Wk4 Discussion (Interviewing) - Post 1

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happens during the verbal confession, you should make a mental note of the discrepancy

and proceed as if the falsehood had been accepted as truthful.

Such discrepancies should be saved until all other relevant facts have been provided by the

accused. If the discrepancies are material to the offense, you should either resolve them at

the end of the verbal confession or wait and correct them in the written confession. If they

are immaterial to the offense, the information can be omitted from the written confession

altogether.

You should focus on obtaining the following items of information during the verbal

confession:

• Confirmation that the accused knew that the conduct was wrong

• Facts known only to the perpetrator

• Estimated numbers of instances or amounts

• A motive for the offense

• When the misconduct began

• When/whether the misconduct was terminated

• Others who were involved

• Physical evidence

• Disposition of proceeds

• Location of assets

• Specifics of each offense

Confirmation That the Accused Knew That the Conduct Was Wrong

Intent is an essential element in all criminal and civil actions involving fraud. Not only must

the confessor have committed the act, but he must also have intended to commit it: “As I

understand it, you did this, and you knew it was wrong, but you didn’t really mean to hurt

the company, is that right?” (Note that the question is phrased so that the confessor

acknowledges intent, but “didn’t mean to hurt anyone.” Make sure the question is not

phrased so that the confessor falsely says that he “didn’t mean to do it.”)

Facts Known Only to the Perpetrator

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Once the intent question has been solved, the questioning turns to those facts known only to

the person who committed the crime. These facts include—at minimum—the accused’s

estimates of the number of instances of wrongful conduct, as well as of the total amount of

money involved. It is best to use open questions here to force the subject to provide as much

information about the offense as possible.

Estimated Numbers of Instances/Amounts

In fraud matters in particular, it is common for the accused to underestimate the amount of

funds involved as well as the number of instances. This is probably because of a natural

tendency of the human mind to block out unpleasant matters. You should take the figures

provided by the confessor with a grain of salt. If the accused’s response is “I don’t know,”

start with high amounts and gradually work down.

A Motive for the Offense

Motive is an important element of establishing the offense. The motive might be the same as

the theme you developed earlier—or it might not. The most common response when a

subject is asked about his motive is “I don’t know.” You should probe for additional

information, but if it is not forthcoming, attribute

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the motive to the theme developed earlier. The motive should be established along the lines

below.

When the Misconduct Began

You will need to determine the approximate date and time that the offense started: “I am

sure you remember the first time this happened.” Once the subject has admitted to

remembering the first instance (which will usually play into the motive), you should simply

ask him to “tell me about it.” This is phrased as an open question to get the subject to

provide as much information as possible.

When/Whether the Misconduct Was Terminated

In fraud matters, especially occupational fraud, the offenses usually are ongoing. That is, the

fraudster seldom stops before he is discovered. If appropriate, you should seek the date the

offense terminated.

Others Who Were Involved

Most frauds are solo ventures—committed without the aid of an accomplice. However, you

should still seek to determine whether other parties were involved. It is best to use soft

language: “Who else knew about this besides you?”

By asking who else “knew,” you are, in effect, not only asking for the names of possible

conspirators, but also about others who might have known what was going on but failed to

report it. This question should be leading: not “Did someone else know?”, but rather “Who

else knew?”

Physical Evidence

Physical evidence—regardless of how limited it might be—should be obtained from the

confessor. In many instances, illicit income from fraud is deposited directly in the

perpetrator’s bank accounts. You should ask the confessor to surrender banking records

voluntarily for review. It is recommended that you obtain a separate written authorization,

or that language be added to the confession noting the voluntary surrender of banking

information. The first method is generally preferable. If other relevant records can be

obtained only by the confessor’s consent, permission to review those records should also be

sought during the oral confession.

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Disposition of Proceeds

If it has not come out earlier, you should find out what, in general, happened to any illicit

income derived from the misdeeds. It is typical for the money to have been used for

frivolous or ostentatious purposes. It is important, however, that the interviewer cast the

confessor’s actions in a more positive light.

Location of Assets

In appropriate situations, you will want to find out whether there are residual assets that

the confessor can use to reduce losses. Rather than asking the accused, “Is there anything

left?” the question should be phrased, “What’s left?”

Specifics of Each Offense

Once the major hurdles have been overcome, return to the specifics of each offense.

Generally, it is best to start with the first instance and work forward chronologically.

Because this portion of the interview is information-seeking in nature, use open questions.

It is best to seek the independent recollections of the confessor first before displaying

physical evidence. If the confessor cannot independently recall something, documents can

be used to refresh her recollection. It is generally best to resolve all issues relating to a

particular offense before proceeding to the next offense.

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Taking a Signed Statement

At the conclusion of the admission-seeking interview, it is best to obtain a written confession

from the subject, if possible. As was discussed earlier, a written statement has greater

credibility than an oral confession, and discourages a culpable person from later attempting

to recant. The information to be included in the signed statement is essentially the same as

that which you should obtain in an oral confession. There are, however, a few extra

inclusions that should be made in a written confession.

Voluntary Confessions

The general law of confessions requires that confessions be obtained, and made, completely

voluntarily. The statement should contain language expressly stating that the confession is

being made voluntarily.

Intent

There is no such thing as an accidental fraud or crime. Both require as part of the elements

of proof the fact that the confessor knew the conduct was wrong and intended to commit

the act. This can best be accomplished by using precise language in the statement that

clearly describes the act (e.g., “I wrongfully took assets from the company that weren’t

mine” versus “I borrowed money from the company without telling anyone”).

As a general rule, strong, emotive words, such as “lie” and “steal,” should be avoided, lest

the confessor balk at signing the statement. Yet the wording must still be precise:

EXAMPLE

Instead of

Use

Lie I knew the statement was untrue.

Steal I wrongfully took the property of _____ for my own benefit.

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Instead of

Use

Embezzle I wrongfully took _____ ’s property, which had been entrusted to me, and used it for my own benefit.

Fraud I knowingly told _____ an untrue statement and he/she/they relied on it.

Approximate Dates of Offense

Unless the exact dates of the offense are known, the word “approximately” must precede

any dates of the offense. If the confessor is unsure about the dates, language to that effect

should be included.

Approximate Amounts of Losses

Include the approximate losses, making sure they are labeled as such. It is satisfactory to

state a range (“probably not less than _____ or more than _____ ”).

Approximate Number of Instances

Ranges also are satisfactory for the number of instances. The number is important because

it helps establish intent by showing a repeated pattern of activity.

Willingness to Cooperate

It makes it easier for the confessor when he perceives that the statement includes language

portraying her in a more favorable light. The confessor can convert that natural tendency

by emphasizing cooperation and willingness to make amends: “I am willing to cooperate in

helping undo what I have done. I promise that I will try to repay whatever damages I

caused by my actions.”

Excuse Clause

The confessor’s moral excuse should be mentioned. You should make sure that the

confessor’s excuse does not diminish her legal responsibility for the

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actions. Instead of using language such as “I didn’t mean to do this”—which implies lack of

intent—focus on an excuse that provides only a moral explanation for the misconduct: “I

wouldn’t have done this if it had not been for pressing financial problems. I didn’t mean to

hurt anyone.”

Have the Confessor Read the Statement

The confessor must acknowledge that he read the statement, and should initial all the pages

of the statement. It might be advisable to insert intentional errors in the statement so that

the confessor will notice them. The errors are crossed out, the correct information is

inserted, and the confessor is asked to initial the changes. Whether this step is advisable

depends on the likelihood that the confessor will attempt to retract the statement or claim

that it was not read.

Truthfulness of Statement

The written statement should state specifically that it is true. However, the language also

should allow for mistakes. Typical language reads, “This statement is true and complete to

the best of my current recollection.”

Preparing a Signed Statement

There is no legal requirement that a statement must be in the handwriting or wording of the

subject. In fact, it is generally not a good idea to let a confessor draft the statement. Instead,

you should prepare the statement for the confessor to sign.

The confessor should read and sign the statement without undue delay. Instead of asking

the confessor to sign the statement, say, “Please sign here.” Although it is not legally

required, it is still a good idea to have two people witness the signing of a statement.

There should not be more than one written statement for each offense. If facts are

inadvertently omitted, they can later be added to the original statement as an addendum.

For legal purposes, you should prepare separate statements for unrelated offenses, in the

event the target is tried separately for each offense.

You should preserve all notes taken during an interview, especially those concerning a

confession. Having access to pertinent notes can aid in a cross-examination regarding the

validity of a signed statement. Stenographic notes, if any, also should be preserved. Once a

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confession has been obtained, you should substantiate it through additional investigation, if

necessary.

Here is a sample of the way the confession of Linda Reed Collins might be worded:

St. Augustine, Florida

May 1, 2010

I, Linda Reed Collins, furnish the following free and voluntary statement to Loren D.

Bridges and Tonya Vincent of Bailey Books, Incorporated. No threats or promises of any

kind have been used to induce this statement.

I am senior purchasing agent for Bailey Books, Incorporated, and have been employed by

Bailey Books, Incorporated, since 2005. My job is to oversee the purchase of merchandise

and other supplies for Bailey Books, Incorporated. As part of my job, I am to ensure that

Bailey Books, Incorporated, receives the highest-quality products available at the lowest

possible cost.

Commencing in approximately February 2008, and continuing through the current time, I

have accepted money from James Nagel, sales representative for Orion Corporation, St.

Augustine, Florida. Mr. Nagel offered me money to ensure that his company received

preferential treatment in supplying Bailey Books, Incorporated, with stationery and paper

products.

On those occasions on which I accepted money, I was aware that Bailey Books,

Incorporated, was not obtaining the best product available at the lowest

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possible price. The price charged for products delivered during the time I accepted money

was substantially higher than market value.

On two occasions in April 2009, I authorized the payment of invoices of $102,136 and

$95,637, respectively; these invoices were paid without the receipt of any merchandise.

Nagel and I subsequently split the proceeds of these invoices equally between us.

I estimate that I have received in excess of $150,000 in connection with Mr. Nagel. I am not

sure that anyone at Orion Corporation knew of our arrangement. No one at Bailey Books,

Incorporated, had knowledge of, or participated in, my scheme.

I am aware that my conduct is illegal, and that it violated the policies of Bailey Books,

Incorporated. I participated in this scheme because my husband and I were having severe

financial problems tied to his business. My husband is not aware of this matter. I am truly

sorry for my conduct, and I promise to repay any resulting damages.

I have read this statement, consisting of this page. I now sign my name below to affirm that

this statement is true and correct to the best of my current knowledge.

Signature

Witnesses:

SUMMARY

Nothing is more important to the successful resolution of fraud allegations than the ability

to conduct penetrating and legally binding interviews of witnesses and suspects. Regardless

of the type of interview being conducted or who is being interviewed, there are five types of

questions that can be asked.

Introductory questions set the tone of the interview, and provide a way for an interviewer

to introduce the subject matter being discussed. Informational questions are at the heart of

the interview. If you have no reason to believe that the witness is providing false

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information, and if the person being interviewed is not suspected of wrongdoing, closing

questions are asked in order to close the interview. Should the purpose of the interview be

to obtain a legally admissible confession of guilt, you will ask assessment questions rather

than close the interview; these questions are designed to give you an idea of whether the

subject is prone to telling the truth. Admission-seeking questions are constructed in a

certain order to improve the likelihood that a subject will confess to wrongdoing.

Because lying does not come naturally to most people, they give off both verbal and

nonverbal clues to deception. You must be alert to these clues during the interview. If a

subject confesses to wrongdoing during the interview, you should reduce the verbal

confession to writing.

ESSENTIAL TERMS

Norming or calibrating

The process of observing behavior before critical questions are asked, with the purpose of

helping to assess the subject’s verbal and nonverbal reactions to threatening questions.

Oaths

Certain phrases used frequently by liars to add weight to their false testimony. Examples

include “honestly,” “frankly,” “to tell the truth,” and “I swear to God.”

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Character testimony

An attempt by a witness to add credibility to a lie by requesting that you “check with my

minister” or “ask my wife.”

Illustrators

Motions made, primarily by the hands, to demonstrate points when talking. The use of

illustrators is usually altered during deception.

Anatomical physical responses

The body’s involuntary reactions to fright; they include increased heart rate, shallow or

labored breathing, and excessive perspiration. These reactions are typical of dishonesty.

Manipulators

Motions made by individuals such as picking lint from clothing, playing with objects (such

as pencils), or holding one’s hands while talking. Manipulators are displacement activities,

ways of reducing nervousness.

Fleeing position

A posture adopted by an individual under stress during an interview. The head is facing the

interviewer, while the feet and legs are pointed toward the door in an unconscious effort to

flee the interview.

Benchmark admission

A small admission made to wrongdoing that signals a subject’s willingness to confess. It is

made as a result to an alternative question posed by the interviewer that gives the subject

two ways to answer, either of which is an admission of culpability: “Did you just want extra

money, or did you do this because you had financial problems?”

Excuse clause

A clause inserted in a signed statement that encourages the confessor to sign the statement.

It offers a moral, not legal, excuse for the wrongdoing: “I wouldn’t have done this if it had

not been for pressing financial problems. I didn’t mean to hurt anyone.”

REVIEW QUESTIONS

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15-1

15-2

15-3

15-4

15-5

15-6

15-7

15-8

15-9

15-10

15-11

15-12

15-1

15-2

15-3

15-4

15-5

15-6

(Learning objective 15-1) What are the five types of interview questions?

(Learning objective 15-2) What four steps are involved in introductory questions?

(Learning objective 15-3) What topics should be covered during informational

questioning?

(Learning objective 15-4) When should open questions be used?

(Learning objective 15-4) When should closed questions be used?

(Learning objective 15-4) When should leading questions be used?

(Learning objective 15-5) What are the purposes of closing questions?

(Learning objective 15-6) What is the purpose of assessment questions, and when are

they asked?

(Learning objective 15-7) What are some nonverbal clues to deception?

(Learning objective 15-8) What are some of the verbal clues to deception?

(Learning objective 15-9) What are the steps used in admission-seeking questions?

(Learning objective 15-10) What are the key elements of a signed statement?

DISCUSSION ISSUES

(Learning objective 15-1) Why are all five types of interview questions not used in all

interviews?

(Learning objective 15-2) Why are introductory questions so important to an interview’s

success?

(Learning objective 15-3) If the witness becomes difficult during the informational

phase of an interview, how should this be handled?

(Learning objective 15-4) Why does the interviewer not use closed or leading questions

during the information-gathering phase of the interview?

(Learning objective 15-5) Why is establishing goodwill with the witness important

during the closing phase of the interview?

(Learning objective 15-6) What is the theory behind how assessment questions work?

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15-7

15-8

15-9

(Learning objectives 15-7 and 15-8) What is the connection between calibrating a

witness and verbal and nonverbal clues to deception?

(Learning objective 15-9) Why are admission-seeking questions asked in a specific

order?

(Learning objective 15-10) Why is the excuse clause used when preparing a signed

statement?

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CHAPTER 16: OCCUPATIONAL FRAUD AND ABUSE: THE BIG PICTURE

LEARNING OBJECTIVES

After studying this chapter, you should be able to

16-1 Understand and describe abusive conduct

16-2 Determine why attempting to achieve perfection in the workplace is not desirable

16-3 Explain the obstacles to accurately measuring the level of occupational fraud and

abuse in organizations

16-4 Determine why greed is an inadequate explanation for occupational fraud and abuse

16-5 Explain the concept of “wages in kind”

16-6 Compare and contrast fraud prevention and fraud deterrence

16-7 Explain the significance of the “perception of detection”

16-8 Identify some of the factors related to increasing the perception of detection

16-9 Explain the relevance of adequate reporting programs to fraud deterrence

16-10 Understand the implications of the Corporate Sentencing Guidelines

16-11 Understand ethics and ethical theory

DEFINING ABUSIVE CONDUCT

The cases we have seen on the preceding pages were, by and large, on the extreme edge of

abusive conduct by employees. In short, this data is merely the tip of the iceberg. How deep

and massive that iceberg is varies from one organization to another, depending on a

complex set of business and human factors.

The depth of the iceberg is also measured by what is defined as abusive conduct. Obviously,

the more rules within the organization, the more likely employees are to run afoul of them.

A study by Richard Hollinger and John Clark revealed that almost nine out of ten employees

admitted to committing abusive conduct at some level. Part of that abuse is owing to the

diverse nature of individuals. Tom R. Tyler, in his book Why People Obey the Law,

concluded overwhelmingly that individuals obey only laws they believe in. If a rule makes

no sense to employees, they will make their own.

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Let me illustrate the point with another personal experience from the FBI. The FBI did a

thorough background investigation before they hired me. They investigate each and every

agent prospect. When you are hired, it doesn’t mean you’re perfect—just that they have put

you through every wringer they can think of, looking for any imperfection that may surface

to disqualify you.

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