“It’s not easy butchering people. Its hard work” goes the voice in the trailer for the Netflix series Mindhunter that commenced on 13th October 2017, as a fax of a crime scene photograph emerges from the machine showing the body of a murdered young lady…
This is the adaption of the bestselling true crime book, Mind hunter: Inside the FBI Elite Serial Crime, in which former FBI agent John Douglas highlights how he built a career in criminal profiling by interviewing serial killers to understand their mindsets and behaviours.
This Netflix preview had me thinking that serial killers and occupational fraudsters have 3 traits in common –
- trust violation and
Therefore, we need to understand all three to understand fraudsters actions.
Note: It should be stated that occupational fraudsters do not physically maim their victims, but their actions are destructive to livelihoods and business.
To start like true “behavioural detective”, we need to tap into the basic behavioural science as our modus operandi and the fundamental drivers of human nature depicted by Maslow’s hierarchy of needs, this will assist me to explain the reasons why fraudsters (like serial killers) commit their crimes as follows:
The mind plays a crucial role in our motivations and is driven by emotions aligned to physiological and safety needs as per Maslow’s hierarchy of needs.
The fraudster’s mindset provides rationalisation for committing crime, believing they have been mistreated.
This rationalisation leads to an employee either becoming an accidental fraudster (one off crime) or a predator fraudster (the predator commits serial offences). For example, Bernie Madoff is allegedly stated to believe his Ponzi scheme victims deserved to be swindled as they were over privileged.
Also, Nick Leeson of the Barings rogue trading scandal, who was convinced his fraudulent acts would save his staff’s jobs.
Trust violators take the opportunity to persuade victims that they have their best interests at heart meanwhile it’s deception, like a fox in a hen house.
A good example would be the Bernie Madoff Ponzi scheme using the 3rd stage of Maslow needs – social belonging. This involves tapping into the knowledge of being part of a specific community to gain trust of his victims and capitalising on this trust by providing assurances, making excuses, distracting scrutiny of his actions to achieve fraudulent targets.
The fraudster’s behaviour seeks gratification and domination enforced by social engineering.
Bernie Madoff had control over the activities of his clients’ funds with little involvement from external auditors, custodians etc and an aura of mystery which should have been a Red Flag. He used his position of trust and status as a founder of NASDAQ to dismiss all challenges of his behaviour.
This alternative behaviour is formulated by the lack of empathy therefore affecting their behaviours – for example the serial killers lack of empathy is from childhood linked to their strict or absent MOTHERS as stated by FBI analysis, while for fraudsters the need to make up for a perceived gap in their self-actualisation.
In a nutshell
These 3 traits of warped mindsets, trust violation and un-empathic behaviour plays on societal weakness like how a serial killer operates as per the bestseller Mindhunter.
This creates PSYCHOPATHS.
In business, predator fraudsters can be termed industrial/occupational psychopaths aka snakes in suits* with a “me, myself and I” ideology such as Robert Maxwell of the Mirror Group pension fund debacle or Bernie Madoff.
Furthermore, industrial psychopaths have the following traits like a serial killer:
- Amoral and anti social behaviour
- Extreme egocentricity and absence of empathy
- Inability to form meaningful personal relationships
As Bill Tench, a character in the Netflix series, Mindhunter stated, “How do we get ahead of crazy if we don’t know how crazy thinks?”.
Hence, we can infer understanding behavioural red flags and accompanying profiles are vital to understand a fraudster / criminal; as to catch a thief one must think like a thief…to understand the mindset we need to understand the actions.
* The term Snakes in suits is derived from the book Snakes in a Suit: When Psychopaths go to work by Dr Paul Babiak and Dr Robert Hare.
Author: Francis Itoadon
Director, Blackstone Advisory with 16 years experience in Internal Audit and Financial Crime across varied sectors and institutions.