Stay Aware of the Fraud Triangle

June 2, 2016

The fraud triangle has been a fixture in discussions on financial reporting fraud for over 50 years. Don Cressey first developed the fraud triangle in a 1953 paper in which he described the conditions that may exist in a strong or weak economy that lead to fraud. The conditions he outlines include: pressure or incentive to engage in fraud, a perceived opportunity, and the ability to rationalize fraudulent behavior. For a more detailed description of the ‘fraud triangle’ and the conditions that lead to fraud, check out the Anti-Fraud Collaboration’s report The Fraud Resistant Organization, which includes a bibliography of useful reports and resources.