The perpetrator of the biggest known Ponzi fraud (a bit like a pyramid scheme) Bernard Madoff, was sentenced to 150 years for crimes that were “extraordinarily evil” on 29 June. To mark the occasion, the Beeb asked the son of one of his victims (who had committed suicide as a result of losing everything) to investigate how it all happened. The style of the documentary was to shed light by way of describing it as a “classic long con”.
I was struck by how many solution sales pitches can come across as having attributes of The Long Con. This is clearly to be avoided. Whilst the logical extension of part of the inference (ie. never invest in anything) must be dismissed, the call to ensure forensic due diligence is overwhelming.
The ‘3 rules of the Long Con’ are apparently:
- If something sounds too good to be true, then it probably is
- Everyone wants something for nothing, your job is to give them nothing for something
- You can’t cheat an honest man
In this case, red flags that suggested the investment scheme was fatally flawed included:
- Consistent monthly returns, not in themselves spectacular, but the same regardless of boom or bust times
- Every time, he’d seemed to have bought near the bottom, and sold near the top
- It was an Affinity Crime; it began in and spread throughout one specific community to which Madoff belonged
- Being on-board was pitched as belonging to an Exclusive Club (you only gained acceptance if recommended by someone already ‘in’)
- People were vigorously persuaded to keep their money in when wanting to withdraw funds
- Meticulous attention to detail in the minutiae of sending the false account statements through each month
- People rarely looked beyond the stated rate-of-return and requests to speak to dealers were denied
- A whistle-blower (a decade earlier) was ignored, sidelined and perhaps even deliberately discredited
So for us solution sellers picking the bones out of this, maybe the first lesson is not to make something sound quite so “too good to be true”. For many successful sales people I know their natural exuberance renders this almost impossible!
I do like the compulsion this all propels to allow, even encourage proper due diligence as a mechanism to appreciably distance you from the charlatan’s charade. As touched on above, in b2b solution selling, is there a better way of achieving this than an evaluation use of the goods or service?