The term rationalisation is often used to denote a “process of locating a logical or socially acceptable excuse for questionable behaviour and, in particular, thoughts or decisions to perform or engage in that behaviour”[1]. Rationalisations for fraud can vary widely depending on the individual, his circumstances, and the specific context of the fraudulent act. People often employ these rationalisations to justify their fraudulent behaviour to themselves, to others, or both. Some of the most common rationalisations follow:
1. Financial desperation
This theme was heavily emphasised in Part 2, in which we explained the motivations for fraud. As noted, some individuals may feel that they are under extreme financial duress, and unable to share this problem, and therefore commit fraud as a way of alleviating this pressure. Though it is a motivation for fraud, it also falls under the category of rationalisation as, during, or even well after the crime has been committed, the perpetrator may continue to convince him/ herself that his /her actions were righteous, as they were a means of survival.
2. “The greater good” mentality
Also known as the Robin Hood or the Good Samaritan mentality, the individuals with this state of mind are convinced that their actions were somehow benefiting the less fortunate or balancing the scales of social justice. They may also have been attempting to right a perceived wrong or seek revenge against a person or entity they believe had wronged them. This can sound like: “I’m levelling the field” or “They deserved this” or “They owed us this”[2]. Notice how this puts psychological distance between the perpetrator and the victim/s. Wallang and Taylor call this process ‘neutralisation’[3].
3. Pressures from within
Within certain groups or organisations, there can be a culture of tolerance or even encouragement of fraudulent activities. Individuals may rationalise their actions by conforming to the norms and values of their group, and may verbalise this as, “Everyone was doing it.” What may worsen this scenario is, if those in executive or managerial positions also appear to be engaging in unscrupulous activities, thereby instilling the delusion that the act is not only normal, but is acceptable too[4]. Another internal pressure may be the fear of adverse consequences, such as losing one's job or reputation, which can lead individuals to try to justify their fraudulent act as a means of self-preservation or avoiding punishment.
As a whole, it seems as though most rationalisations come across as either moral justifications of personal integrity, denial/displacement of responsibility, dehumanisation of the victim, or the downplaying of the outcome (i.e., “It wasn’t that bad”; “No one would have even noticed”). It is important to remember that none of these rationalisations are morally or legally justifiable, but rather reflect the cognitive distortions and self-deception that individuals may use.
In concluding our 4-part series, we note that while the easiest way to combat fraud is to reduce the opportunities available (refer to Part 3), understanding the motivations and rationalisations behind a perpetrator’s actions will assist greatly in creating an effective fraud-deterrent system. We trust that these articles have been both informative and enlightening, and welcome any further questions of clarity.
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References
[1] Klenowski, P. M., & Copes, H. (2013). Looking Back at Other People’s Money: A Qualitative Test of Cressey’s Classic Hypothesis of Trust Violating Behaviour. Journal of Qualitative Criminal Justice & Criminology, pp. 4
[2] Mintchik, N. (2019). Rationalizing Fraud - The CPA Journal. [online] The CPA Journal. Available at: https://www.cpajournal.com/2019/04/15/rationalizing-fraud/
[3] Wallang, P. and Taylor, R. (2012). Psychiatric and psychological aspects of fraud offending. Advances in Psychiatric Treatment, 18(3), pp.183–192. DOI: https://doi.org/10.1192/apt.bp.111.008946
[4] Schuchter, A. and Levi, M. (2013). The Fraud Triangle revisited. Security Journal, [online] 29(2), pp.107–121. DOI: https://doi.org/10.1057/sj.2013.1 pp. 7