Discussion On Internal Fraud Risk Management In Commercial Banks

In recent years, domestic and overseas media exposes a lot of major cases which caused by our country commercial bank’s operation risk. The largest proportion of these cases is the internal fraud committing crimes which caused the loss and hazard is also the largest. Internal fraud both in quantity and amount has become the largest operation risk loss event types of our commercial banks and has adverse effects to the competitiveness of the bank and the stability of economic and social in the increasingly fierce competitive environment. Research on the commercial bank’s internal fraud risk management not only can directly reduce the outbreak of such cases to protect the interests of the commercial bank and depositors, but also can increase the depositors of security and trust to the bank. Finally it can promote to maintent the financial stability and the healthy development of the economic and social.On the basis of refering to existing research results especially in the modern risk-oriented audit’s advanced ideas, this paper introduces the connotation and the involving basic theory of commercial bank’s internal fraud risk, summarize the characteristics of the internal fraud risk and the problems existed in its management, analyze the relationship between the commercial bank’s internal fraud risk management and the modern risk-oriented audit, analyze the feasibility of the modern risk-oriented audit in the application of commercial bank’s internal fraud risk management by using relevant theories and practical experience and with "C" banks as the research model for empirical research. It is concluded that the modern risk-oriented audit have strong initiative to prevent, discovery, reduce and stop of the commercial bank’s internal fraud risk. Finally, The paper put forward the new perspective of modern risk-oriented audit involving in the commercial bank’s internal fraud risk management and. made policy and recommendations for promoting the application of the modern risk-oriented audit in managing the internal fraud risk.It is looking forward to the paper’s research results can play a role of reference and significance for building effective commercial bank’s internal fraud risk management mechanism, improving the level of overall risk prevention and the competitiveness of our banking industry and enhancing its own security, stability, profitability, etc.