Micro financing has become one of the most portable sources for funding Small and Medium Scale Enterprises in Nigeria. However, the high rate of failed microfinance institutions in recent times has made fraud to become an issue for discuss in microfinance research in recent times. Anecdotal evidence shows that management tends to exonerate itself and rarely accept blame but shift blame to monitoring staffers when fraud cases are discovered in financial institutions.   This study seeks to ascertain the roles of operation staff and management in fraud cases perpetrated by fraudulent staff in Microfinance Institutions in Nigeria. The study used a sample of ten registered microfinance banks that have network of branches nationwide. The study employed Ordinary Least Square and ANOVA to analysed data collected from field. The results show that management’s lack of political will to implement fraud related policies, lack updated internal audit &internal control system and snob appeal behaviour of staffers are responsibility for high rate of fraud in microfinance institutions in Nigeria. The study also showed that fraud is more pronounced among branches in the city than those situated in rural areas. The study recommended that management should not be slow in implementing policies. The study also recommended that blood relations should not be allowed to work in the same microfinance institution. Finally the study recommended that minoring staff should watch the spending habits of their subordinates.