PROFESSIONAL ETHICSPresented by: Chuck Cochran, CFE

Sponsored by: San Diego Chapter-ACFE

About Your Presenter; That’s Me!• Licensed Private Investigator since 1982• Certified Fraud Examiner since 1993• Researching, studying and instructing in ethics since 1992• Office Phone: 619-691-6379• E-mail: crcochran@cochranpi.com

Don’t Worry, I Have a Plan• Understanding the characteristics of a profession and a

professional• Examine the need for professional ethics• Examine the General and the Specific models of

professional ethical codes• Clarify the elements required for a professional ethical

code• The Quest: Seeking the perfect code of professional

ethics

LET’S START AT THE BEGINNINGUnderstanding the Characteristics of Professions and Professionals

Tradition!• Traditionally, there are only three recognized professions• Law, medicine, and the clergy• These are the only professions with a legally recognized

privileged relationship with clients, patients, and penitents• This concept of privilege sets attorneys, doctors, and

clergy apart from other “professions”• What about the rest of us?

I’m a Professional and You’re Not!• A number of occupations desire recognition as a

profession • Designation as a profession denotes a certain amount of

trust and prestige• There is a desire to limit the number of professions to

maintain exclusivity and prestige• How do we separate professions from vocations?

Characteristics of a Profession• Has a recognized body of specialized knowledge• Requires members to demonstrate mastery of that body

of knowledge• Provides an important service to society• Services are primarily “white collar” as opposed to “blue

collar”• Bound by a distinctive code of conduct; i.e. ethics

Wait! Something’s Missing• Continuing professional education (CPE) traditionally has

not been a characteristic of a profession• The introduction of a CPE requirement for professionals

created some resistance• More and more professions are requiring CPE credits for

their members

I’m a Professional, Yes I am!• You might be a professional IF• You have mastered the knowledge of your profession• You have demonstrated that mastery in the appropriate

manner• You maintain that mastery through continuing professional

education• You abide by your professions code of ethics

TRUST ME, I’M A PROFESSIONALThe Need for Professional Ethics

Reasons for Professional Ethics• Unethical professional conduct can cause more harm to

society than most other occupations• Communicates the ethical viewpoint of the profession to

society• Promotes the values of the profession over personal,

societal, or institutional values• Don’t forget, society expects a profession to have a code

of ethics

What do We Get Out of It?• Provides guidance on ethical questions that arise during

the course of professional activity• Defines relationships with clients, colleagues, and the

public• Provides you with a degree of credibility as a member of

the profession• Offers you a defensible position for your decisions

THAT WHICH GOVERNS LEAST, GOVERNS BESTThe General Model for Professional Ethics

Short, Sweet and to the Point?• The general model provides broad ethical guidelines for

the professional and is easy to write • This broad approach makes it possible to cover a wide

range of situations• This brevity limits guidance for proper action in specific

situations• Additional guidelines may be required to clarify what

constitutes an ethical violation

Examples of a General Model• Association of Certified Fraud Examiners - Code of Ethics• California Association of Licensed Investigators - Code of

Ethics• American Academy of Forensic Sciences - Code of Ethics

and Conduct

THE DEVIL IS IN THE DETAILSThe Specific Model for Professional Ethics

Chapter and Verse• The specific model is characterized by detailed language

that attempts to cover ethical decisions for a variety of circumstances

• However, unusual circumstances may present difficulties in the application of the code.

• A possible solution is to provide introductory paragraphs to the code written in more general language

Writing Chapter and Verse• One of the biggest problems with the specific model is the

long and difficult writing process• Preparation of a specific code requires a clear

understanding of the duties and responsibilities of the profession

• A wide range of professional experience is vital in the preparation of a specific code

• Finally, specific codes are difficult to revise

Examples of Specific Models• American Bar Association’s Model Rules for Professional

Conduct • American Institute of Certified Public Accountants’ Code

of Professional Conduct• Code of Professional Conduct, Standards and Ethics for

the Investigative Profession, by Kitty Hailey

SOME ASSEMBLY REQUIREDElements of a Professional Code of Ethics

Putting Your Code Together• A code of ethics must derive from mutual agreement• A code of ethics must be written• A code of ethics must have some form of dispute

resolution

Let’s All Agree to be Good• Why mutual agreement?• No one can be forced to abide by a code of ethics• Adherence to an ethical code maybe required to maintain

employment, professional standing, or group membership• Ethical codes receive authority and acceptance by

consent of those governed

Put it in Writing• To be effective, an ethical code must be written• Unwritten codes lead to ambiguity, confusion and possible

abuse• A written code clarifies and defines the behavior expected

of a professional• A written code provides transparency and increases

confidence in the profession

Resolving Disputes• A critical part of a code of ethics is a process for resolving

allegations of ethical violations• There must be a clear procedure for receiving and

investigating all allegations• A process for a hearing that allows the participation of all

interested parties is essential• A review of the investigation and the hearing is needed to

determine the validity of the complaint• An appeals process must be available if a violation did

occur

Actions Have Consequences• If an ethical violation has been found, sanctions are

necessary to maintain the validity of the code of ethics• The code of ethics must clearly state what sanctions may

be imposed and under what circumstances• Sanctions may include reprimand, suspension, or

expulsion• Serious violations may be referred to legal authorities for

prosecution or other legal sanctions

Public or Private?• The question about whether to make any part of the

dispute process public is a difficult one• A lack of openness may damage public confidence in the

profession• Going public may inhibit colleagues from making

complaints for fear of repercussions from other colleagues• There may be a desire not to embarrass a colleague over

a trivial, but not insignificant, violation

Go Public, Go to Court?• Going public with a dispute may involve the organization

in a lawsuit• Generally, courts are reluctant to interfere with matters of

internal discipline• However, the possibility of legal action by a professional

colleague facing disciplinary actions can’t be ignored• An important part of a legal defense is a fair and objective

process to resolve all allegations

Final Note on Privacy

•Three can keep a secret, if two of them are dead. Benjamin Franklin

THE SHINING CITY ON A HILLThe Quest for a Perfect Code of Professional Ethics

Ain’t Going to Happen• There will never be a “perfect” code of professional ethics• Regardless of the care, effort, and thought put into the

development of a professional code, there will be critics• Some criticism will be thoughtful and constructive and

should be given serious consideration• Other criticism will appear to have no purpose other than

to belittle the effort and effectiveness of the code

Give It the Old College Try!• Focus on creating a “more perfect” code of ethics• Regardless of the model used for the code, the language

should be clear and concise• Authors of the code should have a wide range of

experience in the profession• Should be periodic reviews and revisions of the code for

clarifications and adaption to changing technology

A Final Thought

Never, never, never give up.Winston Churchill