Page 14 - Deception at work all chapters EBook

Introduction 5

COST OF LIES AND PERSONAL LIABILITIES

Increasingly managers are being held personally liable for their alleged errors and omissions
at work. Despite everything, Barings, like many victims of catastrophic fraud, was a very
good company. Many good managers lost their jobs and, in another banking case, the Head
of Compliance – who was an honest, hard-working man – was banned from his profession for
life. True, the good managers who lost their jobs did not ask the questions they should have,
but it is easy to be wise after the event. So what?

COST OF LIES TO ACCOUNTING FIRMS

Nearly every large accounting firm is now embroiled in legal action for alleged negligence
in not recognizing the symptoms of fraud. The average claim per case is over $480 million.
Arthur Andersen was put out of business with the loss of hundreds of jobs and many personal
disasters. So what?

During 2002, following multiple scandals and false reporting by leading companies, stock ex-
changes throughout the world collapsed. One observer pointed out that accountants did far more
damage to confidence in the financial markets than Al Qaeda. Pension funds have collapsed
under the weight of false reporting, leaving an aging population exposed to poverty. So what?

COST OF POLITICAL LIES

Never has the public had such little confidence in our political leaders. The idea that truth can
be ‘spun’ to mislead has become the norm and blatancy the benchmark. Case after case – of
political leaders with their hands in the cookie jar – merely scratch the surface of corruption
at the highest levels. This happens while the poorest members of society suffer.

Frauds in and against government bodies, such as the European Union, the Benefits
Agency, and the Department of Health are totally out of control, despite endless ‘initiatives’
and spinning to the contrary. So what?

COST OF LIES IN CIVIL LITIGATION

The cost of civil litigation in the UK resulting from alleged breaches of contract, failure and mis-
understandings runs into billions of pounds each year. Most are the result of someone being de-
ceived. The idea that every citizen should have equal access to justice is a very sick joke. The legal
aid system is woefully ineffective and the litigant with the most money usually wins. So what?

COST OF LIES TO LAW ENFORCEMENT

For law enforcement agencies, the cost of contested cases is staggering. It is estimated that the
majority of a detective’s working day is wasted on administrative and support duties rather
than on chasing down crooks and questioning suspects. Many cases reported for prosecution
are dropped before trial and if a contested case goes forward, the time spent preparing for
hearings, waiting around for proceedings to start and attending them is beyond belief. Even
if the villain is convicted, the penalties are usually more derisory than a deterrent, with one
judge recently saying that he could not impose a custodial sentence because the jails were
overcrowded. So what?