Fraud, who is responsible?

Thursday, 26 December, 2019

No organization is safe from fraud. The most common fraud schemes deal with misappropriation, or theft of assets. 

It is essential to remember the basics of fraud. Three factors are likely present for fraud to occur:

1. Motive – someone has a reason to steal

2. Rationalization – someone determines that it is okay to steal

3. Opportunity – someone can steal, potentially without detection

Motive and rationalization are factors that are beyond the control of management. These factors are commonly a result of outside influences, personal lives, and individual personalities. Opportunity is the one factor that management can control; therefore, focus needs to be on eliminating or reducing the opportunities to commit fraud.