Seven Beaumont, California city officials were arrested and now face embezzlement charges in a $43 million scheme to defraud the city. There was more than one blindspot at work in this case! What happened?
Did seven city officials sit around a poker table one evening and decide to join forces to defraud the city? Were each of the seven men individually wondering how he could create a scheme to embezzle money then spontaneously they found each other? Did one mastermind create the scheme then start asking his peers if they would join him? Hmm. None of these scenarios are likely. Of course, we may never know how this scheme that started in the early 1990’s really began. You can count on this, every one of these men had blindspots!
Character flaw blindspots like greed and arrogance affected these seven men. Thinking errors like an entitlement mentality and immunity mindset were likely at play. Arrogant executives can easily fall prey to a feeling of entitlement. They feel that they have “arrived”. They are somehow now part of the elite class. The rules of the common folks no longer apply. Helping themselves to the cookie jar is merely a perk of power.
Blindspots can cause even good public officials to make bad decisions. In fact, your blindspots might cause you to make bad decisions and unwittingly become part of someone else’s crime. This is likely what happened with one or more of these co-conspirators. It is possible that when confronted with the reality that a colleague is profiting from his position, one might think, “why shouldn’t I also receive these perks?” It’s the classic case of the fraud triangle at work. When pressure, opportunity and rationalization meet, fraud can be birthed. Sometimes the only pressure in one’s life is that internal pressure from one’s own greed.
Now, what about all the others that were not indicted? Were there any other potential co-conspirators?
Imagine for a moment that you are an auditor for the city. You have been there for years and feel it is a great job, one from which you want to retire. One day you notice some internal control elements were inadequate. You bring it to your boss’ attention. He thanks you for doing your job and assures you that everything is okay. You accept his input. Afterall, he is a highly respected leader. But, you have this gnawing feeling that something is just not right. This goes on for months, maybe years. You notice other inadequate controls and continue to get reassured by several people that everything is okay. You continue to accept their assurance then rationalize that it’s ultimately not your responsibility. But, no matter what you try, you can’t shake the gut feeling. Now you think, “should I bring this to the attention of someone outside of my chain of command? What if I am wrong? I could get fired or passed over for that promotion. What if I am right? Certainly I would not be held responsible since I tried to say something, would I?” You decide to keep your mouth shut. You are not consciously thinking this, but fear of a job or promotion loss has just empowered you to act against your own ethics and values.
You have become a victim of the self-preservation bias. You have just experienced…The BlindSpot Zone!