Description: Sam Bankman-Fried has been found guilty of fraud for his actions around cryptocurrency company FTX. The jury deliberated for three days after a trial that lasted about a month. U.S. attorney Danielle Sassoon characterized Bankman-Fried as using customers money as a “personal piggy bank.” For his part, Bankman-Fried testified in his own defence that he did not commit fraud.
Date: November 2, 2023
Source: cbc.ca
Link: https://www.cbc.ca/news/world/bankman-fried-convicted-1.7017241
Discussion points:
1) Have you or any of your classmates invested in a cryptocurrency? If so, how was your experience?
2) Have you ever been the victim of a fraud?
3) Illustration 7.2 of Wiley’s Financial Accounting: Tools for Business Decision-Making discusses the fraud triangle. What are the three factors present in the fraud triangle?
Riyan Mittal, Mary Gould, Isabelle Rafter, Keeve
No, none of us had invested in the cryptocurrency because it hasn’t been very effective. There is a big chance of fraud and hacks, so they are high risks in investing in cryptocurrency.
Yes, we have been a victim of fraud, when we were shopping online for clothes then without realising that the cite was secured or not, we bought something, and the banking details were hacked and money was taken. Another one is, buying a sport equipment from a cite and the cite was not secured and a hacker stole the banking details and bought something from it.
The three factors present in fraud triangle are motivation, opportunity, and rationalization.
Spencer Long, Andrew Kuiper, Kohei Noda, Joel Williams
1) Two of us had invested in Bitcoin before but have since withdrawn our money after becoming concerned with the volatile nature of the cryptocurrency market
– To note we did both come out on top without a loss
2) None of us have been the victim of fraud luckily
3) The three factors present in a fraud triangle are:
Opportunity – which occurs when there are not enough systems in place to detect fraud or even stop it from happening. This could be due to lack of funds or just negligence.
Pressure – Is also called motivation as the pressures behind the individuals life are generally what influences them to commit fraud. Examples of this include individuals facing financial pressure at home that forces them to commit fraud or an individual at work facing enormous pressure from their bosses.
Rationalization – is when the individual committing the fraud begins to make excuses to justify their actions. An example of this is saying that you make way less money than those you are harming and therefore it is ok to do.
Mia Cogger, Andrew Joseph Munch, Benjamin Michel
1. none of us have invested in cryptocurrency because we didn’t feel like it was a good idea.
2. thankfully none of us have been a victim of fraud because we make sure we don’t give out out information to sketchy websites and make sure its a viable website.
3. the three factors that are presented in the fraud triangle are:
-opportunity: is opportunities to engage in fraud when an employee thinks they can get away with it and there aren’t very good internal controls.
-pressure: employees can feel pressured to commit fraud because they are having financial troubles (motivation).
-rationalization: is making themselves feel better about stealing and telling themselves that they are underpaid or that they will pay the company back for what they have taken.
Alexander Davison
1) I have personally never invested in any form of cryptocurrency.
2) Thankfully I have never been the victim of fraud.
3) Within the fraud triangle, Bankman-Fried had opportunity because he was in a position of power in his company with little to no oversight. This helped him commit his fraud undetected for years. He also had pressure to commit the fraud because he possibly wanted to live a lifestyle that he may not have been able to afford otherwise. Finally, Bankman-Fried rationalized his fraudulent activities by claiming he did not intend to mislead customers. This fraud clearly contains all the components of the fraud triangle.
Alexander Davison
Graeme Maither, Avery Marr, Breanne Wesselius, Jagger Vandewiel
Graeme Maither, Avery Marr, Breanne Wesselius, Jagger Vandewiel
1) None of us have invested in cryptocurrency.
2) None of us have been the victim of fraud, however, we do know of people close to us who have been the victims such as Avery’s Aunt and Graeme’s sister.
3) Within the fraud triangle there are 3 components. The first being opportunity, which is when an individuals finds they have the chance to exploit systems or loopholes to engage in fraud without getting caught. The second is pressure, which is also known as motivation and can happen when an individual feels they have no other option or there are outaside pressures on them to get involved in fraud. The third is rationalization, which takes place when an individual engaged in fraud begins to justify their reasonings for commiting the fraud.
Mishael Mathew, Christopher James Valent, Colby Allen Cormier, Jaimie Omer Gallant
1) No, None of our group members have engaged in any cryptocurrency investments, due to the volatile nature of the cryptocurrency market and the uncertainties surrounding its regulatory landscape.
2) Yes, We have been victims of fraud on online shopping sites that uses sensitive details of the consumer, which are then sold to 3rd parties. online shopping presents a dual concern encompassing both fraudulent activities and the enduring carbon footprint on the internet. While the convenience of online shopping is undeniable, it also exposes consumers to potential fraud.
3) Financial pressures or incentives that push people to commit fraud are referred to as pressures or incentives. It could be due to pressure from superiors in the organisation to reach improbable goals, personal financial difficulties, or even the desire for an opulent lifestyle.
Opportunity describes the conditions or scenarios that let someone commit fraud covertly. The presence of inadequate internal controls, inadequate supervision, or unchecked access to assets might give rise to fraudulent acts.
Rationalization, also called Attitude refers to the fraudster’s state of mind. They frequently persuade themselves that their dishonest behaviour is legitimate by using moral or ethical justifications for their acts. Believing they deserve the money, that they won’t be discovered, or that the victim won’t suffer any harm are examples of rationalisation.