This is just another form of Blackstone’s ratio: https://en.wikipedia.org/wiki/Blackstone's_ratio

The problem itself is an ancient one and you can find a number of texts that explore the idea from various angles.

This is from a policy-maker's perspective. It treats the human inclination toward fraud as an immutable force of nature (which may well be reasonable). But it seems the general idea is that policies required to achieve zero fraud would cost too much in enforcement. They would not be purely rational benefits for the organization whose policy is being written.

However from a different perspective, it's those policies that are an immutable force of nature. "Non-zero fraud is optimal" might sound like there could be a population who wasn't committing enough fraud. I haven't done any fraud this year, but I'm trying to be a good person. But that's not the Blackstone perspective. In Blackstone, the populace are thought of as reacting only to policy and basically having no autonomy.

I'm not arguing anything, but just noting how the sound-bite can be (and was) misconstrued.

	▲	iamnothere 3 days ago \| parent [-]
		I can see how you might have misunderstood. Yes, I was looking at it from the perspective of policy. Any policy designed to reduce crime is going to create some hardship for the innocent, and the question is how much enforcement-driven hardship is the public willing to tolerate in order to reduce crime-driven hardship. In a business context (as in the first article) your customers are not obliged to do business with you; in a democracy they are not obliged to vote for you. In the West we are typically less tolerant of enforcement-driven hardship. This goes back to our Enlightenment ideals about freedom and justice, which are less strong than they once were but are still present.