ADELANTE
Institutional Repository

An intended act of deception that involves financial interactions for personal advantage can be widely referred to as financial fraud. Complex financial transactions are involved in many fraud cases such as Ponzi and pyramid schemes etc. This study aimed to identify the factors influencing business students' susceptibility to investment fraud. It examined the four factors (situation, cognition, personality, and state) that affect respondents' gullibility toward financial fraud. The results indicate that while most respondents are less gullible and are not easily susceptible to financial fraud, some SBM students are still vulnerable to fraudulent activities. Despite being business students, some respondents were still susceptible to investment fraud due to their state, which suggests that knowledge alone may not be enough to protect individuals from fraudulent schemes. Notably, the study found that the dominating factor influencing SBM students' susceptibility to financial fraud is their state, which is characterized by a desire to make more out of their money and excitement towards investing. These findings highlight the importance of promoting financial literacy and educating SBM students on the risks and consequences of fraudulent financial activities, particularly their state of mind when making investment decisions.