Fraud

Group Members
Name Section ID

• Jannatun Nayeema 45B 2181011123

• Israt Jahan Tonny 45B 2181011099

• Rabin Khan 45B 2181011142

• Jasmin Akter Ritu 45B 2181011121

• Tarina Sharkar Mim 45A 2181011032

• Arafat Al Jubair Shoron 45A 2181011021

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Who perpetrates fraud &
why
White-collar criminals (a type of non-violent crime
that is financially motivated)

Why?
▫ motivated by curiosity
▫ a quest for knowledge
▫ the desire to learn
▫ how things work
▫ the challenge of beating the system

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Fraud Triangle…

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Fraud triangle is used to explain the reason behind
the fraud.
THIS IS A SLIDE TITLE
- Pressures (person’s incentive or motivation for
committing fraud)
- Opportunity (condition or situation that allows a
person or organization to commit and conceal a
dishonest act and convert it to personal gain)
- Rationalization (excuse that fraud perpetrators use
to justify their illegal behavior)
Fig.1: Fraud Triangle

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 1. Pressure
i. Financial pressure ( e.g. heavy financial losses, bad
investments, tax avoidance)
ii. Emotional pressure (e.g. performance not recognized, job
dissatisfaction, fear of losing job)
iii. Lifestyle pressure (e.g. gambling habit, drug or alcohol,
addiction family/peer pressure)

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 2. Opportunities
i. Commit the fraud ii. Conceal the fraud iii. Convert the theft or
▫ overstatements of to hide a theft of misrepresentation to
assets or revenues company assets is to personal gain
▫ understatements of charge the stolen fraud
liabilities item to an expense perpetrators who do not
▫ failures to disclose account steal cash or use the stolen
information assets personally must
convert them
to a spendable form

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 Opportunities Permitting Employee and Financial
Statement Fraud
INTERNAL CONTROL FACTORS OTHER FACTORS
▫ Failure to enforce/monitor internal ▫ Large, unusual, or complex
controls transactions
▫ Management override of controls ▫ Incompetent personnel
▫ Too much trust in key employees ▫ Rapid turnover of key employees
▫ Inadequate supervision ▫ Lengthy tenure in a key job
▫ Unclear lines of authority ▫ Operating on a crisis basis

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 3. Rationalization
Perpetrators rationalize that they are not being dishonest, that honesty is not required of
them, or that they value what they take more than honesty and integrity.

Fraud occurs… Fraud can be prevented…

▫ high pressures ▫ eliminating or minimizing one or more
▫ an opportunity to commit, conceal, fraud triangle elements
and convert ▫ reducing or minimizing opportunity
▫ the ability to rationalize away their by implementing a good system of
personal integrity internal controls

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 yo n e!
y o u ever
k
Than

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