Sharia Economic and Management Business Journal (SEMBJ)
Vol. 7 No. 1 (2026): February

Integrating Islamic Values into HR Practices to Combat Fraud in Islamic Finance

Wilchan Robain (Universitas Pembangunan Panca Budi)
Abdul Rahman (Universitas Islam Sumatera Utara)



Article Info

Publish Date
15 Feb 2026

Abstract

The rapid growth of Islamic financial institutions has highlighted the need for HR practices that integrate Islamic values, particularly in preventing fraud. This study investigates the relationships between recruitment, selection, trustworthy human resources (HR), and fraud-free systems within Islamic financial institutions. Using Structural Equation Modeling (SEM) with SmartPLS 4, the study tests the direct and indirect effects of recruitment and selection on fraud prevention through trustworthy HR. The results show that both recruitment and selection significantly influence the formation of trustworthy HR, which in turn reduces the risk of fraud. The study also finds that trustworthy HR mediates the relationship between recruitment, selection, and fraud prevention. The research highlights the importance of aligning recruitment and selection strategies with Islamic ethical principles to ensure the development of a trustworthy workforce. The findings contribute to the literature on Islamic HRM by offering a model that links HR practices to fraud prevention. This study suggests that HR managers in Islamic financial institutions should prioritize value-based recruitment and selection processes, along with ongoing ethical training, to foster a culture of integrity and transparency. Future research could examine the role of other organizational factors, such as leadership and external regulations, in preventing fraud.

Copyrights © 2026






Journal Info

Abbrev

sembj

Publisher

Subject

Religion Agriculture, Biological Sciences & Forestry Computer Science & IT Economics, Econometrics & Finance Education Other

Description

SEMB-J, sharia economic and management business journal is peer-reviewed journal published by Yayasan Darussalam Bengkulu. SEMB-J focus on the research of sharia economic and management business. The aim of this journal is to explore and develop economic management related to islamic and business. ...