The Fraud Examiner

The College Admission Scandal: A Textbook Example of the Fraud Triangle

Linda Miller, CFE

Practice Lead, Fraud Risk Management, Grant Thornton, LLP

I’m an expert in fraud risk management and I help organizations identify their potential vulnerabilities to fraud, which I’ve found is akin to spending my days convincing people to believe in ghosts — “Fraud? We don’t have a problem with that!” is a refrain I hear regularly. Almost everyone I talk to believes their organization is free from issues of fraud.

I’m also an Olympic athlete, who earned a coveted athletic scholarship to row at an expensive private university. As a top national high school rower, I was actively recruited by a number of elite colleges and universities. I worked hard throughout my high school years — even missing my senior prom — in order to train and achieve success in my sport.

As such, I’ve taken a particular interest in the unfolding college admissions scandal. Most Americans are shocked that bribery on this scale has been occurring for years, especially among trusted college coaches with long histories of being upstanding members of the sports community. They wonder, how could this have happened? As a fraud risk expert, I see the attitudes that allowed this scandal to occur every day.

It helps to first understand the Fraud Triangle. In 1951, Donald R. Cressey, a well-known criminologist, set out to answer the following question: Why does fraud occur? Cressey’s hypothesis was that: "Trusted persons become trust violators when they conceive of themselves as having a financial problem which is non-sharable; are aware this problem can be secretly resolved by violation of the position of financial trust; and are able to apply to relate their own conduct in that situation verbalizations which enable them to adjust their conceptions of themselves as trusted persons with their conceptions of themselves as users of the entrusted funds or property."

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