Question

Match each situation with the fraud triangle factor (opportunity, financial pressure, or rationalization) that best describes it.

(a)		An employee’s monthly credit card payments are nearly 75% of their monthly earnings.		select a factor	(b)		An employee earns minimum wage at a firm that has reported record earnings for each of the last five years.		select a factor	(c)		An employee has an expensive gambling habit.		select a factor	(d)		An employee has check-writing and -signing responsibilities for a small company, and is also responsible for reconciling the bank account.

A. __________________

B. __________________

C. __________________

D ___________________

Answer 1

No		Fraud factor	Reason
A	An employee’s monthly credit card payments are nearly 75% of their monthly earnings	financial pressure	There is financial pressure on the employee regarding credit card dues
B	An employee earns minimum wage at a firm that has reported record earnings for each of the last five years	Rationalization	Employee is rationalized to commit fraud as his pay is very less while company is earning huge money
C	An employee has an expensive gambling habit	Financial pressure	There is financial pressure on the employee which has arisen from his gambling habit
D	An employee has check-writing and -signing responsibilities for a small company, and is also responsible for reconciling the bank account	Opportunity	Employee has an opportunity to commit fraud as there is no segregation of duties to perform the task