The FBI's Behavioural Analysis Unit ("FBI") made famous in such films as "Silence of the Lambs" and the current TV programme, "Criminal Minds", has turned its attention to white collar criminals.
Following criticism of the lack of successful prosecutions in the wake of the financial downturn, an eight strong FBI team is now looking at profiling fraudsters in the same way that it has done for serial killers and sex offenders.
If such a profile could be developed, it has the potential to become a useful tool in the fight against fraud.
Sherlock Holmes used elements of offender profiling to solve crimes and since then it has reached almost mythical status in TV and movie dramas such as the Granada Television series "Cracker" with Robbie Coltrane, where profilers were portrayed as always getting their man. This image was kick started, in the 1950s, by the remarkable profile provided by the American psychiatrist, James Brussel, on the "mad bomber of New York". For over a decade, the police had been hunting for a serial bomber without success. Brussel produced a highly detailed profile of the bomber right down to the likelihood that he would wear a buttoned up double breasted suit. When he was captured the profile proved to be uncannily accurate, including the "buttoned up double breasted suit". Other high profile successes followed this including the profile prepared by Professor David Canter, the UK psychologist, on "the railway rapist" John Duffy, in the 1980s . This was the first profile prepared for a British police force and it assisted in Duffy's eventual capture. Profiling became popular with the British police thereafter.
However, over the years, profiling has also received much criticism, including that profilers appear to publicise their successes and gloss over failures. In the Rachel Nickell case, the profiler involved was subject to criticism by the trial judge following the acquittal of Colin Stagg. The judge said "The notion of psychological profiling in any circumstances as proof of identity is redolent of considerable danger".
The Association of Chief Police Officers' (ACPO) has issued strict guidance in using profilers, advising investigating officers not to be uncritical of profiles put to them but to exercise caution and remember that such profiles do "not amount to probative evidence."
Financial crime differs significantly from the crimes where profilers have traditionally been used. Instead of a huge population of potential suspects, fraud investigations often involve only a small number of suspects who had the opportunity to commit the fraud. Therefore the traditional profiling of a criminal after the crime is discovered is likely to be less effective in the case of fraud.
However, an alternative application would be to see if it could be used a tool to support a risk assessment of potential or current employees.
The personality traits of those who commit fraud could prove to be a useful pointer to identify potential fraudsters. There has been some research on fraudsters holding high management positions which often characterises them as greedy, charismatic, ambitious and clever. However, this also fits the description of many successful senior corporate executives.
It will be interesting to see whether the FBI can make some progress on developing an identikit for a fraudster. From this, it may be possible to develop personality tests which will highlight those who may pose a greater risk, allowing organisations to potentially mitigate those risks. Keeping a closer eye on the Madoff's and Stanford's might have discouraged them from some of their wilder excesses.
However, there are also those who drift into fraud because they are put in difficult positions. It may be personal financial problems or covering up minor discrepancies which then snowball. Overconfidence that a negative position can be traded out can also lead to a slippery slope of deceit, false accounting and fraud. The FBI may run into difficulties trying to profile such individuals.
Jim Fallon, a professor of Anatomy and Neurobiology at the University of California and the subject of a recent BBC Horizon programme, has carried out some fascinating research on brain patterns. He believes that it is possible to identify, from brain scans and genes, those who lack a sense of morality or empathy - in other words, what he describes as a psychopath. Those he considers to be "successful psychopaths", ie those not predisposed to violence, are often charming, charismatic and manipulative - characteristics of a successful fraudster. In the end, maybe brain scans and blood tests will identify those most at risk to commit fraud. However, therein lies a whole new moral dilemma.
