The interviewer role for a Forensic Accountant!

In order for evidence to be admissible in court, it must be relevant and not outweighed by countervailing considerations. Forensic accountants need to take into considerations the legal and ethical aspects in order to ensure the evidence and statements they obtained are admissible. Scott Porter even suggests a new standard for forensic accountant that ensures that such model addresses ethical, legal and psychological aspects. 

There are a number of techniques that forensic accountants can utilize to gain evidence and statements.These include the REID technique, PEACE and Motivational Interviewing.

I will focus on PEACE and Motivational Interviewing in this blog. The REID technique has been controversial and attributed to psychological coercion. Among many famous cases, including the Central Park Five, the REID technique has produced numerous false confessions. The integrators refusal to listen to the denial of the suspect creates the feeling of hopelessness which leads to short term thinking.   

Similar to a journalistic approach, the PEACE technique aims to gather information and evidence by focusing on content than non-verbal behaviour and encourages the interviewer to ask open-ended questions. The use of open-minded questions has been linked to "fuller and more accurate" accounts from the interviewee. 

Motivational Interviewing follows four principles: empathy, develop discrepancies, roll with resistance and support self-efficacy. This style of interviewing is based on the concept that confrontation will make a suspect defensive and a confession comes from "within" fraudster. So the interviewer has to guide the interview in a way that the suspect will choose the "correct path". Russell Williams' confession was attributed to MI.    

Thankfully I have not been interviewed or interrogated for any fraud. In my first professional interview for a job at a big accounting firm, the interviewer confronted me about a "Fail" on my academic transcript. His accusatory tone made me very defensive. Although the real reason I failed was both genuine and acceptable I felt I had to come up with an impressive tale for it to be accepted.     

References

http://www.newyorker.com/magazine/2013/12/09/the-interview-7

https://www.law.cornell.edu/wex/admissible_evidence

http://www.nova.edu/gsc/forms/mi_rationale_techniques.pdf
http://theconversation.com/the-psychology-of-interviewing-suspects-from-woolwich-to-boston-14827
http://www.reid.com/pdfs/peacearticle.pdf 
http://www.acfe.com/uploadedFiles/ACFE_Website/Content/canadian/2013/presentations/5B-Scott-Porter-cpp.pdf

Social Media - A fraudster's playground?

Recently, an interesting article in Securityweek likened social media to a fraudster’s playground. It's a platform that connects billions of people, allowing attackers to perform a number of activities from just a troll to committing far more evil crimes.   

For an individual, social media poses many risks. Using a tactic called “gatekeeper friends”, where the hacker connects with friends and colleagues to appear more legitimate, deceiving a potential target has never been easier. Sharing information such as your full name and birthdate allows hackers to commit identity theft by creating your online portfolio and using it to open bank accounts and get credit cards. Photo sharing sites like Flickr and Instagram are also a hotbeds for identity theft. Your home and work addresses can be identified when location is enabled on your posts.

The risks faced by companies are quite different. Social media has allowed users to directly access companies social media accounts This allows them to post unfavourable feedback and hijack the account. Examples include the 2010, Tourism Australia’s  $150 million media campaign “There’s nothing like Australia” which was “brandjacked” by the Kiwi twitter users.   

 

Sensitive information of the company can be compromised by employees using sites that they think are protected. CEO’s can reduce fraud, bribery and corruption though social media within their organisation by performing risk assessments and enforcing a social media policy.

I still haven’t fallen victim to any social media frauds. However, when I was about 15, I did accept the request from a “gatekeeper friend”. With 9 mutual friends I thought the profile was legitimate. The profile picture of a car should have given it away. He turned out to be a relative who wanted to ensure I was safe online and knowing I wouldn't accept his request, he created the account. If indeed it was a hacker, he/she could have remained dormant and used all the information I posted for sinister activities. It just goes to show how naivety and wanting more “Facebook friends” can get you into a lot more trouble.

Reference List

http://www.securityweek.com/match-made-heaven-fraud-and-social-media  
http://www.eonetwork.org/octane-magazine/special-features/social-media-networks-facilitate-identity-theft-fraud  
http://www.lloydsbank.com/help-guidance/security/social-networking.asp 
http://www.identityguard.com/identity-theft-resources/articles/How-Oversharing-on-Social-Media-Can-Lead-to-Identity-Theft 
http://www.socialmediatoday.com/content/security-threats-businesses-face-social-media

Could Theories explain the increase of fraud, corruption and bribery?

Cressey’s Fraud Triangle outlines 3 factors must be present for a person to commit fraud. Pressure, rationalization and opportunity. The General Strain Theory and the Differential Association Theory also explain why certain people are more inclined to commit a crime.

The Strain Theory argues that people engage in deviant behaviours when socially approved goals are unattainable through legitimate means. He believed that members of lower socio- economic groups were prevented from achieving monetary success through the lack of skills and attitude.

The Differential Association Theory was proposed by Edwin Sutherland. In short, his theory argued the following:

1.       People tend to adopt the learned attitudes, beliefs and values of a certain subgroup.

2.       Crime occurs when the norms of the subgroup conflict with the majority.

3.       Criminal behaviour is learned through  the interaction with other people.

4.       Techniques of committing crimes, motivations, rationalization and attitude of committing a crime is learned through intimate interaction with a certain group.

Two people that join two different groups; lets say scouts and a street gang, will have acquired different attitudes and skills. The sense of belonging is a human need and through the groups we belong to, we either deviate or conform to societal norms.    

Both these theories ring true to the Cressey's Fraud Triangle. The General Strain Theory tends to describe how interpersonal and impersonal pressures causes individuals to commit fraud. While the Differential Association theory explains why the beliefs and rationalization in a group lead us to commit fraudulent activities.  

Reasons why fraud, corruption and bribery are increasing:

-          There is more financial pressure

-          Internet and business online

I agree to an extent with the theory proposed by Sutherland. Quite a while back I was employed at a discount department store where a particular manager ill treat the junior staff. I never disliked him that much but the general consensus of him from my friends really made me dislike him to the extent that I resigned. Never underestimate the power of social influence. 

References

http://www.acfe.com/fraud-triangle.aspx   

https://www.youtube.com/watch?v=1fsTFx6xZ2M

http://study.com/academy/lesson/mertons-strain-theory-definition-examples-quiz.html

http://www.sagepub.com/haganintrocrim8e/study/chapter/handbooks/42347_7.1.pdf

http://www.d.umn.edu/~bmork/2306/Theories/BAMdiffassn.htm

Being a Forensic Expert Witness for a day!

Recently, our class participated in a mock trial. I was praying I would not get called up. But with my luck, I knew I'd be in the witness box soon. We all ended up being expert witnesses. It was truly the most terrifying experience I have had at uni but in hindsight, a very valuable 5 minutes. So here's my experience on being an expert witness!  

QUT Law Moot Court

For all those who think being an expert witness is fun, exciting and glamorous, I would beg to differ. Nerves meant that the most basic question was incoherent. As the barristers explained, forensic expert witnesses are mostly only just one part of the puzzle. There are many other professions that are a part of trial. And the barristers run the show!  

Recollecting from my rather short career, here are my recommendations for you all you budding forensic expert witnesses out there.

•   Know your report inside and out! Back to front! I learnt this the hard way. In the mock trial, the judge called me up to the witness box. However, both the prosecution and defence mistakenly examined and cross examined on a part that was not allocated to me. Even though I had read over that section, I wasn’t fully prepared as I was for my section. It felt like even the prosecution was cross examining me.  Know your material, otherwise you won't come across as much of an expert. 
  

•  Don’t be too defensive of your report. Although it is instinctive to defend your own work, this may make the judge not trust you as a witness.

• Duty to the court. Your duty as the forensic expert witness is to the court, not to your client. Be impartial. 

•  Good communication skills.

•  Know the rules of the court. Not all case ends in court. However, if it does, it may be beneficial to be aware of court procedures.
• Do not give into concessions. 
• Talk and engage with the judge and tell the court. You need the judge to trust you. 

The mock trial clearly showed that it is indeed not the expert witness that runs the shows, the barristers were the ringmasters.The judge made it clear not to take the cross examination personally however I'm sure it nearly reduced a lot of people to tears. It certainly was not for the faint hearted!

It was not an exciting experience but it taught me why witnesses often recall being in the witness box the worst day of their life. As interesting as the proceedings was, I think the daunting aspect of giving evidence has put me off ever becoming an forensic accountant. Maybe with more experience, my attitudes will change 20 years down the line. Until then, I’m happy being behind the desk than inside the witness box.  

Interesting Reads

http://www.flexstudy.com/catalog/schpdf.cfm?coursenum=95063 

Hot Tubbing

“Hot tubbing” or concurrent evidence. It is the practice where several expert witnesses are put on the stand together to save both time and resources. Hot tubbing is different to the "adversarial system" courts utilities in that judges question the expert instead of the counsel. But is it really worth it? 

 

The pros!

• The judge, juries and the court have the opportunity to listen to the experts discussing the issue and his/her point of view in the discussion. This can reduce the likelihood of misunderstanding the expert.
•  All experts will be giving evidence on the same assumptions
•  Allows experts to challenge each other 
•  Experts will be more careful knowing their colleagues will point out errors and exaggerations instantly. Whereas this could take days to be pointed out in cross examination.
•   Less time spent on cross examination
•   Reduce court time and costs
•  Experts may be reluctant to be cross examined by a hostile barrister but more open to a discussion with an expert

The Cons!

• There is potential for an more persuasive, confident or assertive expert witness to overshadow or overwhelm other experts and win the minds of the judge/jury
•  Due to time constraint, the discussion may remain at a superficial level
• Process could become too adversarial
• May encourage counsel to “audition” the best experts
• The process of hot tubs can vary between judge or tribunal 

Although hot tubbing has its advantages, I do not think it outweighs the negatives. The best speaker could easily manipulate the judge or jury as people have the power to influence others. I can recall numerous times when people have influenced my previous stance on major debates leaving me to second guess myself. Whilst at school, I participated in the Queensland Debating Union competition. Strong confident opponents had me questioning my position of controversial topics. I have often changed my views to fit in with people in case I comes across as "stupid". More reserved but experienced experts could be marginalized by less experienced but outspoken ones.    

References
http://www.fedcourt.gov.au/publications/judges-speeches/justice-rares/rares-j-20131012 
http://www.theglobeandmail.com/report-on-business/industry-news/the-law-page/why-judges-like-hot-tubbing/article577733/
http://www.pannone.com/media-centre/articles/medical-negligence-articles/hot-tubbing-for-expert-witnesses