for International Development Projects
FEATURED PAPER
By Isaac Odhiambo-Abuya, PhD & Michael Ouma-Owuor
University of Nairobi
Nairobi, Kenya
Abstract
Fraud is always a prevalent issue in international development projects, despite the strict donor oversight. Donald Cressey’s Fraud Triangle Theory of pressure, opportunity, rationalization, offers a foundational micro-level understanding of trust violation, but cannot fully elucidate the multi-layered, institutionalized complexity of fraud in development aid. This conceptual paper undertakes a theory elaboration of Cressey’s model using systematic synthesis of verifiable and accessible empirical research by the World Bank Integrity Vice Presidency, the USAID Office of Inspector General, UNFPA Office of Audit and Investigation Services, OECD Development Assistance Committee, and peer-reviewed development scholarship. The elaboration redefines pressure to include system pressures from rigid disbursement schedules, zero tolerance policy paradoxes, and political-electoral cycles; opportunity is expanded to include structural openings, such as information asymmetries, monitoring failures due to security concerns, and dispersed multi-tier supply value chains; and elaborates upon rationalization to include ideological defense mechanisms found in development settings, encompassing mission-driven justification and anti-bureaucratic resistance. Empirical evidence from the World Bank sanctions data for FY2025 shows a total of 4,268 complaints, 65 external investigations and 64% of adjudicated cases involve fraud, thus providing the empirical validation for the analytical utility of the elaborated framework. The application of the enhanced model widens forensic accountants’, and project managers’ ability to detect red flags and to design preventative governance that is rooted in development assistance realities.
Keywords: Fraud Triangle Theory; international development projects; aid corruption; theory elaboration; fraud prevention; governance
- Introduction
1.1 Background and Problem Framing
International development assistance represents a significant global undertaking. Aid to developing countries amounted to close to $1.7 trillion from 2010 to 2020. However, despite increased levels of sophisticated donor oversight mechanisms, fraud is still a pervasive challenge. The empirical connection between aid and corruption underlines the extent of the threat: aid increases tend to gravitate toward countries that have poor institutions, and regions that are most in need of development assistance are often plagued with weak institutions that do little to uphold traditional anti-corruption controls like audits or criminal charges. In the 2025 fiscal year (FY), the World Bank Group’s Integrity Vice Presidency received 4,268 complaints, 371 of which were found to be actionable and 65 cases were initiated as external investigations, while 19 sanctions cases and 19 settlements were filed and later selected for adjudication. Significantly, about 64 percent of the cases of settlements reviewed by the Office of Suspension and Debarment involved at least one allegation of fraud, and enforcement continued to focus heavily on fraud, particularly in procurement deceptive representations and documentation.
These statistics are just the portion of the fraud activity that has been detected. International development’s principal-agent structure, involving dispersed implementation over a number of principal agents, its multiple layers of principal-agent relations, and the security environment that prevents direct observation or monitoring, all pose systematic problems to detection. In fact, as Ensminger and Leder-Luis (2025) state, there are incentives for aid organizations to ignore or downplay negative outcomes because doing otherwise would offend or alienate donors, thereby reducing the likelihood of continued support. The OECD Development Assistance Committee has also recorded that strict zero tolerance policies often have the contrary effect, as they tend to disincentivize reporting and obscure the real reasons of corruption, thus engendering a culture of mistrust and lop-sided insights on ground realities. These structural conditions suggest that fraud vulnerability in development assistance is not an aberration but a predictable outcome of organizational and institutional design (Odhiambo-Abuya & Ouma-Owuor, 2026).
Donald Cressey’s Fraud Triangle Theory, which was developed in 1953 after interviewing imprisoned embezzlers, was based upon the idea that three conditions must be present for fraud to occur. These were a non-shareable financial pressure, a perceived opportunity to defraud or violate trust without detection, and a rationalization that allows the perpetrator to believe that the act is just or proper. The model has enjoyed predictive validity in a variety of corporate applications, however, its micro-focus initially developed for individual trust violations in stable organizational contexts, does create a need for considerable theoretical development in the context of the unique institutional architecture of international development projects.
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How to cite this paper: Odhiambo-Abuya, I. and Ouma-Owuor, M. (2026). Elaborating Donald Cressey’s Fraud Triangle Theory for International Development Projects; PM World Journal, Vol. XV, Issue XI, November. Available online at https://pmworldjournal.com/wp-content/uploads/2026/11/pmwj170-Nov2026-Abuya-Owuor-Elaborating-Donald-Cresseys-Fraud-Triangle.pdf
About the Authors
Isaac Odhiambo-Abuya
Nairobi, Kenya
Dr. Isaac Odhiambo-Abuya is a distinguished educator and leader in project management at the University of Nairobi, Kisumu Campus, where he directs academic programs and chairs the Research, Innovation and Enterprise Committee. He is deeply committed to graduate mentorship and advancing the field, having co-founded the university’s premier Annual International Conferences in Project Planning & Management and Project Monitoring & Evaluation. He maintains an active membership with the Project Management Institute (PMI). Email: isaac.abuya@uonbi.ac.ke
Michael Ouma-Owuor
Nairobi, Kenya
Michael Ouma-Owuor is a Development Researcher and Program Management Specialist attached to the Center for Policy Projects at the University of Nairobi as an Associate Researcher. His professional engagements center on pro-poor sustainable development, applied policy research, and the management of programs across the development landscape. He brings together practical field experience and research capabilities to bridge the gap between program implementation and evidence generation. He is passionate about strengthening the body of knowledge in program management and contributing professional publications that inform policy direction and development practice, with a particular focus on project governance systems, the effectiveness of development interventions, and institutional transformation within African settings. Email: michael.owuor@centerforpolicyprojects.org
