Criminal minds: profiling architects of financial crimes
| Published date | 03 February 2021 |
| Date | 03 February 2021 |
| DOI | https://doi.org/10.1108/JFC-11-2020-0221 |
| Pages | 324-344 |
| Subject Matter | Accounting & finance,Financial risk/company failure,Financial crime |
| Author | Shazeeda Ali |
Criminal minds: profiling
architects of financial crimes
Shazeeda Ali
Faculty of Law, UWI, Kingston, Jamaica
Abstract
Purpose –The purpose of this paperis to construct a profile of a financial criminal, with special emphasis
on their psychologicalattributes. The objective is to determine if such a profile can provide a valuable tool for
detectingperpetrators of financial crime and for implementing risk-reductionstrategies.
Design/methodology/approach –The approachinvolved a review of various personality disorders and
other mental health issues, as wellas an analysis of a number of cases involving serious financial crime, to
ascertain whether the behaviourof the perpetrators was consistent with certain psychological challenges.In
addition,the study examined various motivators for the commission of the financialcrime.
Findings –The research revealed some key commonalities among the perpetrators of financial crime and that
their behaviour was often consistent with that of a person afflictedwithapersonalityorotherpsychologicaldisorder.
Originality/value –The study provides a comprehensive analysis of various personality and other
psychological challenges afflicting a number of offenders involved in financial crime. It also provides some
critical findings that could be valuable for thosecharged with establishing measures to prevent and detect
financialcrime.
Keywords Mental health, Personality disorder, Corporate psychopath, Psychological profile,
Financial criminal, Insanity defence
Paper type Research paper
Introduction
In the popular television series, CriminalMinds [1], the elite special agents of the Behavorial
Analysis Unit (BAU) of the Federal Bureau of Investigation are depicted travelling across
the globe to assist local law enforcement to solve diverse cases involving violent criminals,
including serial killers. In reality, as on film, the BAU is charged withthe task of assessing
and delivering a psychologicalprofile of suspects of violent crimes, to assist in theprocess of
tracking down these heinouscriminals.
A suspect’sprofile is used primarily as a determinant of motive and would involve an
examination of their background, patterns in modus operandi,aswellasvictimology[2], in
which the relationship between an injured party and the offender is scientifically studied.
Importantly, the profile can help the investigator to predict the suspect’s next steps, to prevent
the commission of a crime, as well as apprehend the target of that investigation. It is submitted
that if a psychological profile is a valuable tool in detecting and prosecuting perpetrators of
violent crimes, then a similar tactic should be used in the pursuit of financialcriminals.
Undoubtedly, the inherent differences between violent and financial crimes may pose
some challenges when seeking to create a complete image of the so-called “un-sub”
(unknown subject of the investigation). For instance, apart from fraud, many financial
crimes, including money laundering and insider dealing, do not have an immediately
identifiable victim. The absence of victimology would preclude the investigator from
studying the characteristics of victims and any possible offender-victim interaction, to
discern any commonalitiesamong them.
JFC
28,2
324
Journalof Financial Crime
Vol.28 No. 2, 2021
pp. 324-344
© Emerald Publishing Limited
1359-0790
DOI 10.1108/JFC-11-2020-0221
The current issue and full text archive of this journal is available on Emerald Insight at:
https://www.emerald.com/insight/1359-0790.htm
Nonetheless, the process of profiling financial criminals presents a significant opportunity
for gaining a better understanding of these offenders. This insight should assist in formulating
risk-reduction strategies and contribute to the enhancement of prevention and detection
measures. Of course, this approach would be best suited to interpreting serious, habitual or
“serial”financial criminals, rather than persons who are embroiled in a minor or one-off
transgression.
Part A
Exploring the theories of criminality
Before one begins to paint the portraitof a financial criminal,it is helpful to review a number
of theories advancedby criminologists and sociologists that seek to explainthe reasons why
some persons are inclined to commit financial crimes. The following is a chronological
review of some of the key hypotheses that provide a theoretical underpinning for the
discussion.
Firstly, the differential association theory, propounded by Sutherland in the 1930s,
focuses on how individuals learn to become criminals rather than why they become
criminals. It posits that through interaction with others, individuals learn the values,
attitudes, techniques and motives for criminal behaviour (Vinney, 2019). The differential
association predicts that an individual will choose the criminal path when the perceived
rewards for law-breakingare exceeded by those for abiding by the law (Alexander, 2018). In
other words, criminality is chosen where the “risk to reward”ratio is tilted in favour of the
reward of committing the crime. Criticsof this theory object to its failure to take personality
traits into account(Vinney, 2019).
The renowned fraud triangle theory, developed by Cressey in the 1950s, refers to the three
elements that are typical precursors to fraudulent activity. The three elements of the triangle
are real or perceived opportunity, financial pressure and rationalization. The latter explains
how a potential fraudster justifies the crime before committing the fraud. Even when
opportunity and financial pressure are present, “many fraudsters feel the need to justify their
actions to feel as though they are not social deviants”(Fisher, 2015). According to Cressey, all
three elements must be present in order for a trust violation or fraud to occur.
The neutralization theory is similar to the element of rationalization and was advocated
in the late 1950s by Sykes and Matza. This propositionis that people who adhere to common
beliefs of right or wrong, that were developedin social groups, must find ways to neutralize
their feelings of guilt or shame, to engagein criminality (Fisher, 2015). The core principle of
the neutralization theory is that the rationalization of the crime is paramount to committing
the offence and must occur beforethe crime is committed (Fisher, 2015).
In the 1980s, Albrecht factored personal integrity into the fraud scale to determine the
level of fraud risk. The fraud scale posits thatwhen pressure, opportunity and integrity are
considered at the same time, one can determine whether a situation possesses a higher
probability of fraud (Vousinas, 2019). For example, when situational pressures and
opportunity are high and personal integrity is low, fraud is much more likely to occur than
when integrity ishigh and opportunity and pressure are low (Fisher, 2015).
In the early 2000s, Wolfe and Hermansonintroduced the fraud diamond concept in which
they contend that, in addition to the elements of the fraudtriangle, there is a fourth element,
namely, capability. Thismeans that one must consider an individual’s personal abilities and
attributes, such as skills necessaryto carry out the crime. The creators of this theory submit
that a person can have intent, opportunity and rationalization but, without the ability and
skills necessaryto carry out the crime,the fraud will not occur (Vousinas, 2019).
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