Saturday, November 3, 2012

5 Secrets of the Top Bullshitters (and scammers)

English: Bernard Madoff's mugshot
English: Bernard Madoff's mugshot (Photo credit: Wikipedia)
Psychology Today came up with 5 secrets of top bullshitters, by sampling the techniques of Bernie Madoff, Alan Stanford, and Donald Trump. Here's my summary and some counter-tactics:

1. Always remember - people are afraid to challenge you.

a) People are generally non-confrontational, and it takes a special kind of people who challenge a better known figure. Internet has helped this somewhat by giving people relatively anonymous voice, but there are "reputation" managers out there trying to squash dissent, and there's way more people who support the better known figure and shout down any critics. b) people are taught to value "confidence", and if you act with bravado and smirk and ignore challenges, many will mistake that for confidence.  c) Many were taught to go by alleged reputation instead of logic. Bull**** is still bull**** no matter who spoke it, but many assume that people with alleged reputation will not speak bull****.  "Fake it till you make it" is an often uttered mantra.

Why it's bull****: The people who post negative info have something to say and they believe it enough and want it to be heard, and therefore, you should at least listen to it. In other words, listen to the dissenters, then check why they say things they do, instead of dismissing their POV by reflex.  You may learn something. You should be able to distinguish the fluff "buy my stuff instead" from the "this is a scam, and these are the reasons".

Counter-tactic: when you detect a sea of support for some thing you are thinking of joining, it is more important to seek out the NEGATIVE opinions and see if they are making sense. If they are talking about aspects that were NOT covered, then it's clear that the positive stuff you read is marketing material, not a review or the "whole truth".

2. Point to your legitimate successes or bona fides 

Bernie Madoff often points to his LONG history as a successful stock broker, and Paul Burks of ZeekRewards Ponzi pointed to his business having been around for like 15 years (though there's a lot of fudging of the history).

Corollary: if you don't have any legitimate successes, make some up or exaggerate

If they don't have success, they point to anything thing ELSE that may suggest legitimacy, like Internet traffic stats (such as Alexa rankings), having hired services of famous attorneys and/or consultants, and so on. This is known as "attribute transfer", mention something ELSE, and try to transfer their attribute to your thing.

Another way is to misrepresent something to be bigger than it is, by encouraging a false image. For example, "Congressional Medal of Distinction" is often found on resumes, even though it's a "donation award", i.e. you get it by giving money to the Republicans, though it's often represented as "successful business leadership".

Yet another is completely misinterpret an existing law to mean something it does not. Scammers are quite fond of this tactic. One exclaimed that cable deregulation (which happened 20 years ago) to mean all cable content can be freely pirated. Another claimed that a California bill that removed the restriction of eCommerce to be exclusively conducted by US Dollars to somehow legalized the creation of their bogus cybercurrency.

Why: Andy "Ad Surf Daily ponzi" Bowdoin was known to have claimed he worked with Napoleon Hill and Andrew Carnegie when he merely sold their books). He also claimed the Congressional Medal of Distinction and claimed to have been given the Medal by President Bush himself (it's mailed to recipient).  Most "successes" are merely bandwagon fallacy and/or red herrings (such as claiming "top Alexa ranking means this thing is legit!") and can be manipulated (one can buy a botnet for a few days to drive up Alexa stats).

Counter-tactic: check if the successes are really successes (some scammers are known to pad their resumes.

3. Act arrogant - keep it up.

Any appearance of weakness will be pounded, thus you must always act like you're winning, even when you're losing. Donald Trump always act like an arrogant bast*** and it's very intimidating to most people, which goes back to #1. Heck, even when the government is taking you down, hire some proxies and continue to attack the critics (and the government).  The most famous of these examples would be "Baghdad Bob", who was saying things like "Our glorious Iraqi army are annihilating the infidel invaders", even as American tanks are attacking the city during the Second Iraq War. Obviously, it's delusion, but Baghdad Bob was just doing his job. Scammers HAVE to do it. It's swim or sink.

Why: There's a lot of those "positive wishful thinking" books that advocate "fake it till you make it". That's just lying to oneself... and everybody else. Attitude does not dictate reality, or legality. Confident liar will convince even experts.

Counter-tactic: arrogance / confidence may merely be bravado, not real bravery / leadership. Ignore displays of confidence. Analyze only the available facts, not the presentation itself.

4. Claim esoteric knowledge or techniques.

Bernard Madoff was famous for once claiming that his investment technique was too complicated for normal people to understand. Many Ponzi schemes claim some sort of secret formula or process. Then they claim it's a business secret that cannot be shared. If people doubt the secret, they will be attacked for having doubt (#3) and past "successes" will be paraded (#2). Linking it to something beyond questioning, such as religion and "American Dream" may also keep it from being questioned further.

The Achieve Society ponzi scheme, for example, claimed "proprietary triple algorithm" which they later admitted to SEC that it's totally bogus. It's amazing how people just take their word for it, years later.

Why: Claiming "secret" is a good way to give you illusion of power and knowledge, but actually also holds you in their power, by making you a part of their group / conspiracy. And if the explanation is made up, then you are living a lie, BECAUSE you choose to accept "crap" explanation, i.e. "it's a secret" as sufficient.

Counter-tactic: NEVER assume that the given explanation is valid. If you don't understand it, find someone who does (and make sure they really do, or you end up with a "fake" expert and will get bad advice). If they refuse to explain it to your satisfaction, but choose to distract you instead, leave.

5. Always delay the day of reckoning.

Kick out the doubters and people asking questions, act arrogant as in they don't know anything, they can't be proper business people (#3), claim they lack your esoteric knowledge (#4), point back to past successes (#2), and keep intimidating them so they don't confront  (#1). If necessary, make partial release of info, claiming time needed to reform, and keep things going and buy time while.

Why: If you stay and take the crap, you must be ENJOYING crap. And who does?

Counter-tactic:  keep your own cumulative "crap meter". If you are being given "crap" for explanation, and you got too much of it, leave, instead of staying around and get more "crap".

All in all, if you see more than one of these tactics being used on you, it's time to leave. 

Read the original version here.
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