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Theoretical Model Of Fraud And Ethical Framework

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Running head: THEORETICAL MODEL OF FRAUD AND ETHICAL FRAMEWORK Theoretical Model of Fraud and Ethical Framework Name Institution 1 THEORETICAL MODEL OF FRAUD AND ETHICAL FRAMEWORK Theoretical Model of Fraud and Ethical Framework Theoretical Model of Fraud The fraud that was committed at HealthSouth is a clear case of occupational fraud. It amounts to the use of one’s occupation for personal development by the thoughtful misuse of a firm’s resources. The admission of the fraud by a majority of the firm’s employees is a clear indication that the fraud case was carried internally with widespread knowledge of its occurrence among the company's staff. Fraud Scheme When occupational frauds occur, they adversely affect the organization. These kinds of scams are committed by employees as seen in the case of HealthSouth which was perpetrated by the owner. The occurrence of the fraud at HealthSouth took place due to dishonest employees (Carlson, Coulter, & Vogel, 2004). The company was not in a position to truly compete with the market standards hence the need by the dishonest employees to tweak figures to impress the key stakeholders such as the creditors. The employees of the company held meetings meant for the overstatement of incomes and assets for effective and acceptable financial statements. The executives of the firm conducted themselves in a manner that was unacceptable as they set the tone for the deceit. For example, when one of the employees, Michael Vines, discov ...
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