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Stepping up and standing out

30th Annual ACFE Global Fraud Conference

The ACFE has been hosting annual global fraud conferences for 30 years. Thousands of fraud examiners are so glad it has. Here's a recap of the latest — the largest so far.

When ACFE Founder and Chairman Dr. Joseph T. Wells, CFE, CPA, stepped up to the podium at the 30th Annual ACFE Global Fraud Conference in Austin in June, the ACFE’s accumulated history accompanied him. As he accepted his induction into the ACFE Hall of Fame, he received it as a representative of the thousands who, but for his foresight, probably never would’ve received fraud examination education and skills. 

“I know I can personally thank him for what it is I tell people I do for a living, as I’m sure many of you can as well,” said ACFE Board of Regents Chair Ryan C. Hubbs, CFE, in introducing Dr. Wells. “We are fraud fighters because of this person’s vision and hard work to grow an idea into a flourishing organization.”

Dr. Wells told the audience that “we get to where we are by doing all we can. Not in a straight line and not by finishing exactly where we started.

“If I had finished where I started, I’d be a CPA,” he said. “If that was the case, then God help us all because I was a terrible accountant. But I had a flair for fraud examination and that’s where I found my calling,” he said. “Not only was the work interesting and challenging but I was doing something to help make the world a better place. By your presence here today so are you.

“And if this country boy from Oklahoma can be named to the ACFE Hall of Fame, so can you achieve great things, just by doing all you can,” he said.

“Nearly everyone knows that I retired from active duty at the ACFE five years ago, at the age of 70,” Dr. Wells said. “But I’m still there nearly every day, sitting at the same desk in the same office in the same building I’ve occupied since 1984. They will probably have to carry me out of the place feet first. That’s okay. I am doing what I was meant to do, and I’m still doing all I can. Thank you all for this honor. It means the world to me.”

Can’t imagine doing anything else

“Stepping up and standing out,” the theme of the conference, can be “uncomfortable and confrontational but also exhilarating and rewarding,” said ACFE President and CEO Bruce Dorris, J.D., CFE, CPA, during his message at the conference.

“Where were you in your career ... when you first thought to yourself, ‘This is it. This is what I really want to do, and I can’t imagine doing anything else’?” Dorris asked attendees.

He described the professional journeys of two members. Dennis Dambruck, CFE, CPA, works as the head of finance for a bank in the small island nation of Curaçao. “When he was seven years old, his favorite TV shows were ‘The Six Million Dollar Man,’ ‘Kojak’ and ‘Columbo,’ ” Dorris said. “He said even at that early age, he was intrigued by those characters’ abilities to solve crimes. As time passed, he entered the financial world, and his interest for white-collar crime increased. He recalled that, ‘Digging to find out the truth, or how it was done, gets me going.’ ”

Dorris said that Sandrine Paquin-Lessard, CFE, CPA, CFF, was hooked in her last year of college when she attended an investigation class that lasted only one weekend, Dorris said. “She said, ‘I immediately knew that fighting fraud was what I wanted to do, since I found it more thrilling than general accounting and auditing, and I needed that excitement in my future job,’ ” Dorris said.

“She kept in contact with the teacher of the course who was a partner in a forensic accounting firm in Montreal. And as soon as she completed her education and internships, she contacted him and begged him for a job,” Dorris said. “After a year, he finally said yes. ‘It was the best decision of my life,’ Sandrine later said.

“I could regale you with countless stories like mine, Dennis’ and Sandrine’s,” Dorris said. “In fact, I know there are more than 85,000 of them around the world and over 3,400 unique stories gathered in this room right now. All with unique places, people and circumstances. But, as you may have already figured out, deciding to pursue this career is only the first step. What comes after is what truly sets you apart as an anti-fraud professional. It is then that you decide how to step up and stand out in your role.”

Conference unpacks fraud examination body of knowledge

Attendees had their pick of diverse anti-fraud topics from the Pre- and Post-Conference and the in-between Main Conference.

Three speakers led Pre-Conference sessions. Michael Schidlow, CFE, CAMS-Audit, head of financial crime risk training and emerging risk advisory, global internal audit, HSBC Bank, taught “Leveraging Anti-Money Laundering Controls to Detect and Report Corruption.”

Schidlow said that as financial institutions grapple with detecting and preventing money laundering, their efforts are resulting in a more unified concept of risk management that no longer views money laundering, bribery and corruption, sanction-evading and other financial crimes as separate issues to be dealt with individually but as an interconnected spectrum of fraud.

“The reality is [anti-money laundering] is going into a data-enabled marketplace, and if you can’t keep up with data, you’re going to have a hard time moving institutions or moving roles,” Schidlow said. (Read more from his session at Fraud Conference News.)

Bret Hood, CFE, director, 21st Century Learning & Consulting, led the session, “Becoming a Better Interviewer: Advanced Techniques to Detect Deception and Promote Honesty.” Regent Eric R. Feldman, CFE, CIG, CCEP-I, spoke on “Practical Issues in Ethics and Compliance: How to Evaluate Your Own Compliance Program Using the U.S. DOJ Guidance.”

During the Main Conference, attendees learned practical concepts at more than 100 educational sessions in 14 parallel tracks and other formats. Sessions ranged from “The Truth About the Dark Web Fraud Trade” and “Emerging Trends Affecting the Confession Interview” to “Leveraging Traditional Alternative Data in Investigations” and “Benchmarking Your Use of Anti-Fraud Technology.”

Attendees heard from keynoters Bill Browder, CEO of Hermitage Capital Management and global anti-corruption crusader; Bastian Obermayer, German investigative journalist and recipient of the Panama and Paradise Papers; Lisa Osofsky, director of the U.K. Serious Fraud Office; Theresa Payton, cybersecurity author and former White House CIO; and Tyler Shultz, Theranos whistleblower.

For the first time, conference participants could learn at four different Sunrise Sessions at 7 a.m. on Tuesday and Wednesday, plus attend the full Uniform CFE Exam Review course and sit for the Exam.

Attendees could glean information — at the Professional Development Center — from the new mini-workshops, professional work sessions, mentor and mentee matching and on-site professional strategists.

Four excellent speakers taught Post-Conference sessions. Leah D. Lane, CFE, and Tiffany Couch, CFE, CPA, CFF, team-taught the “Auditing/Investigating Fraud Seminar.”

Regent Bethmara Kessler, CFE, CIAS, taught “Fraud Risk Management” and Cary Moore, CFE, taught “Cyberfraud and Data Breaches.”

Bill Browder fights against corruption in Sergei Magnitsky’s name

For much of his life, Bill Browder’s goal was simple: to be the most successful capitalist in Eastern Europe. And he reached his goal there and in Russia. He made fortunes and lost them and then made them again. But that all changed in 2009 when his lawyer and friend, Sergei Magnitsky, died in prison under suspicious circumstances one month after submitting detailed documentation of a governmental scandal to Russian investigators. The year before, Magnitsky had exposed a complicated $230 million web of tax-refund fraud and graft involving Russian government officials. And for his courageous efforts, he lost his life.

“Sergei was murdered because he was my lawyer. If he hadn’t worked for me, he would still be alive today,” Browder told attendees. He said for the last nine years he’s devoted his life to seeking justice for Magnitsky.

Capitalist abroad

In the 1990s, Browder took advantage of Russia’s business privatization program after the Soviet breakup to make millions for an investment firm and then later for his own firm, Hermitage Capital Management. But then he lost $900 million in 1998 during the Russian stock market crash. He resolved to stay in Russia to recoup the money for his clients.

"I made a vow to his memory, his family and myself that I was going to put aside everything I was doing and devote all of my time, all of my resources and all of my energy to get justice for Sergei Magnitsky."

Browder said his recovery efforts were hindered by the owners of the companies in which he invested — Russian oligarchs. “They’re not nice people,” he said. “They had every instinct in their bodies to steal.” When he and his firm discovered that the oligarchs were siphoning the profits, Browder decided he’d investigate how they were doing it.

Browder then hired Magnitsky, who discovered how the oligarchs used fake contracts and court judgments to fraudulently obtain $230 million of Hermitage capital gain tax payments.

They reported the fraud to the Russian authorities. “Five weeks after Sergei testified [to the Russian version of the FBI], the same police officers he testified against came to his home at 8 in the morning on the 24th of November in 2008, arrested him, put him in pre-trial detention and tortured him to withdraw his testimony … and say he stole the $230 million."

Magnitsky refused to sign the false confession. After six months, he became ill with pancreatitis and gallstones. Prison workers withheld medical treatment, agents beat him and he died in prison on Nov. 16, 2009. “He was 37 years old and left a wife and two children,” Browder said.

“I made a vow to his memory, to his family and myself that I was going to put aside everything I was doing and devote all of my time, all of my resources and all of my energy to get justice for Sergei Magnitsky,” Browder said.

Browder has conducted a global campaign to impose visa bans and asset freezes on individual human rights abusers — particularly those who played a role in Magnitsky’s false arrest, torture and death. The 2012 U.S. Magnitsky Act was passed with overwhelming bipartisan support. Five additional countries have passed their own versions of the act. The 2016 U.S. Global Magnitsky Human Rights Accountability Act expanded the original Magnitsky Act.

“Bad guys do a lot of stuff … for money,” Browder said. “The idea that we can freeze their assets is a real consequence. They kill for money … and I believe some of them won’t kill because they don’t want to be put on a Magnitsky list.”

Cybersecurity expert: work with human behavior to avoid breaches

Organizations continue to operate under a cybercrime misconception about their customers, and it’s costing them a lot of money, said cybersecurity expert Theresa Payton. “The conventional wisdom [in cybercrime and fraud] is that ‘humans are the weakest link. … That’s why we have security problems.’ I want to change that conversation now.

“I used to feel that way when I was in the financial services industry,” she said. “I’d say, ‘I wish we could just train our customers on the little bit of what I know. My job would be safer and easier to do, and we’d all be happier.’ We’ve been talking this way for decades. We keep asking ourselves, ‘Why do people click on links? Why do people open attachments? … Why do people make these mistakes?’

“But we especially don’t design our security and fraud strategies around the human,” Payton said. “How many times have you said, ‘We have to be careful about how we put in place these fraud controls because we don’t want to cause too much customer friction. We have to charge off fraud like it’s a cost of doing business.’ The design and the way we think about it is wrong.”

Payton said that we have to accept that people will continue to operate in risky ways with technology. All technology is now designed to be “interoperable.” “Think about your smartphones. You can talk hands-free in the car … You can connect it to speakers,” she said. “Smart TVs. Smart thermostats. Smart doorbells. You’d be ticked if you spent that much money and discovered that it didn’t communicate with anything else. But that air of operability means that it’s open to be hacked.”

Organizations have to work with “connectivity technology” rather than hope that it doesn’t proliferate, she said.

"It's an arms race between you and them, and I'm betting on you to win. But the only way we win is we have to constantly change our tactics."

“The better you give of your ‘A game,’ the better fraudsters get,” Payton said. “They don’t say, ‘Wow, look at the great job fraud examiners are doing around the world to end fraud. This is getting so hard. I should just be a good person and bake pies for my neighbors.’ They don’t do that, do they? … We’re in a war! It’s an arms race between you and them, and I’m betting on you to win. But the only way we win is we have to constantly change our tactics,” she said.

“[Fighting cybercrime] is a team sport. From my perspective — working the cybersecurity industry — you guys are superheroes … trying to make sure fraudsters don’t get in the way of consumers, protecting your business, protecting the world. There’s a huge economic impact to what you do.”

Head of U.K. SFO: diverse teams have led to 3 life lessons

“Fabulous teammates” have taught Lisa Osofsky, the new director of the U.K.’s Serious Fraud Office, three top lessons over the years: 1) Make a clear plan. 2) Listen. 3) Find the truth.

“I have worked with teams over time — teams that evolve because the nature of fraud changed with the flattening of the globe,” Osofsky said. “I have learned from veteran investigators; I have learned from young and eager investigators new to the job. Let me … try to distill what those teams have taught me.”

Osofsky received the Dr. Donald R. Cressey Award for a lifetime of achievement in the detection and deterrence of fraud.

Make a clear plan

“Confusion is a friend of the fraudster,” Osofsky said. “Confusion, disorientation — they are oxygen for criminals.” She says that fraudsters’ trade is making lies appear to be true. So, investigators need to bring sunshine and truth via list-making and clear thinking when: analyzing a fraud, crafting an investigative plan and asking questions.

“There is a main event in every fraud,” she said. “Some flavor of lie. … The motive for the lie — almost always — is simple: It’s to get a victim to part with money.” Osofsky said investigators can keep their cases simple by listing the lies, who told them and where you’ll likely find them in documents and electronic material.


A fraud examination starts with a theory, an allegation, Osofsky said. “We need to be guided by facts not by theories. And to do that we must listen — truly listen — to the facts all along the way,” she said.

“We all know listening takes discipline. It takes self-awareness.” She cited how in the new book, “Working,” by historian Robert Caro, the longtime biographer of U.S. President Lyndon B. Johnson, he often writes “SU” — or “shut up” — by his interview questions. “Even a Pulitzer Prize winner tells himself to shut up and listen,” Osofsky said.

Find the truth

Osofsky said that sometimes we fall in love with our theories and those hypotheses can override the facts. “Confirmation bias is, of course, not just the preserve of investigators — it’s prevalent in every sphere of human behavior. But we need to guard against it.

“Our lodestar must be the truth,” she said. “At every stage and in crafting each investigative step, we must be guided by facts rather than theories or biases. Justice is done not only when we convict the guilty but when we exonerate the innocent.”

Osofsky said that we must be humble enough to know when our initial theory might well be dead wrong — in part or whole. “When we find inconvenient facts, it is our obligation to change our hypothesis.”

Just mission

“Not everyone can say that their job is to wake up in the morning and find the truth. We can,” Osofsky said.

“Working shoulder to shoulder with diverse, talented and dedicated teammates is a joy,” she said. And the subject matter we toll in — greed, envy, pride — is the stuff of drama.

“We are on a just mission, working on strong teams in an inherently interesting field. … We have an obligation to practice at the highest level. We have an obligation to our craft, and we have an unyielding obligation to truth.”

Visit FraudConferenceNews.com for more coverage of the 30th Annual ACFE Global Fraud Conference.

Mark your calendar for the 2020 Global Fraud Conference!

The 31st Annual ACFE Global Fraud Conference will be June 21-26, 2020, at the Hynes Convention Center in Boston, Massachusetts.

You’ve always wanted to attend a Global Fraud Conference, and now’s your chance to finally do it. Visit FraudConference.com to register.

See you in Boston in 2020!

Read more: How a fraudster's first stolen dollar turned into so much more

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