Keynote Speaker: Chris Mathers

By Dick Carozza, CFE, Editor in Chief, Fraud Magazine

“I spent my entire life in the company of criminals,” said Chris Mathers, the Tuesday morning General Session speaker. “Two things I learned: People do not steal your money to save it. And … people typically do not resort to criminality late in life. It’s not like taking up golf. It’s something you do from the very beginning.

“If the second statement is true …  how do you explain things like Enron? How do you explain when people went to good schools, came from good families and never had any criminal tendencies, all of a sudden start doing such dastardly things? I have a theory: the continuum of criminality. … You start with something really small. Something innocuous. … And then you embark on the continuum [until] you’re doing really bad things.”

Mathers is the founder of CHRIS MATHERS INC. His firm specializes in fraud, money laundering, terrorism and organized crime issues. He spent most of his adult life working undercover for the Royal Canadian Mounted Police (RCMP), the U.S. Drug Enforcement Administration (DEA) and the U.S. Customs Service.

He writes about his experiences posing as a gangster, a drug trafficker and a money launderer in his book, CRIME SCHOOL: Money Laundering.

“Popular culture has impacted everyone — young and old, particularly young people and changed their view of the world vis-a-vis their ethics and moral structure,” he said.

He gave the example that many prisons don’t allow inmates to smoke and use cell phones. However, many prisoners will try to convince correction staff to give them cigarettes and phones — obviously valuable currency.  “A guard will rationalize: ‘At least I’m not giving them guns or drugs,’ ” Mathers said. “But once you do that you’re embarked on the continuum. And now [the prisoner] has got you. He may threaten to expose the minor offense unless you commit a more serious offense. And so you move on down the continuum until you are doing really bad things. Maybe you are bringing drugs … and guns in.”

“What has changed? … This popular culture has given people a rather bizarre sense of entitlement. And that is what ultimately leads to criminal activity. A requirement for immediate gratification [and] the affectations of wealth. … People want to emulate what they see in popular culture.”

He subscribes to the “10-80-10 theory”: 10 percent of all people are really, really good, 10 percent are really, really bad, and the other 80 percent — well, it just depends on the situation. “And the stuff you’re working with, you’re dealing with the 80 percent. The hardcore bad guys aren’t going to come to work in your organization.”

In his day-to-day cases, most suspects are able to rationalize their illegal behavior. Some of the excuses: “The company owes me.” “I didn’t get a bonus.” “The boss is doing it.”

He cited some governments that require “facilitation payments” to perform basic importing activities. Clean companies are between a rock and a hard place; they will lose thousands of dollars because their shipments are held up because they won’t pay small bribes even if other firms are willing to pay “the cost of doing business,” he said. “I learned a long time ago that you have to set your ethical path.”

Mathers said it was a pleasure speaking to so many like-minded pros rather than banking and securities execs “who don’t want to hear about this because they’re too busy trying to make money. It’s nice to be in a place where you can feel the heat coming off a group of people who are going in the same direction.”

He closed off with the motto from the U.S. Air Force Academy. “It’s a good thing to hang up on the wall in your office: ‘We will not lie, cheat, or steal nor tolerate anyone among us who does.’ ”