Trust and deception in multi-agent trading systems: a logical viewpoint

Trust and deception have been of concern to researchers since the earliest research into multi-agent trading systems (MATS). In an open trading environment, trust can be established by external mechanisms e.g. using secret keys or digital signatures or by internal mechanisms e.g. learning and reasoning from experience. However, in a MATS, where distrust exists among the agents, and deception might be used between agents, how to recognize and remove fraud and deception in MATS becomes a significant issue in order to maintain a trustworthy MATS environment. This paper will propose an architecture for a multi-agent trading system (MATS) and explore how fraud and deception changes the trust required in a multi-agent trading system/environment. This paper will also illustrate several forms of logical reasoning that involve trust and deception in a MATS. The research is of significance in deception recognition and trust sustainability in e-business and e-commerce

Enhancing the auditor\u27s fraud detection ability: An interdisciplinary approach

A contemporary issue of concern to both external auditors and financial statement users is fraud-detection by auditors. The ability of auditors to detect material irregularities, including fraud, should be enhanced to enable them to apply reasonable skill and care in carrying out the audit. Such proficiency in fraud detection is needed if the profession is to avoid costly litigation, ever-increasing indemnity insurance and erosion of the profession\u27s credibility. The thesis maintains that such enhancement can be achieved if auditors both utilise knowledge about the aetiology of fraud in psychology, sociology and criminology as well as by synthesising a broad range of approaches to fraud detection. The multidisciplinary discussion of the aetiology of fraud enabled the development of a three-component model. The model\u27s three components are: rationalisations (R), opportunity (0) and a crime-prone motivated person (P), hence the acronym ROP. Next, a close examination of relevant auditing guidelines and a number of fraud detection models that have been proposed were used to develop an eclectic fraud detection model (with the ROP model as one of its components). The applicability of the ROP model was determined in a study of 50 major fraud cases investigated and prosecuted by the Major Fraud Group (MFG) of the Victoria police. The study identified a number of inter-relationships between offence, offender and victim characteristics. The findings obtained also confirmed the applicability of the model in the field and yielded a two-level criminal profile of serious fraud offenders which includes a new taxonomy of such offenders. The taxonomy consists of twelve specific typologies. In addition, the MFG study findings cast doubt (I) on Gottfredson and Hirschi\u27s (1990) assertion in their General Theory of Crime that white-collar offenders are not significantly different from common offenders and (2) on a basic premise of Loebbecke et al.\u27s (1989) fraud risk-assessment model that all three components of their model need to be present for fraud to occur. The experience of auditors with detecting six different types of material irregularities, including management fraud, employ fraud and error, was investigated in a postal survey of 108 auditors. The findings provide support for the applicability of the eclectic fraud detection model. The survey also found that: it is rare for even experienced auditors to encounter material irregularities; that different types of irregularity (e.g., management fraud) occur more frequently in some industries (manufacturing and construction) than in others; the irregularity is likely to take one form (e.g., window dressing and misappropriation of funds) rather than another; and management review and tests of controls are more likely to alert an auditor to the existence of management fraud. In support of earlier research findings, data analysis revealed that the lack of an effective internal control system and the absence of a code of corporate conduct are statistically significant correlates of an irregularity having a material impact on the financial accounts of a company. In contrast to claims by Loebbecke et al. (1989), the survey findings show that fraud risk-assessment utilising red flags alone is not effective and the presence of only two (and not all three) of their model\u27s components need to be present for management fraud to occur. Both the ROP model and the eclectic fraud detection model were further refined in the light of the findings from the two empirical studies. Without ignoring limitations of the two surveys, the work reported in the present thesis sheds new light on the aetiology of fraud, shows that neither audit experience nor red flags alone is sufficient to improve auditors\u27 fraud detection performance and provide another dimension to fraud risk- assessment. The new knowledge should be added to the auditor\u27s armoury to enhance the audit effectiveness and efficiency and to reduce the fraud detection component of the expectation gap

Explaining and trusting expert evidence: What is a ‘sufficiently reliable scientific basis’?

Through a series of judicial decisions and Practice Directions, the English courts have developed a rule that expert evidence must have ‘a sufficiently reliable scientific basis to be admitted’. There is a dearth of case-law as to what degree of reliability is ‘sufficient’. This article argues that the test should be interpreted as analogous to one developed in the law of hearsay: expert evidence (scientific or otherwise) must be ‘potentially safely reliable’ in the context of the evidence as a whole. The implications of this test will vary according to the relationship between the expert evidence and the other evidence in the case. The article identifies three main patterns into which this relationship falls. Whether the jury relies upon the evidence will depend upon what they regard as the best explanation of the evidence and how far they trust the expert. Whether their reliance is safe (as a basis for conviction) depends on whether they could rationally rule out explanations consistent with innocence, and whether the degree to which they take the expert’s evidence on trust is consistent with prosecution’s burden of proving the essential elements of its case, including the reliability of any scientific techniques on which it relies

Implications of the fraud triangle for external auditors

In recent years the role of the external auditors in relation to the detection of fraud has come under scrutiny. In an effort to give guidance, the auditing standard setters have employed the “fraud triangle” (which originated from Cressey’s work [1950]) setting out pressures, opportunity and rationalisation behind frauds. Traditionally, it could be said that external auditors have focused on opportunity (i.e. through the assessment of internal controls). Since the mid - 1990s auditors have looked at high level risks and so have been considering pressures on management. However, the third aspect of the fraud triangle, namely rationalisation, seems to have been ignored. The point is that two people may experience the same pressures and have the same opportunity to commit a fraud, but depending on how they rationalise the situation, one may commit it whilst the other may not. The under appreciation of this aspect of the fraud triangle may mean there is a weakness in the external auditors’ approach

Genderfucking Non-Disclosure: Sexual Fraud, Transgender Bodies, and Messy Identities

If I don\u27t tell you that I was assigned male at birth, as a transgender person, can I go to jail for sexual assault by fraud? In some jurisdictionslike England or Israel, the answer is: yes. Previous arguments against this criminalisation have focused on the realness of trans people\u27s genders: since trans men are men and trans women are women, it is not misleading for them to present as they do. Highlighting the limitationsofthis position, which doesn\u27t fully account for the messiness ofgendered experiences, the author puts forward an argument against the criminalisation of (trans)gender history non-disclosure rooted in privacy. Gender identity is a private matter and people should not be forced to figure it out or communicate it to others to have an intimate life. Mobilised in this context, privacy can be understood as a refusal of the state\u27s authority to order our gendered lives. The author argues that this mobilisation is compatible with leftist critiques ofprivacy. Finally, the author considers whether (trans)gender history non-disclosure is a criminal offence in Canada and concludes that it is not

The Concept of Consent under the Sexual Offences Act 2003

The concept of consent is fundamental in considering the crime of rape under the Sexual Offences Act 2003 (SOA). Consent was placed on a statutory footing for the first time by the SOA which defines consent alongside evidential and conclusive presumptions under sections 74-76, respectively. This article explores the position that unfortunately, neither significant clarity nor enhanced protection appears to have been embraced or achieved by the incorporation of consent