The Eccentric Fascination for Fraud

Different investigators have researched many tendencies that characterized the behavior of the human being. For instance, forensic psychologists have studied the individuals that take part in the underground world of deception with the goal to clarify why the fraudulent trends exert a strange preoccupation in the human being.

The fraud triangle theory describes the three elements that make up a fraud: opportunity, rationalization and pressure. Any combination of them is the seeds of the unfortunate tortuous business experiences to individuals, small businesses, corporations, and government. However, these three elements are not exclusively responsible for this type of unacceptable behavior because any illegal activity needs other ingredients such as disloyalty, intention, knowledge, and destructive conduct.

These characteristics are unique to individuals, as each person has their own moral compass, regardless of profession, education, or social economic class. Ten percent of the population has the moral conviction to never perform a fraudulent act despite the circumstances of incentive, opportunity, or rationalization. On the opposite side, 10% of the population is constantly searching for the opportunity to seek an advantage and perpetrate any type of illegal act.

Thus, the remaining 80% of people may or may not be involved in illegal activities depending on their unique circumstance. For example, a sales person who fails to meet their goal might falsify small expenses in their expense report to cover up their shortcoming. This person falls under the 80% because he or she feels this act of fraud is rationalized to avoid punishment or receive a bonus, and will not face any consequences. If they had already met their goal, they would more than likely have submitted a clean expense report.

Those that choose to commit fraud constantly seek how they can take the best advantage of each situation evading the barriers of trust and dignity of others. These small groups of people, who live by and for fraud, enjoy the adrenaline rush by obtaining their illegal profits and dark deeds. They are hiding in many companies and camouflaging themselves throughout the corporation.

Some of these chameleons can be infinitely loyal and captivating to their victims to the point that their responsibility to family, friends, and reputation take a second seat. They operate without any remorse and ignore the possible negative impact that their behavior can generate. Unfortunately, they have no realization of their consequences until termination or legal prosecution.

Fraudsters share many personality traits that on the surface appear to be normal. Some can be bold, but others are simple and seemingly humble of heart. They can be hidden behind any religious or political organizations. In most cases, perpetrators are camouflaged in absolute loyalty and work ethics, but their egos convince them that their crimes will never be discovered. However, the fascination of committing a fraud is present every day. Ultimately, confidence and greed will be their downfall.

The fraud prevention program generally must focus on the protection of assets and reputation of the business. Not enough stress can be placed on the goal of the program to create a culture of inclusive corporate environment with zero tolerance to any individual who commits fraud or money laundering.

Therefore, prevention programs are the compass that helps large and small businesses follow governance guidelines with complete transparency. A strong prevention program it is the best method of deterrence to any perpetrator. Successful and transparent corporations admit the perpetuity of the businesses is built through an environment of strong ethics.