In the realm of forensic accounting and fraud examination, few skills are more critical—and more nuanced—than the art of conducting effective interviews and interrogations. These techniques are not just about gathering information; they’re about eliciting the truth in a legal, ethical, and psychologically informed manner.
Whether you’re an internal auditor, forensic accountant, compliance officer, or fraud investigator, mastering interviewing and interrogation techniques in fraud investigations is essential for uncovering facts, detecting deception, and resolving cases efficiently.
In this in-depth guide, we will explore:
- The difference between interviews and interrogations
- Key stages of a fraud investigation interview
- Verbal and non-verbal cues of deception
- Legal and ethical considerations
- Practical interviewing strategies and frameworks
- Common mistakes and how to avoid them
🎯 Interviewing vs. Interrogation: Understanding the Difference
Though often used interchangeably, interviewing and interrogation are fundamentally different processes in fraud investigations.
| Aspect | Interviewing | Interrogation |
|---|---|---|
| Objective | Information gathering | Elicit a confession or admission |
| Tone | Non-accusatory, neutral | Accusatory, confrontational (when justified) |
| Timing | Early in the investigation | After evidence points to culpability |
| Participants | Typically witnesses or persons of interest | Prime suspects |
| Approach | Open-ended questions, rapport-building | Structured questioning, psychological strategies |
Effective interviewers know when and how to pivot from a conversational tone to a more direct strategy as the situation evolves.
🧭 The Phases of a Fraud Investigation Interview
1. Preparation
Preparation is the cornerstone of successful interviews. Before speaking to anyone:
- Review background documents and prior evidence
- Identify inconsistencies or red flags
- Understand the interviewee’s role, access level, and potential motives
Prepare a list of open-ended, non-leading questions to guide the conversation, but remain flexible based on the flow of responses.
2. Establishing Rapport
Building trust is crucial, especially with cooperative witnesses. Use the first few minutes to:
- Explain the purpose of the interview
- Create a safe, non-threatening environment
- Use mirroring and active listening to make the subject feel heard
Even with suspects, rapport helps lower psychological defenses.
3. Information Gathering
This is the core of the interview, where the interviewer explores:
- What the interviewee knows
- Timelines, transactions, or behaviors relevant to the case
- Clarifications on documents, roles, or observations
Techniques:
- Start with general questions, move to specifics
- Use the PEACE model (explained below)
- Ask the subject to repeat timelines in reverse to spot inconsistencies
4. Analysis and Detection of Deception
Skilled interviewers look for:
- Verbal indicators (evasiveness, qualifiers like “to be honest…”)
- Non-verbal cues (eye movement, posture changes, excessive sweating)
- Logical inconsistencies or contradictions with known facts
Important: No single cue proves deception. Look for clusters or patterns over time.
5. Confrontation (if applicable)
If the subject is implicated:
- Present evidence calmly and methodically
- Avoid aggression or emotional appeals
- Allow silence—many subjects fill it with admissions
6. Closing the Interview
Regardless of outcome:
- Summarize key points and confirm understanding
- Document the conversation in detail
- Ask if the interviewee has anything to add
🧠 Psychological Techniques Used in Interviews
Fraud investigations often rely on behavioral psychology to increase the effectiveness of interviews. Here are some common and ethical approaches:
🧩 The PEACE Model (Widely Used in the UK and Canada)
- Planning and Preparation
- Engage and Explain
- Account (free narrative, followed by probing questions)
- Closure
- Evaluation
The PEACE model encourages transparency, reduces coercion, and is legally sound—ideal for both cooperative and reluctant interviewees.
🧠 The Cognitive Interview Technique
Best for witnesses, this method helps enhance recall by:
- Asking the person to recount events in different orders
- Recreating the physical or emotional context
- Focusing on all senses (what they saw, heard, smelled)
🎭 The Reid Technique (Controversial)
This structured 9-step method is more confrontational and often used in law enforcement interrogations. However, due to concerns over false confessions, many forensic accountants avoid it, especially in corporate settings.
📉 Common Verbal and Non-Verbal Signs of Deception
While no single sign confirms dishonesty, clusters of behaviors can indicate discomfort or evasion.
Verbal Cues:
- Vague or overly general answers
- Delay in responding
- Repeating the question before answering
- Deflection (“Why would I do that?”)
- Avoiding direct denial
Non-Verbal Cues:
- Avoiding eye contact
- Fidgeting, excessive blinking
- Sudden changes in posture or tone
- Incongruent facial expressions
- Covering the mouth or face while speaking
Important: Consider baseline behaviors. A nervous person isn’t necessarily guilty—they may just be intimidated by the setting.
🧾 Legal and Ethical Considerations
In corporate fraud investigations, staying within ethical and legal boundaries is essential.
🚨 Legal Points to Consider:
- Miranda rights only apply to government-led criminal investigations
- Company policies and employee handbooks dictate what’s permissible
- Employees may be required to cooperate as a condition of employment
- Obtain consent for recorded interviews (check jurisdictional laws)
✅ Ethical Best Practices:
- Never use threats or promises
- Avoid deception about evidence (e.g., fabricating proof)
- Respect privacy and dignity
- Document everything thoroughly and objectively
🧠 Practical Tips for Effective Fraud Interviews
- Use silence strategically – people often fill it with valuable information
- Ask follow-ups that clarify contradictions without accusing
- Take notes discreetly or record (with permission) for accuracy
- Interview witnesses before suspects to gather unbiased insights
- Don’t interview multiple people in the same room—individual recollections vary
- Have a second interviewer or observer when possible to reduce bias
🏢 Real-World Example: Internal Expense Fraud Investigation
Background:
A multinational company noticed an unusual spike in travel expenses from one regional office. An internal audit flagged inconsistencies in receipts and expense patterns.
Investigation:
The auditor conducted structured interviews with employees:
- The assistant who booked travel was cooperative and detailed
- The regional manager, when interviewed, became evasive and repeatedly stated “I can’t recall” when confronted with conflicting receipts
- When shown a specific document, the manager paused for several seconds, then gave an inaccurate explanation
Outcome:
With proper documentation of the inconsistencies and body language, along with matching financial evidence, the manager was placed under formal investigation and eventually admitted to inflating expenses over 18 months.
🔐 The Importance of Documentation
All interviews and interrogations must be:
- Documented in detail (who, what, when, where, why, how)
- Typed up immediately or transcribed from a recording
- Summarized objectively—avoid conclusions or assumptions
These records may be used in:
- Disciplinary action
- Civil or criminal litigation
- Insurance claims
- Regulatory compliance reviews
✅ Summary: Mastering the Human Element of Fraud Investigations
Fraud investigation is as much about understanding people as it is about analyzing numbers. A successful interviewer knows how to:
- Build rapport
- Ask the right questions
- Read behavioral cues
- Maintain legal and ethical boundaries
- Document everything for accountability
Whether you’re working on a complex financial fraud case or a routine internal audit, strong interviewing and interrogation skills are critical tools in the forensic accountant’s toolkit.
