Common rationalizations include (but are not limited to) the following: Thus, the perpetrator of fraud justifies his fraud to himself. That means the person committing fraud sees himself as a normal, honest person who is trapped in a bad situation. Rationalization : The last leg represents rationalization.
The opportunity to commit fraud can arise from various circumstances such as: The person must see some way he can use or abuse his position of trust to solve his financial problem with a low perceived risk of getting caught. Opportunity: The bottom leg is opportunity, which defines the method by which the fraudulent act can be committed. Greed is oftentimes the driving influence. Changes in financial circumstances such as divorce or chronic family illness can also create a financial incentive. For instance, he might steal to conceal and support a drug problem, pay off debts, or acquire expensive cars or houses. The individual often has some “perceived unshareable financial problem,” so he begins to consider committing a fraudulent act.
This is what creates the motivation or incentive for the fraudulent act. These three basic circumstances lead to the commission of fraud as depicted by the “Fraud Triangle” below:įinancial Pressure: The upper-left leg of the triangle represents financial pressure. Why would a seemingly well-to-do physician turn to fraud? What possesses a person to commit such acts? The list of inappropriate billing and examples of patient mistreatment are many, but you get the point. Usually performed over several minutes, he completed the tests in seconds, making them useless as a diagnostic tool. Melgen unabashedly billed Medicare for procedures he claimed were performed on the artificial eyes of one-eyed patients as if they were real. Melgen became the highest-paid Medicare doctor by rendering unnecessary care to his elderly patient population who trusted him.īeyond the financial fraud that was bad enough, the medical tests were agonizing. Salomon Melgen was convicted of 67 crimes involving healthcare fraud for persuading elderly patients to undergo excruciating treatments they didn’t need for diseases they didn’t have. The attention-getting article is titled: “17-Year Sentence for West Palm Beach Eye Doctor in $73 million Medicare Fraud Case.” Dr.