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    Teori Fraud Diamond

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    Citra
    This document discusses evolutions to the Fraud Triangle model, which analyzes factors that contribute to fraud. It introduces the M.I.C.E. framework, which expands on the "pressure" factor to include monetary incentives, bonuses, and stock options. It then discusses the Fraud Diamond model proposed by Wolfe and Hermanson, which adds a fourth factor of "capability" to the Fraud Triangle's factors of incentive, opportunity, and rationalization. The document explains that capability refers to an individual's traits and abilities that allow them to recognize and exploit opportunities to commit and conceal fraud. It argues capability limits who has the opportunity to commit fraud.

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    Teori Fraud Diamond

    Uploaded by

    Citra
    371 views2 pages
    This document discusses evolutions to the Fraud Triangle model, which analyzes factors that contribute to fraud. It introduces the M.I.C.E. framework, which expands on the "pressure" factor to include monetary incentives, bonuses, and stock options. It then discusses the Fraud Diamond model proposed by Wolfe and Hermanson, which adds a fourth factor of "capability" to the Fraud Triangle's factors of incentive, opportunity, and rationalization. The document explains that capability refers to an individual's traits and abilities that allow them to recognize and exploit opportunities to commit and conceal fraud. It argues capability limits who has the opportunity to commit fraud.

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    This document discusses evolutions to the Fraud Triangle model, which analyzes factors that contribute to fraud. It introduces the M.I.C.E. framework, which expands on the "pressure" factor to include monetary incentives, bonuses, and stock options. It then discusses the Fraud Diamond model proposed by Wolfe and Hermanson, which adds a fourth factor of "capability" to the Fraud Triangle's factors of incentive, opportunity, and rationalization. The document explains that capability refers to an individual's traits and abilities that allow them to recognize and exploit opportunities to commit and conceal fraud. It argues capability limits who has the opportunity to commit fraud.

    Copyright:

    © All Rights Reserved
    Download as PDF, TXT or read online from Scribd
    Download as pdf or txt
    371 views2 pages

    Teori Fraud Diamond

    Uploaded by

    Citra
    This document discusses evolutions to the Fraud Triangle model, which analyzes factors that contribute to fraud. It introduces the M.I.C.E. framework, which expands on the "pressure" factor to include monetary incentives, bonuses, and stock options. It then discusses the Fraud Diamond model proposed by Wolfe and Hermanson, which adds a fourth factor of "capability" to the Fraud Triangle's factors of incentive, opportunity, and rationalization. The document explains that capability refers to an individual's traits and abilities that allow them to recognize and exploit opportunities to commit and conceal fraud. It argues capability limits who has the opportunity to commit fraud.

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    © All Rights Reserved
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    of 2

    564 Dorminey, Fleming, Kranacher, and Riley

    FIGURE 7
    The Impact of M.I.C.E. on the Fraud Triangle

    Like the Fraud Triangle, the M.I.C.E. construct oversimplifies fraudulent motivations.
    Furthermore, some motivations fit multiple categories. Nevertheless, as a teaching device and a
    research tool for identifying motivators, modifying the non-sharable financial needs described by
    Cressey (1950), M.I.C.E. is easily remembered and provides an expanded framework to examine
    pressure (motivation).9 Consistent with Ramamoorti et al. (2009), the construct reminds instructors
    and students that motivations are complex. M.I.C.E. also allows for the possibility of collusion,
    which, technically, Cressey’s non-sharable financial need does not. With regard to financial
    reporting fraud, the pressure criterion of the Fraud Triangle has been adjusted to focus on
    motivators such as monetary incentives, bonuses, and/or stock options. While top executives clearly
    feel pressure to deliver solid financial results, it is not the non-shareable individualized pressure
    described by Cressey (1950). The impact of M.I.C.E. on the Fraud Triangle is presented in Figure 7.

    The Fraud Diamond: Adding the Fraudster’s Capabilities


    Wolfe and Hermanson (2004) argue that the Fraud Triangle could be enhanced to improve both
    fraud prevention and detection by considering a fourth element, capability. In addition to addressing
    incentive, opportunity, and rationalization, the authors’ four-sided fraud diamond gives
    consideration to an individual’s capability, which is described as an individual’s personal traits
    and abilities that play a major role in whether fraud may actually occur. The Fraud Diamond
    modifies the opportunity side of the Fraud Triangle, because without the capability to exploit
    control weaknesses for the purpose of committing and concealing the fraud act, no fraud can occur.
    Wolfe and Hermanson (2004) examine evidence that suggests that many frauds, especially
    some of the multibillion-dollar ones, would not have occurred without the perpetrator(s) having the
    right capabilities. As described by the authors, opportunity opens the door to fraud, incentive and
    rationalization draw the fraudster closer to the door, but the fraudster must have the capability to
    recognize the opportunity to walk through that door to commit the fraudulent act and conceal it.

    9
    Prior research (e.g., Beasley et al. 1999; Beasley et al. 2010) has suggested a greater set of motivations for white-
    collar crime, but to date the effect on the Fraud Triangle model has only been informally suggested.

    Issues in Accounting Education


    Volume 27, No. 2, 2012
    The Evolution of Fraud Theory 565

    The anti-fraud professional seeking to thwart a potential fraud then must evaluate how the
    current operational environment lends itself to manipulation. The essential traits thought necessary
    for committing fraud, especially for large sums over long periods of time, include a combination of
    intelligence, position, ego, and the ability to deal well with stress. The person’s position or function
    within the organization may furnish the ability to create or exploit an opportunity for fraud.
    Additionally, the potential perpetrator must have sufficient knowledge to understand and exploit
    internal control weaknesses and to use position, function, or authorized access to his or her
    advantage. The largest frauds are committed by intelligent, experienced, and creative people with a
    solid grasp of company controls and vulnerabilities. This knowledge is used to leverage the
    person’s responsibility over or authorized access to systems or assets. This type of person has a
    strong ego and great confidence that he/she will not be detected, or he/she believes that he/she could
    easily talk him/herself out of trouble if caught.
    Additionally, committing a fraud and managing the fraud over a long period of time can be
    extremely stressful (Pavlo and Weinberg 2007). Therefore, in addition to being knowledgeable and
    confident, a successful fraudster also deals well with the stress of committing and concealing the
    fraud.
    In the context of the Fraud Triangle, capability modifies the opportunity construct by limiting
    opportunity to a small set of individuals thought to have the necessary capability. Thus, capability
    likely affects the probability that an individual will be able to exploit opportunities in the control
    environment of the organization (see Figure 8).

    Predators versus the Accidental Fraudster


    The typical fraudster is often depicted as a first-time offender, middle-aged, well-educated,
    trusted employee, in a position of responsibility, and/or considered a good citizen through work in
    the community (ACFE 2009; Ramamoorti et al. 2009). The Fraud Triangle suggests that the
    perpetrator has a non-shareable problem that is grounded in financial shortcomings, and when
    aligned with opportunity and rationalization, an otherwise good citizen succumbs to committing
    fraud. This person might be characterized as the accidental fraudster. Notwithstanding the fraud
    act, the accidental fraudster is considered to be a good, law-abiding person, who under normal
    circumstances would never consider theft, break felonious laws, or harm others. When discovered,
    family members, fellow employees, and others in the community are surprised or even shocked by

    FIGURE 8
    The Impact of the Fraud Diamond on the Fraud Triangle

    Issues in Accounting Education


    Volume 27, No. 2, 2012

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