations were associated with further
the Nigerian banking sector using survey design. The negative consequences including earnings restatements,
empirical findings show that whistle-blowing adoption shareholder lawsuits, and negative future operating and
has a positive significant relationship on the quality of stock return performance. As large frauds come to light
financial reporting in the Nigerian banking sector. seemingly one after another in public companies, the
(Onakoya, 2016), develop a conceptual framework on investing public lost confidence in both in the financial
whistle blowing reporting attitude of bank employees in reports and capital market. Regulations were
Nigeria. Analysis of data among other things provided implemented to help restore public trust and investor’ s
evidence that Leadership has a positive effect on confidence. The regulations are meant to prevent and
employees‟ trust to encourage whistle blowing attitude; reduce fraud. Regulations are aimed at improving the
Organizational culture and ethical climate has a positive integrity, safety and efficiency of capital market while
effect on employees‟ loyalty for whistle blowing attitude maintaining their global competitiveness. Continuing he
and support structures has a positive effect on employees‟ is of the view that in order to inspire investor’ s
perceived reward toward whistle blowing attitude. confidence, regulations should be considered fair and
(Fasua, & Osifo, 2017), examined effective whistle- balance. However, (Coenen, 2008) noted that regulation
blowing mechanism and audit committee in Nigerian is not necessarily the answer to fraud problem. Culture
banking sector. The study shows a strong association and tone at the top send message down the line that either
between effective whistle blowing mechanism in support or discourages raising concern against unethical
Nigerian banking sector and audit committee practices.In a recent research by (Emeka-Nwokeji, et. al,
independence, audit committee financial expertise, and 2019) on whistle blowing: a panacea for fraud prevention
audit committee meeting. In a study on whether there is a and detection in Nigerian public companies. This study
link between whistleblower involvement and the examines whistle blowing as a necessary condition for
outcomes of enforcement actions, Call, Martin, Sharp, & fraud prevention and detection in Nigerian public
(Wilde, 2017) find that whistleblower involvement is companies. Survey design was used. Population of this
associated with higher monetary penalties for targeted study consists of employees of public companies with
firms and employees and with longer prison sentences for registered office in Anambra.state Out of 132
culpable executives. Also analysis suggest that questionnaires distributed, 98 were properly filled and
whistleblowers are a valuable source of information for returned representing 74% response rate which is
regulators who investigate and prosecute financial considered appropriate. Data collected for the study were
misrepresentation. analysed using descriptive statistics. One sample t-test
(Bowen, Call, & Rajgopal, 2010), document evidence on was used for testing hypotheses one and three while
the characteristics and economic consequences of firms hypothesis three was tested using Pearson product
subject to whistle-blowing allegations of corporate moment correlation coefficient. Analysis provides
financial misdeeds. Analysis shows that firms subject to evidence that whistle blowing programme is significant in
whistle-blowing allegations were characterized by unique reducing fraudulent activities in public companies; that
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there is significant relationship between whistle blowing n=

legislation and fraud prevention and detection in public
companies. The result also shows that basic elements of
whistle blowing have not been properly established in Where N= Population
public companies. The study recommends that e= Limit of tolerable error is 5%
management should establish effective whistle blowing n= Sample size
programme by embedding whistle-blowing arrangement 1= constant
awareness in the culture and the framework of its code of To get a sample from the population
conduct. Employee and stakeholders should be involved n= 870
in the development and review of company’ s whistle 1 + 870 (0.05)2
blowing programme. There is also urgent need for our n = 274
policy makers to pass the long awaiting whistle-blower’ s Data for the study
protection bill, with protective measures included. The primary source of data will be use as means of
METHODOLOGY getting information needed for this research, through the
Research Design use of Questionnaires administered to the sample size.
The design of the study was descriptive research design. Data obtained was analysed in simple descriptive
Descriptive research aims at collecting data on, and statistics presented in tables.
describing in a systematic manner, the characteristic Method of data analysis
features and facts about the population of study. Data collected from the employees was analysed using
simple percentage (%). The three null hypotheses raised
Population of the Study for the study, was analysed using the t- test method. This
The population of the study consists of 870 employees of is because each of the hypotheses involves testing for the
public businesses and parastatals at the two tiers of significant difference of two groups or things.
government in Edo state. Four public businesses and EMPIRICAL ANALYSIS AND RESULTS
parastatals at the federal and state each making a total of The major findings are presented in the following tables
435 employees from four public business and parastatals Table 1: Ho1: There is no significance difference in the
respectively. gender difference in whistle blowing reporting practices
Sample of the Study programme in reducing fraudulent activities
The sample for the study was done by applying Summary of t-test analysis of difference the gender
statistically the Yaro Yamane formula that is difference in whistle blowing reporting practices
programme in reducing fraudulent activities
Categories Variable N x SD Df t Sig Remark

Federal Public Bus. & Male 69 57.75 8.56 131 1.37 .174 NS
Parastatals Female 64 55.44 10.93
State Public Bus. & Male 69 57.21 9.10 131 2.50 .014
Parastatals Female 64 52.86 10.85 S
Source: Researchers’ Compilation (2020)

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Data in table 1 show that the sig value is greater than the parastatals whistle blowers is significantly better than
set alpha value of 0.05 of level of significant, we can state public business and parastatals in whistle blowing
concluded that there is therefore no significant difference reporting practices programme in reducing fraudulent
in the mean values of male and female in federal public activities.
business and parastatals in whistle blowing reporting Table 2: Ho2: There is no significance difference of
practices programme in reducing fraudulent activities. internal whistle blowing and external whistle
The results revealed that federal public businesses and blowing practices
Summary of t-test analysis of whistle blowing between internal and external in whistle blowing practices
Categories Variables N x SD Df t Sig Remark
Federal Public Bus. & External 75 67.64 9.70 142 6.46 .000 S
Parastatals Internal 69 57.75 8.56
State Public Bus. & Parastatals External 75 68.32 11.38 142 6.41 .000 S
Internal 69 57.21 9.10
Data in table 2 above show that the sig value is less than blowers are significantly better in both federal and state
the set alpha value of 0.05 of level of significant, we can public business and parastatals than external whistle
concluded that there is therefore significant difference in blower.
the mean values of internal (57.75)(57.21) and external Table3. Ho3: There is no significance difference between
(67.64)(68.32) whistle blowers in federal public whistle blowing legislation and fraud prevention
business and parastatals and state public business and and detection in Nigeria public sector
parastatals. The result revealed that internal whistle
Summary of t-test analysis of whistle blowing between legislation and fraud prevention and detection in Nigeria
public sector
Categories Variables N Mean Std Df T S Remark
Federal Public Bus. & Legislation 66 76.33 11.82 128 10.46 .000 S
Parastatals
Fraud 64 55.44 10.93
State Public Bus. & Legislation 66 76.80 12.90 128 11.44 .000 S
Parastatals
Fraud 64 52.86 10.85

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Impact factor: 5.02
Data in table 3 show that the sig value is less than the set is a significant relationship between whistle blowing
alpha value of 0.05 of level of significant, we can practices in the public
concluded that there is therefore significant difference in 3. Difference of whistle blowing between legislation
the mean value of (76.33)(76.80) legislation and and fraud prevention and detection.
(55.44)(52.86) fraud prevention and detection in federal This finding revealed that there is significant difference in
public business & parastatals and the state public business the legislation and fraud prevention and detection in
and parastatals. The result revealed that whistle blowing federal public business & parastatals and the state public
legislation is a panacea for fraud prevention and detection business and parastatals. This could have been as a result
in both the federal and state Nigeria public sector of Legal provision of support and protection to whistle
Discussion of findings blowers and Overall Whistle blowing legislation and
The discussion is organized under this sub heading; regulation. Therefore, whistle blowing legislation is a
1. Difference in gender on whistle blowing reporting panacea for fraud prevention and detection in both the
practices programme in reducing fraudulent activities federal and state Nigeria public sector
The study establishes that there is no significant Conclusion and Recommendations
difference in male and female in federal public business Public companies in Nigeria and indeed the economy at
and parastatals in whistle blowing reporting practices large need urgent recovery from adverse effect of fraud
programme in reducing fraudulent activities. The finding thus the study on the effect of whistle blowing on fraud
concurred with the finding of (Emeka-Nwokeji, Okeke, & detection in public sector in Nigeria could not have come
Ojimba, 2019) who found that whistle blowing at a better time than now. Tips from whistle blowing
programme is significant in reducing fraudulent activities. legislation are seen as a panacea for fraud prevention and
The reasons may be providing accurate evidence for detection in both the federal and state Nigeria public
prosecuting employees involved in unethical practice and sector. Proactively preventing fraud, investigating
raising concern at the earliest opportunity reduces suspicions of fraud and punishing those who commit
embezzlement fraud are among fraud preventive measures. It is in this
2. Difference in whistle blowing between internal and regard that the study recommends that management and
external practices relevant authority should commit themselves to
The study found that there is difference in internal and establishing effective whistle blowing apparatus by
external whistle blowers in federal public business and embedding whistle blowing awareness in the culture and
parastatals and state public business and parastatals. The the framework of its ethical code of conduct. Creating an
result revealed that internal whistle blowers are atmosphere of openness and trust, providing effective
significantly better in both federal and state public complaint handling process, may be the credible
business and parastatals than external whistleblower; the mechanism for safeguarding confidentiality and
reason may be the credible mechanism for safeguarding anonymity to whistle blower and the provision of support
confidentiality and anonymity to whistle blower and the and protection against retaliation to person who report
provision of support and protection against retaliation to suspected fraudulent, unethical and illegal practices.
person who report suspected fraud. Also, the legislative and judicial arm of government
The finding partially corroborate with the result of needs to step up their games to allow the policy on fraud
(Taiwo, 2015) who result of the study revealed that there to thrive as it were cases of fraud take so much years

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Impact factor: 5.02
pending in court and at times the perpetrators of these 85(4), 1239-1271.

frauds are let free on the grounds of technicality. doi:https://doi.org/10.2308/accr.2010.85.4.1239
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