The Fraud Examiner

Ethical Decision-Making Tools: Two Models for Fraud Examiners
 

By Laura Hymes, CFE

February 2015

 

Fraud examiners inevitably face difficult ethical decisions in the course of their work, so they should have tools and resources to support and guide them in these decisions. One of the most helpful tools that fraud examiners have at their disposal is an ethical model — a framework that can be applied to a specific situation to help an individual decide how to act. Here, we’ll review two ethical models that fraud examiners can use when faced with tough decisions and some hypothetical questions they can ask to reach conclusions.

 

Deontological Versus Teleological Ethics

Don’t be intimidated by the philosophical words; these are simply two categories that academics use to break down ethical models. Deontological decisions are based on a duty to do or not do something (D for deontological and duty). The outcomes of actions are irrelevant in this decision-making model. Teleological decisions are based on the turnout (the result) of an action or inaction (T for teleological and turnout).

 

Both ethical categories have a well-known principle associated with them. Deontological ethics is associated with the imperative principle, and teleological ethics is associated with the utilitarian principle.

 

Imperative Principle

The imperative principle is the most well-known model based on deontological ethics. It states that people must make their decisions based on universal rules by which everyone must abide. For example, the generally accepted rule against killing is a dictate that members of society agree to follow. Expanding this rule to a deontological scope, it does not matter what the result of an act of killing would be (e.g., self-defense); the rule says not to kill, so you can’t kill. Theoretically this principle works because everyone is obligated to abide by the same rules. However, as we all know, it doesn’t work that way in real life, and as a society we have made exceptions to some rules (e.g., killing in self-defense).

 

Even though we make exceptions to the imperative principle, it can still serve as a useful decision-making tool. If examiners have a set of rules (such as the ACFE’s Code of Professional Ethics) to guide their actions, they should review it to see if their specific ethical dilemma is addressed. If there is a strict rule addressing the issue, the examiner’s problem is solved because he or she must simply follow the rule. Unfortunately, it’s rarely that clear-cut.



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