James Randi and Fraud Prevention IX

Notice the flow of the sentences in the last posting.  Like with any cold reading, the person doing most of the talking is the cold reader and the person giving the information is the mark.

     Why is it important that the cold reader is barraging the mark with so many questions?

    We will explore tommorrow the difference between the stated goals of a financial professional and a fraudster.  It has to do with the type of information that is elicited by an actual financial professional vs. a fraudster.

Have a great and fraud free day.

http://www.tauskvega.com

----------->>>>>>>>>>>>>>>>>>gene tausk

James Randi and Fraud Prevention VIII

Cold reading example involving financial fraud:

Reader: "So, tell me about your kids' college investments."

Mark: "Well, they're not in college yet."

Reader: "So it is important to you to get your kids college investments in order?"

Mark:  "Yeah, of course.  We want to be able to make sure they get their degrees."

Reader: "So, how much money can we expect to save monthly?"

Mark:  "Well, we put aside $100 per month for each kid."

Reader: "So, you can only put aside $100 per month.  So, we need an investment with a little higher rate of return to make certain the kids can go where they want?"

To be continued.

Have a great and fraud-free day.

http://www.tauskvega.com

------------->>>>>>>>>>>>>>>>>gene tausk

James Randi and Fraud Prevention VII

Cold reading - the art of getting information from a person by getting the person to volunteer the information, usually by asking multiple, rapid-fire questions which elicit the information.

     What does this have to do with fraud?

     In the case of people who wish to get marks to invest in fraudulent or questionable investments, the fraudster needs to convince the mark that he can help the mark achieve his goals.  In this case, the goals are financial goals.  The fraudster wants to convince the mark that he can help the mark reach his financial goals, in other words, to make the mark wealthy though giving the money to the fraudster.

     No sane or rational person would willingly give a person money if the investment was a Ponzi scheme or a Pyramid scheme.  Who wants to hear that "yes, you will get your investment back and interest by getting other people to invest in my scheme."  So, the fraudster has to convince the mark that it is NOT a Ponzi or Pyramid scheme.

   How to do this - cold reading is one method.

As always, have a great and fraud-free day.

http://www.tauskvega.com

--------------->>>>>>>>>>>>>>>gene tausk

James Randi and Fraud Prevention VI

OK, so the cold reader we now know uses a barrage of questions, far more than the "20 questions" game we played as kids to elicit a response from the mark.  Eventually, these questions will start to hit home and the cold reader will be able to "hone in" on the responses, even the unconcious responses, of the mark.  The mark, even unknowingly, will be giving information to the cold reader.

     In scams such as "talking to the dead," the cold reader will be able to answer seemingly unknown or unknowable answers about the person who has passed on.  The deceased's name, hobbies, loves, interests, likes, dislikes, phobias, favorites....all is revealed to the cold reader with enough time.  And, since the cold reader does not really need a great deal of time to get the necessary information, it seems that the cold reader is indeed getting information from a mysterious source.

     Add all of these together, with a gullible mark, and the cold reader can make quite an impression.

     Note when I say that the mark is gullible, by the way, I am not suggesting that the mark is stupid.  What usually happens is that the mark is at an emotionally vulnerable point, such as after the death of a loved one, and the mark is being preyed upon by a professional who knows how to read cues that other people might miss, and with this combination, the cold reader is getting information faster than he would be with a person who might be thinking critically.

     Cold reading techniques are the hallmark of fraudsters as well.  Think about it - unless you believe in "psychic" powers (and although it is not the point of this blog to debunk "psychics," it is clear from my use of James Randi what I think of such "powers"), a cold reader is passing himself off as someone who has special skills that he does not have in reality.  So, when used improperly, cold reading can in and of itself be fraud.

     In our next segment, we will explore the use of cold reading techniques for financial fraud.

As always, have a great and fraud-free day.

http://www.tauskvega.com

----------------->>>>>>>>>>>>>>>>>>gene tausk

James Randi and Fraud Prevention V

OK - we've reviewed the videos and articles of "cold reading."  What is the common element to cold reading?

     As we saw, cold readers basically ask the mark a barrage of questions.  Cold readers take advantage of human psychology in that after being battered with so many questions, the cold reader is bound to score a "hit" and the mark will remember the one hit and forget the multiple misses.  Look at the video again of cold readers - they will ask the barrage of questions, far more than in a normal conversation.

     This is essentially a variant of "twenty questions," a child's game.  The one child will think of something and the other child will have up to twenty questions to guess what is the object.

     As it turns out, the game of twenty questions has a great deal in common with fraud schemes.

As always, have a great and fraud free day.

http://www.tauskvega.com

------------->>>>>>>>>>>>>gene

James Randi and Fraud Prevention IV

OK - here is one more article on cold reading before we expand our discussion this week.

Please read.

http://www.randi.org/library/coldreading/

Have a great and fraud-free day.

http://www.tauskvega.com

-------------->>>>>>>>>gene tausk

James Randi and Fraud Prevention III

So - what does talking to the dead have to do with fraud?

     As we saw in the previous post, "talking to the dead" is really nothing more than the con artist (psychic) asking a barrage of questions to get information from the mark.  This is known as a "cold reading."

     Here is a definition of cold reading: http://en.wikipedia.org/wiki/Cold_reading

We will discuss this more.  In the meantime, please read the article.


Have a great and fraud-free day.

http://www.tauskvega.com

-------------->>>>>>>>>>>>>>gene tausk