We cheat because we can - always have and always will
Published 06/08/2014 | 02:30
Variations of this adage are used by most financial services companies today - and with good reason; we are all prone to cheat, which is why we need oversight.
It was ever thus. Fraud is an endlessly fruitful plot line in literature. Fans of Dickens and other 19th century Victorian writers will know that embezzlement, swindling and fraud are found in many plot lines. Those who read the financial pages of this newspaper will know that nothing has changed. From the spectacular swindles of the US and Irish banks which encouraged thousands of customers to cheat all the way to Bernie Madoff, or jailed former TD Ivor Callely, everybody is at it.
Of course, we tend not to cheat on the scale of the banks which encouraged hundreds of thousands to avoid DIRT tax, but this does not mean we are lily white.
Who has not made a personal phone call or photocopy at work? Or downloaded a film illegally? Does anybody under 25 even believe that this sort of copyright breach is illegal?
The motivation for cheating is all too obvious, but the motivation for not cheating is also obvious - ego. The vast majority of us want to believe we are honest. This means that any organisation that wants to prevent fraud must appeal to the ego.
The problem is that egos are slippery customers and adept at using moral self-justification to justify fraud. When customers in a cafe were asked to take a test, a waiter handed out money to each one, saying it was their $5 fee for taking part. But, in actual fact, he gave them each $9. When the waiter was polite, 45pc of participants returned the change. But when he stopped in the middle of a conversation with them to take a call on his mobile, only 14pc offered change.
The same forces are undoubtedly at play when it comes to tax and the blatant tax evasion that is such a feature of Irish life. We see it in our leaders, such as the late Charlie Haughey, down to the increasing number of professions who demand cash for their handiwork.
It is all too easy to persuade ourselves that everybody is at it.
A study, by criminologists at Keele University in England, found that nearly two-thirds of our nearest admitted to acts of dishonesty such as paying a builder in cash or buying clothes for a special occasion and returning them afterwards.
The worst offenders were the middle classes, with 70pc of those in the so-called A and B social brackets admitting to everyday fiddling, deceitfulness and fraud, compared with 53pc of those in the D and E brackets.
Behavioural economist Dan Ariely's book 'The Honest Truth About Dishonesty' has been sitting close to the top of many best-seller lists for months because Ariely nails the truth that we lie to everybody and most of all, we lie to ourselves to maintain our self-image as moral and honest.
Ariely is fascinating because he gives prescriptions on what works to counteract cheating and what does not work.
Interestingly, the prospect of public disclosure seems to hardly act as a deterrent.
The various tax cheats highlighted in the Irish Independent yesterday and today, knew that they faced the risk of exposure. After all, this newspaper and most other newspapers regularly publish lists of tax cheats but the businessmen, farmers and solicitors and other pillars of the middle class establishment continued to merrily defraud the country.
An Ariely test found participants who filled in a form resembling a standard US tax form cheated far less if they had to sign a disclaimer at the beginning saying that everything was true. Students who signed disclaimers at the end (which is the more common place for such disclaimers), cheated more.
"If people are regularly reminded of moral codes, they're far less likely to misbehave," says Ariely. "People want to be good. You just have to remind them."