SOCIO-ECONOMIC MOTIVATIONS FOR PARTICIPATION IN FINANCIAL FRAUD IN THE INSURANCE SERVICES MARKET

Abstract

Introduction. The issue of financial fraud, in particular in the market of insurance services and the motives for participation in them by individual participants who are able to recognize a possible financial pyramid and refuse to participate in it is especially relevant at the present stage of development of Ukrainian society. In developed countries, the problems of involvement and motives for participation in financial pyramids are paid much more attention than in Ukraine, where a potential consumer of a financial product is often left alone with the problem after the closure of a fraudulent project. Methods. The methodological basis of the article is a dialectical-materialist approach, and during the research special general scientific methods were used: analysis and synthesis - in determining the motives of participation and relationships of participants in the financial pyramid; historical and legal - in disclosing the experience and consequences of the spread of fraud, in particular on the example of Albania. Results. The article attempts to assess the factors that affect the relatively conscious participation of consumers in financial projects, with clear signs of a financial pyramid. We interpret the financial pyramid as: "the activity of the enterprise of the financial sphere, which is to accept funds for investment with a high level of return (at least at the level of declaration); however, this goal is not realized at all or to a sufficient extent, which causes a spiral of losses." We single out the motives for involvement in the structures, which during the operation of the payment of liabilities are made from the current investments of new clients (investors or partners) and the factors that determine the involvement in such structures of colleagues, family, friends and acquaintances and their financial resources. Discussion. Aggressive marketing, which declares extraordinary profits, so large that their size precludes rational thinking and awareness of the fairness of distribution or financial enrichment, in the representation of celebrities who authenticate the proposed obligations in combination with the level of regulation and financial literacy significant prospects for further research on this topic. This situation allows us to predict a significant number of new participants in financial pyramids and exacerbation of financial fraud. Keywords: insurance, financial pyramid, fraud, motives, factors.