DETERRENT?

Years ago I was involved with investigating insurance fraud.

One portion of my contribution consisted of an insurance agency Newsletter sent at the beginning of December to several of our agents. It was entitled,"Herbie wants to make a withdrawal".

The message was simple. It was a time of year when some of our policyholders clearly confused their whole life insurance policy with their other two policies - auto and homeowners.

The life policy had a cash withdrawal option. The other two policies did not.

Attempting to defeat fraud has many obstacles. One that stood out for me years ago was a tactic defense attorneys used successfully.

They convinced juries that any insurance department prevention unit - or insurance company subdivision - that included the word "fraud" in it's title forecasts a bad result.

The attorney argued that by retaining the word "Fraud" in it's title, those insurance people "are predisposed to suspect and and all citizens of being willing to commit a fraudulent act.

Therefore, they are guided accordingly by this bias with their subsequent investigations and false accusations of the average "Joe" -like his client (or like the jury members - one presumes)."

Yeah, it was shaky but the jury often bought it. There is a little larceny in most of us.One assumes there may have been one or more Herbies on the jury panels but,that's probably just "sour grapes."

The fact that "thee and me" would never have even contemplated making a fraudulent claim didn't matter much to the attorneys who were perpetrating the ruse and the insurance companies - once more -were perceived as the ultimate villain.

So, let me ask. What, if anything, would cause you to contemplate turning to the dark side?

There is an old joke about a prostitute and a prospective client.
The latter makes a ridiculously low offer for her services.

She responds by feigning indignation that he would think of her as a member of the oldest profession.

He then raises his previous offer of $100 for her services by asking her if she would join him for $10,000. Shocked as she may have been by this new offer, she somehow manages to agree.

He then handed her a $100 bill. She again responded with righteous indignation and demanded to know, "Hey, what do you think I am?"

He replied,"We both know what you are. We're just negotiating the price!"

So is insufficient money serve as a the deterrent to a "life of crime" or is it something even more basic?

The fraud prevention guys, who may or may not have been making real progress in their quest to defeat insurance fraud, came up with a new tact after sufficiently licking their wounds.

They started placing huge billboards along most well travelled roads and by-ways. Each contained a picture of a guy either behind bars or in handcuffs. The wording was simple, "Do you want your kids to see you like this?"

Some folks claim it was a great deterrent. Others were sure they knew the guy.

A woman advised me that she had two boys - one of whom hated receiving punishment for his misdeeds and therefore responded to "the good angel" on his shoulder.

The other son often weighed the punishment results versus the rewards of enjoying the fruits of his misdeeds, and decided accordingly based upon the two stimuli.

Unfortunately, that latter school of thought continues into adulthood - particularly when it comes to how we conduct our business.

It is sad -but true - that very little today will deter some folks from making horrible money driven corporate decisions -particularly if they do not fear the punishment, have great self-esteem and/or truly believe (like "the thinker" kid) the potential rewards exceed any punishment.

Fortunately, I also believe that for most of us, the thought that our son or daughter would see us on the next billboard is a boost in "doing the right thing " in our insurance fraud decision.

How can we transfer that billboard deterrent into something even more meaningful when the stakes are higher?

C'mon, let's face it, the paltry monetary rewards from insurance fraud most often pale in comparison to the financial rewards from a huge financial or safety related scam.

Here's part of the problem.

For some inexplicable reason, when it comes to the world of business - law makers and judicial experts have chosen not to use the deterrent of jail detention as a mean of combatting aberrant behavior.

Consider these examples.

"So far, not a single top executive of the mortgage companies, financial institutions or credit rating agencies that caused the 2008 meltdown, have been INDICTED, let alone SENT TO JAIL."

The same is true in four major mining disasters since 2001 in which 59 miners died."

The former CEO of Massey Energy,(the company who was held responsibile via a $209 million settlement for violations and the death of 29 men) has retired with a multimillion dollar pension and has recently surfaced as the owner of NEW mining company.

One reason for the lack of jail time for the executives whose companies committed safety violations as well as security fraud is that they are not "held to account" as their jobs allegedly keep them too far from the "action" ("They ain't 'doing the doing' argument".)

Whatever happened to the saying, "Not on my watch?"

Even the Supreme Court appears to have determined in the recent voter law arguments that "corporations are people - with the same protective rights"

I agree with the USA articles conclusion on the subject of deterrents:

"So, when irresponsible companies flout the law and create the conditions for disaster, the people involved should pay a price, preferably by going to prison."

I believe the conclusion should also apply to politicians no matter how liberal was the logic of "The Supremes" bunch they nominated.

If there were criminal prosecutions attached to the wrongful acts of people in charge there would be a reduction in the laissez-faire attitude of the miscreants.

Those comfortable attitudes would then be replaced by tight rearends as they sat behind the defense table or the witness stand
fearing the fate that they are facing.

Assume for a moment that many of those accused continue to maintain their musculature positions. Assume also they are convicted of their crimes - and the sentence pronounced by the judge mandates that it be carried out in the environment of the general male prison population.

Maybe we've finally found an answer in our quest for the ultimate "deterrent".

Forget those expensive billboards!