Abstract

Bill of Lading (BoL) documentation fraud poses a serious threat to trade‐finance integrity in Tanzania, where regulatory gaps may create exploitable opportunities for criminal actors. Focusing on CRDB Bank’s trade‐finance operations, this study employed a convergent mixed‐methods design to assess how regulatory weaknesses, internal control deficiencies, and technological limitations drive Bill of Lading (BoL) fraud in Tanzania’s trade‑finance sector: a survey of 97 trade‐finance professionals and 18 semi‐structured interviews with compliance and regulatory experts. Quantitative analysis revealed that perceived regulatory weaknesses measured by policy currency, inspection frequency, and enforcement consistency strongly predict fraud frequency (β = .42, p < .001), accounting for 62% of variance in reported fraud occurrences. Thematic analysis identified three core enforcement deficits: outdated circulars, infrequent inspections, and inconsistent sanctions. Together, these findings validate the “opportunity” component of Fraud Triangle Theory and highlight the need for annual regulatory reviews, risk‐based unannounced audits, and harmonized enforcement protocols. Implementing these measures is expected to substantially reduce BoL fraud, safeguard institutional assets, and strengthen Tanzania’s trade‐finance ecosystem. Key findings indicate that perceived regulatory gaps (β = .42, p < .001), procedural lapses (β = .29, p = .001), and digital deficits (β = .23, p = .003) collectively explain 62% of fraud variance; thematic analysis identified outdated circulars, infrequent audits, and siloed data as core enforcement deficits.

Keywords

  • Bill of Lading fraud
  • Regulatory Enforcement
  • Trade Finance
  • CRDB Bank

References

  1. Braun, V., & Clarke, V. (2006). Using thematic analysis in psychology. Qualitative Research in Psychology, 3(2), 77–101. https://doi.org/10.1191/1478088706qp063oa
  2. Cressey, D. R. (1953). Other people’s money: A study in the social psychology of embezzlement. Patterson Smith. https://archive.org/details/otherpeoplesmone00cres
  3. Dorminey, J., Fleming, A. S., Kranacher, M.-J., & Riley, R. A. (2012). Beyond the fraud triangle. CPA Journal, 82(7), 6–13. https://www.cpajournal.com/2012/07/01/beyond-the-fraud-triangle/
  4. European Banking Authority. (2020). Guidelines on internal governance requirements under Directive 2013/36/EU (EBA/GL/2020/06). https://www.eba.europa.eu/sites/default/documents/files/document_library/Publications/Guidelines/2020/GL_on_internal_governance.pdf
  5. International Chamber of Commerce. (2010). Uniform Customs and Practice for Documentary Credits (UCP 600) (ICC Publication No. 600). https://iccwbo.org/publication/uniform-customs-and-practice-for-documentary-credits-ucp-600/
  6. International Chamber of Commerce. (2020). Trade finance and fraud prevention. ICC Banking Commission. https://iccwbo.org/publication/trade-finance-and-fraud-prevention/
  7. Laryea, E. (2019). Dynamics of trade finance fraud in Ghana: A policy perspective. Journal of African Business, 20(3), 345–362.
  8. https://doi.org/10.1080/15228916.2019.1581115
  9. Saberi, S., Kouhizadeh, M., Sarkis, J., & Shen, L. (2019). Blockchain technology and its relationships to sustainable supply chain management. International Journal of Production Research, 57(7), 2117–2135. https://doi.org/10.1080/00207543.2018.1533261
  10. Saunders, M., Lewis, P., & Thornhill, A. (2019). Research methods for business students (8th ed.). Pearson Education. https://www.pearson.com/store/p/research-methods-for-business-students/P100004241773
  11. World Bank. (2021). Improving trade finance and competitiveness in East Africa. World Bank Group. https://openknowledge.worldbank.org/handle/10986/35105