IOSR Journal of Economics and Finance (IOSR-JEF) e-ISSN: 2321-5933, p-ISSN: 2321-5925.Volume 11, Issue 4 Ser. IV (Jul. – Aug. 2020), PP 43-51 www.iosrjournals.org DOI: 10.9790/5933-1104044351 www.iosrjournals.org 43 | Page Effect of Litigation Support Services on Fraud Mitigation in Firms Listed At the Nairobi Securities Exchange, Kenya Kirui Florence Chepngeno 1 , Sporta Fred 2 1 School of Business and Public Management, KCA University, Kenya 2 School of Business and Public Management, KCA University, Kenya Abstract: Due to the alarming increase in corporate fraud around the world, forensic accounting has in the recent past become an important area of discussion among academics and stakeholders of different organizations. Corporate fraud is reported as being the problematic issue for business organizations and as a result, several instances of collapse of big companies have been witnessed globally in the recent past. This is attributed to inadequacy of the statutory audit in detection of fraud. The study sought to establish the effects of litigation support services on fraud mitigation in firms listed at the Nairobi Securities Exchange (NSE). The target population comprised of all firms listed at the NSE that, have evidently used forensic accounting services. The study employed a non-probability sampling (purposive sampling) technique to choose the sample frame. Primary data was collected from purposively selected staff working with the aforesaid firms. The collected data was analyzed using both descriptive and inferential statistics with the aid of Statistical Package for Social Sciences (SPSS) version 25 and Statistics and data (STATA) version 13 analytical tools. The results of the analyses were presented in tabular form and were accompanied by pertinent interpretations and discussions. The study revealed that, there existed significant correlations between litigation support services and fraud mitigation. Key Word: Fraud mitigation, listed firms, litigation support services, Nairobi Securities Exchange --------------------------------------------------------------------------------------------------------------------------------------- Date of Submission: 16-07-2020 Date of Acceptance: 31-07-2020 --------------------------------------------------------------------------------------------------------------------------------------- I. Introduction Background Due to the alarming increase in corporate fraud around the world, forensic accounting has in the recent past become an important area of discussion among academics and stakeholders of different organizations. Though the concept of forensic accounting dates back to 1800s, it was not until the collapse of big companies such as Enron that some legislations like the Sarbanes Oxley was brought into existence, increasing the demand for forensic accounting services (Mammen & Edakalathur, 2019). Blodget (2011) attributed the collapse of the big corporations to financial mismanagement and inadequacy of the statutory audit, citing the case of Longtop financial fraud where the revenue reported was erroneous but not discovered by the regular audits. Zou (2016) attributed the cases of fraud in China listed firms to lack of legal awareness of the management staff, reduction of the audit procedures and lack of due diligence investigation before listing the company. Chen (2016), who sought to examine the scandals facing foreign firms listed in the US and the audit quality opined that shareholders of firms which are involved in the scandals experience substantial loss. Ocansey (2017) quoted the Federal Bureau of Investigation of United States of America that estimated that more than three hundred billion dollars is lost annually to fraud and many of these crimes are difficult to identify due to the concealment of the perpetrators’ activities. Developing countries have not been spared too and cases of frauds are on the increase in the listed companies. Agbaje and Adeniran (2017) in their study found out that incidences of fraudulent activities exist in quoted companies in Nigeria and that since the auditors are answerable to the management, their independence is compromised. Ehioghiren and Atu (2016) in their scholarship revealed that fraudulent practices in Nigeria are key challenges facing the country’s development and the result is that stakeholders have been affected negatively by the crimes pertaining finances. Efforts to curb the dangers of fraud in Nigeria by setting up of institutions of anti-corruption have played an insignificant role (Okoye, 2013). Okoye and Gbegi (2013) observed that employee fraud and other financial frauds require the accounts to have skills that can enable them to identify those crimes. Kenya which is one of the developing economies is reported to be ahead in terms of corruption and is leading the world in occupational fraud, a major corporate crime, with an incidence of 66%, which is about twice the global average of 34% (Kimani, 2015). Most of the governmental and non-governmental organizations