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Decoding the mind of a fraudster

Dr Rajendra Barve a Consultant Psychiatrist (Mumbai, Maharashtra) and HRD trainer tells us if there is a link between psychiatric problems and fraudulent offences.

Written by Medha Deshmukh Bhaskaran | Published: July 14, 2015 1:52 pm
Fraudulent activity is connected with several things like greed, urge to gamble and grandiose perceptions of life.  (Source: Thinkstock Images) Fraudulent activity is connected with several things like greed, urge to gamble and grandiose perceptions of life. (Source: Thinkstock Images)

Open any newspaper and you will see pages filled with scams and frauds happening in the country. Sometimes it is difficult to even comprehend the amount of money involved. Most of us have been cheated many times in our lives, suffered losses and lost our peace.

This is a small effort to know who is liable to commit frauds so that we can take care and steer clear.

Frauds are committed every single moment in the world. Fraudulent activity is connected with several things like greed, urge to gamble and grandiose perceptions of life. Beliefs such as, I deserve this more than them, or, they are stealing it from others anyway, or, they have enjoyed enough, and now it is my turn, or why must someone else get it?

Sometimes it may not be just for financial or even material gain, it may be for a psychological pleasure, feeling of power, enhancement of one’s ego, and a mental ‘high’ from ‘duping’ innocent victims. Most fraud cases appear to have no association with mental illness (but this may not be true). Only a few fraudsters are assessed for mental illnesses. Therefore, the true extent of the contribution of mental illness is difficult to estimate. It is further complicated to assess if the fraudster had a mental illness at the time of the offence and that person (because of his/her mental illness) had the capacity to form criminal intent.

When frauds are committed by a professional (on a large scale) they are known as ‘White Collar Crimes (WCC)’. WCC was first defined by sociologist Edwin Sutherland in 1939 as a crime committed by a person of respectability and high social status in the course of his occupation. But the definition can go beyond that; it may include frauds committed by family and friends, using their knowledge of law (or its loopholes) to gain money or property.

Some need to do it to survive and commit fraud under pressure. It is intriguing that why some hardworking corporate executives suddenly start cheating? Dr Shridhar Ramamoorti – a Scholar of the subject, writes in his paper published in The Psychology and Sociology of Fraud (ACCOUNTING EDUCATION Vol. 23, No. 4 November 2008 pp. 521–533)

Companies do not grow in a constant fashion with each quarter’s results better than last. In the long run conforming to pressures to satisfy the market’s desire for impossible predictability and unwise growth leads to the destruction of corporate value, shortened careers, humiliation, and damaged companies. Along the way, it also leads otherwise honest executives to turn to the dark side. They lie, cheat, and steal in order to relieve the immense pressure to meet analyst expectations of unattainable performance, just to keep their jobs and, thus, for self-preservation. It should be noted that other countries, cultures, and languages provide a context that allows fraud to flourish in perhaps different stripes, shapes, and forms. This is why it is necessary to bring in perspectives from economic/cultural anthropology to understand how white collar crime might manifest itself in other contexts.

Dr Rajendra Barve a Consultant Psychiatrist (Mumbai, Maharashtra) and HRD trainer tells us if there is a link between psychiatric problems and fraudulent offences.

In today’s world we are all vulnerable to frauds while seeking jobs in India or abroad, in process of getting married, while investing our money in different schemes for higher returns, looking for a good insurance schemes, buying property, and some of us who are Non Resident Indians have no idea how to handle the property back home, so we are shown a different picture, and we are misguided. We are all potential victims of fraudsters. Will you please throw some light on the personality of a ‘fraudster’?

Some of them can be very charming. For example – if you are sitting sadly in a corner in a party for some celebration, these fraudsters will approach you and try to cheer you, winning your heart and trust. They have an inborn knowledge of other people’s body language. They can make out your personality and your vulnerability by watching how you react. They will earnestly offer to do several small jobs for you (and they will do it) to solidify your ‘trust’. Once the foundation is laid you will invariably trust him/her more than you yourself. This is the time he/she will strike for a big gain; maybe it is your money or your property.

Does this mean we must not trust anyone?

Trust is double-edged, trust makes life easier. If you trust one doctor and follow his advice, it is much easier to manage your illness, but if you have doubts and suspicions you will run from pillar to post in search of another and then yet another doctor. This will cost money and time. The problem is, if you trust easily, your life gets easier but you also become a potential victim of a fraud.

What do you call such people?

Psychopaths. White Caller Psychopaths. Many of them have Antisocial personality Disorder’ or ASPD. It is a type of chronic mental condition in which one thinks, perceives and relates to others in a dysfunctional or destructive way. Such people have no regard for right or wrong, and often disregard the rights and feelings of others. They also manipulate or treat others with indifference. They lie, may become violent and have problems with drugs or alcohol. ASPD may begin in childhood and these children show cruelty to animals, display bullying behaviour at school, have a tendency to explode in anger, these are early signs of the disorder.

Do all the fraudsters have ASPD?

No, some are very intelligent and are ready to do anything for gain, and such people, who do not have any psychological disorder, and who still misbehave and put others in problem must be punished by law.

Which category our very own Indian fraudsters who initiated the Sarada Scam, Vyapam Scam, Coat Scam, Fodder Scan, 2G Scam, NGO Scams belong to?
Do you expect me to answer that?

With inputs from Psychiatric and psychological aspects of fraud offending
Paul Wallang, Richard Taylor
Advances in Psychiatric Treatment May 2012, 18 (3) 183-192; DOI: 10.1192/apt.bp.111.008946)

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