Skip to content
cybersecurity

Jul 06, 2024

What's Fraud Triangle and How It Happens

Fraud triangle adalah konsep untuk memahami bagaimana fraud bisa terjadi. Memahami fraud triangle memudahkan bisnis untuk mengantisipasi celah fraud.

Fraud Triangle: Definisi Serta Pencegahannya

The Fraud Triangle is a concept used to understand the causes of fraud in organizations. Introduced by criminologist Donald R. Cressey, it identifies three elements that lead to fraudulent behavior: Pressure, Opportunity, and Rationalization. Understanding these elements helps organizations implement effective prevention measures.

Definition of Fraud Triangle

1. Pressure
   - Financial Pressure: High debt, increased living costs, or urgent needs push individuals towards fraud.
   - Pressure from Superiors: Unrealistic targets set by management can lead to data manipulation.
   - Personal Pressure: Family, health, or relationship issues can also trigger dishonest actions.

2. Opportunity
   - Weak Internal Controls: Inadequate systems create opportunities for fraud.
   - Access to Resources: Unrestricted access to company assets or confidential information increases the risk.
   - Management Ignorance: Lack of oversight or awareness by management can foster fraudulent activities.

3. Rationalization
   - Feeling Entitled: Believing they deserve more than they receive.
   - No Other Option: Feeling fraud is the only solution to their problems.
   - Normalizing Fraud: Believing others do the same, thus justifying their actions.

Preventing Fraud in Business

Preventing fraud can be conducted in multiple ways: 

1. Implement effective control systems, including task separation and strict oversight.

2. Restrict and monitor access to sensitive resources based on necessity.

3. Foster a fair and supportive work environment to reduce employee stress.

4. Regularly educate employees about fraud risks and ethical behavior.

5. Conduct regular internal and external audits to detect and prevent fraud.

Types of Fraud

1. Financial Fraud: Involves financial transactions like credit card theft or financial report manipulation.

2. Identity Theft: Stealing personal information to conduct unauthorized actions, such as opening bank accounts.

3. Ransomware: Malware that locks access to data or systems, demanding a ransom for restoration.

4. Deepfake: Using AI to create realistic fake videos, audios, or images for fraudulent purposes.

Understanding and applying the Fraud Triangle helps businesses mitigate fraud risks, creating a safer and more ethical work environment. For enhanced digital security, VIDA offers verification services to safeguard business operations globally. Please contact VIDA Sales for further information. 

VIDA - Verified Identity for All. VIDA provides a trusted digital identity platform.

Latest Articles

Smartphone Rental Trend: A Data Theft Threat
cybersecurity

Smartphone Rental Trend: A Data Theft Threat

Beware of smartphone rental risks! Your ID card, selfies, and account logins can be used by scammers to steal your identity and hijack your...

April 15, 2025

Safe Types of Authentication for Digital Transactions
biometric authentication

Safe Types of Authentication for Digital Transactions

Discover the different types of secure authentication for digital transactions. Avoid phishing & fraud risks with biometrics, MFA, and devi...

April 05, 2025

The Right Way to Turn Off Two-Factor Authentication (2FA)
biometric authentication

The Right Way to Turn Off Two-Factor Authentication (2FA)

2FA might seem inconvenient because it requires two steps to access an account. However, two-factor authentication provides additional secu...

April 03, 2025