The Fraud Triangle

The Fraud Triangle is a model used to understand why individuals commit fraud. It consists of three elements: 1. **Pressure**: The motivation or need that drives someone to commit fraud, such as financial difficulties or job insecurity. 2. **Opportunity**: The ability to commit fraud, often arising from weak controls or oversight in an organization. 3. **Rationalization**: The process by which a person justifies their dishonest actions, convincing themselves that it’s acceptable. Together, these factors explain how and why fraud occurs, highlighting the importance of strong ethical standards and internal controls to mitigate risk.