Personal Ethics and Fraudster Motivation: The Missing Link in Fraud Triangle and Fraud Diamond Theories

Abstract

Fraud in the society is like an opportunistic infection that bursts forth when greed meet the possibility of deception. Scholar has over time argued that prevention is better than cure. That it is better to prevent incidence of fraud rather than looking for culprit. Over time, Cressy’s Fraud Triangle Theory and recently Fraud Diamond Theory by Wolfe and Hermanson has been used by Auditors to understand the motivation of a fraudster, however, recent happenings has shown that the two aforementioned models are not adequate enough to understand the motivation of a fraudster. The position of this paper is that personal ethics is a key factor in fraudster’s motivation. Hence, this present study thus comes up with a new model called Fraud Pentagon Model. This new model is an extension of the two afore-mentioned models. It has succeeded in filling the missing link in the previous models.