Why People Commit Fraud
If organisations are to effectively manage fraud risks there needs to be an understanding of why people commit fraud.
The below presentation goes to explain this using a very well known (and old) fraud theory first presented by Donald R Cressey. His hypothesis was stated as:
Trusted persons become trust violators when they conceive of themselves as having a financial problem which is non-shareable, are aware this problem can be secretly resolved by violation of the position of financial trust, and are able to apply to their own conduct in that situation verbalizations which enable them to adjust their conceptions of themselves as trusted persons with their conceptions of themselves as users of the entrusted funds or property.1
This hypothesis can be used to explain why for example drug addicts or those with gambling addictions or huge debts can sometimes be tempted to commit fraud in order to fund their habit which is driving a non-shareable financial problem.
Why people commit fraud FMRC v2
