I recently enjoyed the 1968 version of The Producers. Wonderful stuff. Lots of laugh lines I’d forgotten about since I watched it last. While watching, I realized there was a great illustration of a fraud triangle developed in about 5 minutes or so. For an edifying, educational exercise, let’s review the sequence to illustrate Continue reading
Having discussed the fraud triangle, you may wonder if there is anything you can do in your organization to stop the three sides of the fraud triangle from coming together and igniting into a disaster. Well, you can not absolutely prevent fraud. However, you can work to minimize the risk on each side of Continue reading
The rationalization factor was discussed here and here. When you dig into the rationalization process, you realize that churches and ministries are in a wonderful position to counter this part of the fraud triangle.
Motivation to commit fraud was discussed here and here. Many of the motivations to do wrong cannot be controlled by an organization.
Previous posts here and here discussed the opportunity to carry out a fraud. Opportunity means the door is open for a person to do something wrong. What can a ministry or church to manage or reduce the opportunity to commit fraud?
Watched a few minutes of a TV movie. The main character was busy lying to police as she framed a co-worker for hacking the bank’s computer system to hide her taking unidentified valuables out of safe deposit boxes and transferring who-knows-how-much money between accounts so she could get her hands on it.
As you can see from the previous posts, all three sides of the fraud triangle work together. A person has to have an opportunity to do something wrong combined with some sort of serious pressure along with a mindset to say that something that previously would have been wrong is now actually reasonable. Lacking Continue reading
The series of posts on the concept of fraud triangle have been pulled together into one page. This will allow you to read the series in chronological order, which should make it easier to follow the topic. You can find that page below the title bar, at the “fruad triangle” spot which is to the Continue reading
The various posts on the concept of fraud triangle have been combined into this page. Why? When many posts are up on a topic, they appear in reverse chronological order. So when an idea develops over many posts, you read them backwards on the blog. So, I will pull the fraud triangle posts together Continue reading
The final component needed to complete the fraud triangle is rationalization. This is the ability to persuade yourself that something you otherwise know is wrong is really OK. A lot of mental gymnastics are obviously needed to do so, but that is the point. If a person goes through those gymnastics, than what was Continue reading
Amongst the many dangers is that some motivations would be hidden from view in the workplace. Some of them, such as drinking or narcotics, would eventually show side effects in the workplace. Those factors could create visibility that would raise questions which in turn could in turn possibly result in discovery of the fraud. If Continue reading
Motivation is typically described as the pressure or incentive to commit fraud. When great pressure is brought to bear, people will do things you would have never thought possible. We used to illustrate this with someone who has a drinking problem or a gambling problem. Those illustrations of pressure don’t paint a good enough Continue reading
Opportunity is the first side of the fraud triangle we will discuss. This is when there is a situation that would allow a person to do something wrong. These are the weaknesses and procedures to correct them that we usually talk about. Places where someone could get their hands on money and get it Continue reading
This will be the first in a series of on what accountants call the fraud triangle. Just a few comments before we begin. These posts will be written in a more casual style that you would usually see from an accountant. They will definitely be more casual than you have seen in my published Continue reading
In a few days, printed copies of the two books in my Tragedy of Fraud series will be available in print at Amazon. They are currently available in e-book format at Amazon, Barnes & Noble, and the iTunes store.