Article Synopsis: Why Employees Commit Fraud

Article Synopsis: Why Employees Commit Fraud

It’s either greed or need.

by Joseph T Wells

Tina-Marie Nadeau

Southern New Hampshire University

June 2012

Abstract

The article “Why Employees Commit Fraud” written by Joseph T Wells, February 2001, for the Journal of Accountancy describes the importance of understanding why employees embezzle. Mr. Wells is the founder and chairman of the Association of Fraud Examiners. He has written several books on the topic, for example Principles of Fraud Examination and Fraud Fighter: My Fables and Foibles. At a period when dishonesty at top U.S. companies is dominating public attention, The Fables and Foibles of a Fraud Fighter is a surprisingly frank and gripping memoir from an unsurprisingly effective fraud fighter. (Wells,2011).

The article focuses on the importance of the CPA to understand what motivates people to commit fraud and that all level of employees from top executives to the “rank and file employee” can engage in fraudulent acts. (Wells, 2011)

Analysis

John T Wells in his article “Why Employees Commit Fraud: Its either greed or need.” Focuses on theories to why good people go bad. Most would agree the person is greedy or even stretch to thinking the person is a known deviate, however not all fraudsters fall into these categories’. People have been committing fraudulent acts since snake oil ploys that commenced soon after the Pilgrims landed on Plymouth Rock. (Jenson, no date provided).

Fraud can be small like taking home a paperclip to embezzling millions of dollars. Given the right circumstances’, like the examples on the fraud triangle, opportunity, perceived opportunity, and rationalization. Which are key elements, however to expand the triangle, the individual who has sufficient motivation and has the capabilities would commit fraud. Non-sharable problems such as financial pressures lead many people who otherwise are honest and decent folks to take the path of fraud.

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