During the celebrations, there are more opportunities to pick pockets and less chance of getting caught. In the cold light of day, people check their wallets and call the police.
When the latest economic meteorite came to a crashing end in our economic ocean, the wave of fraud started to ripple out right on cue. It’s now reached tsunami proportions.
At the end of last year, we saw a big upturn in people stealing money via fraud because, well, money is in short supply.
It’s going to be in even tighter supply in the coming year. As fraud inevitably rises, compliance team across the industry should brace themselves for a rush of work in 2012.
Who will be carrying out these frauds?
Fraudsters are usually men, with women generally playing only strong supporting roles in this sort of crime, but can come from any level in an organisation.
They fit into two categories.
There is the “accidental fraudster” – the guy who has a business that is going down the pan, is desperate to save it and tries to get the money wherever he can.
Then there’s the “definitive fraudster” who sets out to do it, convincing himself that what he is doing is right. The “definitive fraudster” is a sociopath and a narcissist; he shows no remorse over deceiving people out of their money.
Even when faced with volumes of evidence, an intentional fraudster never admits wrongdoing. He just thinks: “I got caught this time, because I didn’t do the fraud well enough.”
Whatever the motivation, the threat that fraud poses to the mortgage industry demands greater attention.
Sadly, there is a degree of arrogance, naivety and ignorance in some boardrooms. That is bad, because the first line of defence against fraud is awareness among decision makers and those they employ.
In my experience, it is only by involving everyone, from the bottom to the top, that we create completely fraud-aware workforces that understand the need not only to take risks, trust colleagues and drive business success, but are also on guard for dishonesty, whenever and wherever it occurs.
However, we work in a completely interlinked industry and you can’t do business while only relying on colleagues. Inevitably, third parties are involved in mortgage transactions. The answer is to only do business with partners within a trusted community of third-party professionals.
Mark Blackwell is managing director of xit2
