Emotional Intelligence: The Secret Tool in the Fraud Examiner's Toolbox
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The 2022 ACFE Women's Summit explored many different industry topics in sessions led by experienced professionals to arm attendees with the latest tools to fight fraud — one of which was the importance of emotional intelligence. Mary Breslin, CFE, founder and managing partner of Verracy, led the panel of women consisting of Kathy Lavinder, executive director of Security and Investigative Placement Consultants, LLC, and Nicole Babnick, J.D., HR manager at Consolidated Metco. Together, Breslin, Lavinder and Babnick covered how emotional intelligence can be the next great tool in a fraud examiners tool kit.
The cornerstones of emotional intelligence
Emotional intelligence, also known as emotional quotient (EQ), is the ability to identify and manage one’s own emotions, as well as the emotions of others. One study found that compared to 33 other important workplace skills, emotional intelligence was the strongest predictor of performance, and 90% of top performers have a high EQ. The foundation of many critical skills relies on your emotional intelligence.
In order to improve your EQ, it's important to understand how emotional intelligence is defined and measured. The four cornerstones of emotional intelligence are self-awareness, self-management, social awareness and relationship management. It takes equal understanding of yourself and your emotions, and how others may feel, react and think, to have a high EQ. Having the ability to utilize each cornerstone is the driving force of your EQ and can be the difference in a successful interview or a long-enduring investigation.
How fraud examiners can use emotional intelligence in their work
While needing to be analytical and detail-oriented, fraud examiners must also be able to stealthily get to the root of fraud through conversations and interviews. Navigating conversations with potential fraudsters takes a certain level of empathy and self-awareness. As a fraud examiner, you may step into the room with a bias and recognizing that can bridge the gap in an interview. A lot of fraudsters don’t see themselves as bad people, but good people who did a bad thing — having empathy can help us understand how they rationalize their actions. This will not only lead to a successful interview but can also help determine what steps can be taken to prevent future fraud.
Motivation is a key element in any investigation, and part of discovering a fraudster’s motivation is by being empathetic to their situation. You can have working theories on the motivations, and while you may never fully understand them, it can help you find paths to go down for your inquiry. In order to create an environment where they can explain not only what they did, but why they did it, they first must feel safe in knowing that you can empathize with them.
During the session, Lavinder said it was important to “establish rapport when they have no vested interest in helping you.” Breslin told a story of a former colleague who was able to successfully navigate many interviews and bring about confessions, in part due to his ability to connect on a personal level with the people he interviewed. A junior auditor was sent on an assignment with him, and over time she realized that while he spent time conversing with people, he was able to uncover information and receive help from those who may not have been so willing initially.
We must also remember that fraudsters are not dumb people, and many are able to commit these frauds because they too have a high EQ. Whether they charm people into providing sensitive information or bend the rules and smooth-talk their way out of punishment, fraudsters are able to use relationship management and social awareness to their benefit. Attendees were reminded that EQ is a superpower and those who are experts in emotional intelligence have a leg up in every situation — you will need to be on equal footing with these fraudsters.
A fraud examiner’s journey to honing their emotional intelligence can prove to be valuable in and outside of the office. It’s important to remember that the first cornerstone of EQ is self-awareness; don’t be afraid to recognize your need to improve this skill, after all it is the first step. Lavinder reminded viewers, “developing EQ is not mysterious, just work.” Emotional intelligence may not be the most intuitive skillset, but it’s a worthy tool to have in your investigations.
