There are many scenarios and circumstances that can lead someone to face fraud charges. Many people might not even be aware of the risk of fraud charges until an investigation begins, or law enforcement issues a warrant for someone’s arrest.
Some experts state that there are specific factors that can impact the chance of fraud occurring. We will look at these three factors, known as “the Fraud Triangle.”
A look at The Fraud Triangle
In the 1970s, Dr. Donald Cressey developed the Fraud Triangle to explain the reasons why fraud occurs. According to this triangle, there are three main factors that increase the risk of fraud, including:
- Financial pressure: A desperate financial situation can be a factor for someone to commit this act. For example, many people across the United States deal with significant debt, which can be a stressor in both their professional and personal lives.
- Rationalization: People who commit fraud may believe that their actions are done for a good reason or intention. For example, some people may even intend to repay the amount after they resolve the financial pressure they face, but situations like this can easily spiral out of control.
- Opportunity: Opportunities may come from leadership oversight in the workplace or perhaps access to readily available finances.
Every case and every person is different. Indeed, there are many more varying intentions regarding why individuals commit fraud than just these three factors. Over the years, many people have started to question the use of the Fraud Triangle, but it remains a common consideration in fraud cases.
Why is this important to know?
When facing fraud charges, one may wonder how the Fraud Triangle can affect them. With the three intersecting reasons listed above highlighted as the most common precursors for fraud, it stands to reason that Virginia and federal law enforcement will investigate these factors extensively.
On that note, it is critical to understand the situation at hand that led to the charges to determine the most effective way to defend one’s rights. It is important to note that accusations of fraud could result in individuals facing both state and federal charges and penalties. Therefore, it is even more important to obtain skilled defense.