ABSTRACT
This chapter explains the dynamics of managerial fraud and corruption as a failure by bystanders and/or fraudsters to reach a common understanding of what is normal and what is abnormal. The fraudulent act is somehow interpreted in a common sense way, something that may prohibit critical reflection, new understanding and adequate action. According to Price waterhouse Coopers, only a third of all fraud incidents were detected by internal control and fraud protection systems, for example through internal audit, fraud risk management and rotation of personnel. Aristotle used the word 'Praxis' in order to designate virtuous actions taken without any conscious purpose in mind, apart from performing the action as perfectly as possible. The idea is that behind all actions lays an integrating structure of rationalizations. Rational calculations, precise documentation and fine-tuning of the established operating procedures make the bureaucracy efficient. The word 'moralize' may carry some unpleasant associations.
