All the cases highlight the importance of effective regulatory oversight in detecting and preventing fraud . They also emphasize the importance of ethical behaviour , strong and effective internal controls , speak-up and a corporate culture that emphasizes integrity and transparency .
make the company more attractive to investors and customers and former chief financial officer , Burkhard Ley , was charged with occupational fraud in 2023 ( 4 ).
All the cases highlight the importance of effective regulatory oversight in detecting and preventing fraud . They also emphasize the importance of ethical behaviour , strong and effective internal controls , speak-up and a corporate culture that emphasizes integrity and transparency .
To further understand these cases , it is beneficial to examine them through the perspective of Dr . Donald Cressey ' s ' fraud triangle ' theory . Dr . Cressey , a criminologist and sociologist , developed this theory to explain the factors that lead to occupational fraud . According to his theory , three elements are essential for occupational fraud to occur : opportunity , pressure or incentives , and rationalization . This framework helps to provide insights into how these elements might have influenced the fraudulent activities within these cases .
All of the cases show how the executives ' unfettered powers on approving incentives and benefits lead to fraud . For example , in the Wirecard scandal , senior executives were found guilty of artificially inflating the company ’ s financial statements to boost stock prices , thereby meet business targets and consequently increase personal wealth . This case highlights how the incentives to achieve financial success , along with weak internal controls and oversight , can lead to significant fraud .
FTX ' s downfall was another example of how absence of internal controls within the organization , including the absence of a chief financial officer , human resources department , compliance department , or board of directors can create opportunities for Bankman-Fried to divert funds and manipulate the financial structure without effective oversight . Also , the absence of a robust regulatory compliance fra-
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