Financial Irregularities in Banking Sector and Strategies to Counter Them in Pakistan
This research aims to analyze the financial irregularities prevalent in the banking sector of Pakistan and explore strategies to counter them. The banking sector remains vulnerable to irregular practices like money laundering, tax evasion, financial statement frauds despite regulations by the central bank. This quantitative study analyzes the impact of poor corporate governance, political interference, and economic pressures in promoting irregularities. Secondary data is statistically analyzed from regulatory filings, financial statements, and surveys of 100 bankers. Analysis indicates a significant influence of weak internal controls and external oversight in enabling irregularities. Strategies like strengthening board independence, limiting political interventions, improving transparency norms, and enhancing regulatory capacity have a strong potential to curb malpractices. These findings inform policymakers to undertake governance and regulatory reforms for a more resilient, ethical banking system.
Keywords: Banking Sector, Financial Irregularities, Corporate Governance, Regulations