Scammers, victimize businesses, private individuals, government agencies with their small to very large scale schemes. They run the loan scams, fraudulent investment schemes, the pyramids and ponzi schemes, the telemarketing frauds and fraudulent insurance schemes causing billions in damages every year. Contrary to “traditional” criminals who may commit their crimes triggered by a perceived pressure (for instance to finance an addiction, out of economic distress) scammers are more often than not of an opportunistic nature. In many handbooks and articles on fraud and fraudsters you will find some reference to the subject matter of “NEED OR GREED”.
I think I can confidently say that the swindler, con artist, scammer or whatever you want to call them will fall into the category “greed”. They run their schemes because they make a lot of money and it is easier than working to make a living. Marks are easy to find as their are plenty of gullible people around. (Mark is jargon for a potential victim). Just look at Madoff, there were people actually begging to have their money invested through him.
At one point or another, victims of these scams get a feeling that something is wrong and start asking questions.They find out that they have been scammed and try to confront the scammer. If they are as lucky to get in touch find they con artist (many flee the scene before that), they will see their persistence often met with feigned bewilderment, amazement about the size of the ‘misunderstanding’ or even aggressive responses as to daring to even suggest that the con artist involved is anything but professional and highly ethical.
Good at what they do; manipulate, many of these scamsters find a way to convince their victims that nothing is wrong, that no harm was done or that no loss suffered or that any loss suffered is not the result of fraudulent or negligent misrepresentations. Some of them almost seem to believe genuinely that they did not do anything wrong. Others eventually blame it on the victim themselves for being so gullible.
Throughout a conversation with the French-born con artist, which was taped from a British Columbia jail cell where he awaited trial for participation in a B.C. business scam, Christopher Rocancourt argued that reneging on a loan is not a crime. Rocancourt is also wanted in Europe and the U.S. for fraud and theft involving millions of dollars. Mr. Rocancourt does all he can in the interview to convince viewers he is a far cry from the heartless criminal police have portrayed him to be. In fact, if anyone is to blame for the victims’ losses, he says it is the victims themselves. After all, they were gullible enough to believe him. (Source http://www.subtleny.150m.com/Chris/National%20Post%204-13-02.htm)
Scammers have an ability to be charming, manipulative, persuasive and authoritative. That’s how they win your trust, that why they are successful at what they do. They are master liars, with no empathy for their victims whatsoever. That same persuasiveness is what makes the scammers a more challenging subject of an investigative interview and criminal investigative agencies or prosecutors are more than once discouraged from (further) investigation or prosecution. Having to prove criminal intent is seen as a considerable barrier and challenge.
What makes things easier is that scammers are often so confident in their own skills and ability to manipulate others that they will be happy to agree to an interview. During the interview, you will be measured to see what your level of expertise is. Expect to be bombarded with jargon and figures. This helps the scammer in his or her attempts to convince you that things are all a misunderstanding. What has helped is that as a private sector service provider you can come from a position of interest or trying to get the facts together and understanding the situation as opposed to a law enforcement interrogator.
Over time two key factors have proven to be of key importance in relation to these type of interviews:
- thorough preparation; and
The problem or I should say challenge with scam artists is that contrary to for instance internal fraudsters or employee thieves it is more difficult to bring them back to the point where they crossed an internal moral barrier. Employee thieves or internal fraudsters are more easily brought back to that point where – driven by some perceived need – they crossed the line knowing fully well that what they were doing was illegal. This causes a certain anxiety that is subsequently rationalized away so as to ease that anxiety. Bringing them back to that point sometimes makes them confess and get rid of their feelings of guilt. This is different for the scammer who simply does not think anything of ripping others of their money or even life savings. They have no need to rationalize. Bringing them back to that point of anxiety is not even possible: there is none!
The ideal outcome of the interview (after you have convinced yourself that the facts gathered so far indeed constitute a scam) would of course be a signed confession as that would speed things up nicely. However, going into the interview with a confession in mind only is not recommended. Confessions are rare and the exception sooner than the rule. Even without a confession though an interview can still be very valuable as it offers an opportunity to further built a case, gather additional evidence to get more clarity for the prosecutor or litigator to formulate charges or claims or obtain evidence that could prove intent.
Especially in criminal cases the challenge is in proving “criminal intent”. Witnesses other than the scamster can hardly assist in proving the intent. Usually you are confined to documents and statements as circumstantial evidence to prove intent and the statements of the scam artist him or herself can make a valuable contribution thereto. His or her admissions, false explanations, excuses or denials of intentional misrepresentations may end up being one of your more valuable assets in building a case. This does not just concern their representations but also, and equally important, their attempts to cover up their misdeeds.
Before interviewing a scammer you will need to be thoroughly prepared especially when confrontation is to be expected. This means that you will need to:
- debrief witnesses as thoroughly as possible;
- obtain and analyse the documentary evidence;
- internalize all the ins and outs of the scheme including the relevant associated legitimate financial or business concepts on which the scam is based, the relevant laws and regulations and industry best practices and standards;
- where possible anticipate what excuses may be expected so as to be prepared for them and being able upfront to debunk them. Whether you will or will not during the interview is not the key question at this point;
- A review of the background of the scamster and his business activities (business documentation, financial information, credit reports, educational backgrounds, involvement in other schemes or business ventures, court reports, complaints etc);
It has helped me tremendously in the past and present as part of the preparation to collect and document verbal and written representations made to victims (telephone notes, meeting notes, emails, letters, taped telephone recordings and promotional materials). It makes it easier to ask the scammer about these representations and where certain excuses are brought up they may well add to proving intent. Prepare an interview schedule either on paper or get it in your head, that covers all relevant facts and elements of the scheme as well as potential escapes.
Where a law enforcement officer you may well have possibilities obtain a lot of documentary evidence from the suspect directly upfront, prior to the interview those in the private sector may not and often do not have that possibility. There is a wealth of information available via all kinds of open, public and paid sources online as well as off line. If you are in a position to do so (as there may be budgetary constraints on the part of your client), obtain as much of the business documentation and financial information as possible and allowed for in preparation of an interview or in conjunction with other evidence to obtain a pre-trial court order for further evidence from the interviewee. In these cases the deep understanding of the scheme and following the the money trail as far as possible is often the key to success; to your interview and in building a solid case.
Initially you try to schedule an interview with the scammer, which is sometimes a challenge in itself where some of them make it a habit to disappear on a regular basis, claim unavailability or cancel appointments. An option is to visit the scammer unannounced, which has a risk of being sent away to come back another time.
At the interview itself, introduce yourself properly and explain the reason for the interview. Also explain to the interviewee that he is not obliged to cooperate or being interviewed. Usually the reason or the interview is that complaints have been received and that you would like to discuss the matters raised. It is my experience that scam artists do not mind sitting down with you even if that is for an extended period of time. Where the scam artist is not prepared to cooperate with an interview it is up to the investigator to convince the scam artist of the importance of cooperation and how this is not in your but his or her best interest.
Regardless of the issues involved stay professional and polite at all times and prevent coming across as accusative. Good manners go a long way in building rapport and trust and helps in getting the best out of the interview.
Throughout the interview, patience is your biggest ally. Allow the scammer to explain the ins and outs of the scheme he or she has been promoting and the representations made to victims, be a listener not a talker. The scammer will try and find out what you know in any event so make sure that what you give away is as little as necessary. Confidence and underestimating the level of knowledge of the interviewer will likely make the scammer give away more than he should have as a result of overconfidence in his own abilities to manipulate. Furthermore, as part of their ways, these scamsters have a habit of wandering off and give long winded answers lacking coherence to initially straightforward questions. Be prepared to keep on listening and concentrated for long periods of time while guiding the subject back to the matters at hand subtly. Avoid to stand up against what you know to be pokey stories. Keep your cards to yourself and let the scammer do the talking. Confrontation can come at a later stage.
Over the years I have made it a habit to accept all initial answers to my questions and keep any confrontation with inconsistencies for a later stage of the interview. In some instances it has been necessary to split the interview in two separate interviews, although I consider that not to be ideal. Letting the scammer do all the talking helps in that you can close doors (areas that offer a way out) while doing the interview and when you do arrive at the inconsistencies in previous statements and confrontational aspects of the interview it will be harder for the scammer to explain his prior statements. Focus on extracting, detailing and documenting the scamsters descriptions of relevant facts and contacts with victims. It is advised sometimes to leave questions about the scammer’s background to a later stage of the interview.
I would have to say that at least part of these questions, such as business background and education may well be used as part of building rapport with the scammer by creating an air of genuine interest not just in the transactions but also the scammer as a person. It may serve as a tool to hide your level of knowledge in the initial stages. I guess this is a matter of how you present the questions and intuition. Do make sure however you get a clear view of the scammer’s business and educational background especially in areas related to the scam at hand.
After extracting the complete story of the scammer, the confrontational part of the interview can follow. The scammer is now queried about inconsistencies and discrepancies. To prevent the scammer from closing up on you, start with smaller ones and take you time to build up the pressure. Again, don’t make accusations, instead ask for explanations because it seems that prior statements are inconsistent with what you understand to be the facts. Where required or helpful, confront the scammer with evidence. It is in this stage where questions tend to become of a more closed nature. For instance:
“You told some of the parties involved as an investor in this opportunity that building could start as soon as the investment sums were received. Correct? You also told the parties that this was the second round of investments and that the development was already well underway. Correct?” You then confront the scammer with a very recent photo of a bare piece of land where a building project in progress should be happening and the fact that no building consents were granted on the basis of which building could have started.
You could for instance follow up with the question: “You used this money to buy that new Porsche, the boat and making a down payment on the mortgage of that new mansion you are building for yourself didn’t you? (This information can depending on the jurisdiction be derived from open or publicly available sources.) Or… ” You used that money to pay to keep the investors in the other venture <specify> quiet, correct?” Where possible support this with documentary evidence. You will either get an admission or an even more ludicrous bs story.
Keep in mind that confessions by scammers are rare but not impossible. If you are as lucky as to end up getting a scammer to make admissions or confessions on specific elements, make sure you try to obtain the broader confession or admission that would go towards closing the case. For instance:
“When you designed the investment program for development MACS, you were aware of the false or untrue nature of the representations, promises and claims made to investors and in the investors documentation were you not? You knew that making false representations was the only way to get people to invest money in the scheme and that they would not invest in this development if they knew the truth about the development and your intended use of the money. Am I correct?
Should you be as lucky to get to the point of admissions like the ones asked for here, thoroughly question the scammer about all the relevant details of the scam. (Keep in mind the elements of any relevant criminal offenses or civil legal matters that need to be proven). At the same time however; confessions like the ones above are the exception and not the rule with scammers. Some, depending on their level of confidence or arrogance, may see the overwhelming case against them and out of personal interest or in the hope of a favorable deal, cooperate with the interviewer. Others will still refuse to admit to intentionally causing damages to their victims. The documented false representations, explanations and excuses will still serve as evidence for intent and enhance the chances of success in prosecution or litigation.
Probably the hardest part of any fraud or scam investigation is proving the legally required criminal intent. It is exactly this element that causes many cases to end up on the shell or being rejected for prosecution. The burden of proof is high in criminal cases where guilt needs to be proven beyond a reasonable doubt. Whilst civil procedures are based on the balance of evidence, a sufficient amount of negligence or intent will usually still need to be proven. Allowing the scammer room to express his or her false explanations, misrepresentations and excuses assists in documenting intent or negligence. Whether a confession follows or not, at the least it paints a picture of witness that cannot be trusted.
Although it requires a lot of preparation; the thorough and patient approach enhances the chances of a confession. Success!