Due Diligence

Feds Start Behavioral Profiling To Catch White-Collar Criminals

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michael-douglas-on-gordon-gekkoTo show that they are not soft on white-collar crime, the Feds have begun using the kinds of behavioral profiling techniques that tend to be reserved for violent criminals like serial killers, says Matthew Goldstein over at Reuters:
"For about two years now, agents with the Federal Bureau of Investigation's Behavioral Analysis Unit have been consulting with their colleagues in New York who specialize in securities fraud detective work. The BAU agents are going over the case files put together by the FBI for Madoff and other convicted scammers like Bayou Group's Samuel Israel, whose $400 million hedge fund turned out to be Ponzi scheme, and former Democratic fundraiser Hassan Nemazee, who stole nearly $300 million from Citigroup and two other big banks."

The drawbacks to this approach are that most white-collar crooks do not have prior criminal records and often have the same characteristics that can make some business people very successful: type A personalities, charisma, great ambition. But the agents in the FBI's behavioral group are hoping they can pinpoint enough traits shared by criminals like Bernie Madoff, Michael Milken and Alan Stanford to draw up a profile that will be useful to them in ferreting out future ponzi schemers and insider trading bigs.

(For the full story, check out Reuters)

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