Uncountable Costs – The Hidden Harm of Financial Crimes on Mental Health

30 May 2024


It’s easy to think about financial crime as a problem of numbers: whether we consider sums of money laundered, amounts of assets stolen through fraud, or even fines imposed on businesses by the regulator, the negative consequences of financial crime can apparently all be summed up by a series of figures. Most articles on the topic feature some astonishing numbers (ideally it involves the word trillion) in the opening paragraph, and while the intention may be to shock the reader into paying attention, it can sometimes seem that this approach to defining the issue serves mainly to reinforce a particular way of thinking, which prioritises the money and finance elements of money laundering and other financial crime.

Clearly, these concerns do need to be at the forefront of our response to financial crime. Indeed, levels of public awareness around the immense economic damage that crimes like corruption and fraud inflict still seem far lower than they should be (the to fraud certainly suggests that financial crime is not yet a UK voter priority, although increasing attention is being paid to the problem). But only considering the economic harm of financial crimes can blind us to a deeper, darker reality, which is that these types of criminal practice, along with the predicate crimes that underpin them, are devastatingly harmful in ways that are much harder to quantify than purely monetary costs. To name but one of many examples, environmental crime, which has been a focus of Themis’s recent research in projects such as has been shown to obliterate entire ecosystems and communities, not simply inflict economic damage on them.

Perhaps the most pervasive and yet overlooked harm that financial crimes cause is the psychological effects they produce, not only in direct victims, but also more generally. These harms are not imaginary or immaterial – they have clear impacts and are well-attested. For example, a UK survey published in March 2024 found that 60% of fraud victims experienced mental health distress after being affected by financial crime. For over a quarter of respondents, psychological strain was reflected physically, in the form of weight fluctuation, headaches, and the onset of panic attacks. This reinforces the findings of a 2019 study on inhabitants of Madrid, which found that, for its research population, ‘the probability of having mental health needs increased and quality of life decreased as the economic impact of fraud on family finances increased’.

Even those who are not the direct victims of financial crime can be psychologically affected by it. In February 2024, Ghanaian psychologists published a study which found that, in the words of the authors, ‘witnessing corruption among state institutions and government officials, and the perception that the rich could influence these officials for personal gain, was strongly associated with depression and anxiety symptoms’. It is confronting that this study was conducted through a survey of university students, who had an average age of 22 - widespread financial crime, in the form of political corruption, is capable of undermining, if not fully destroying, the optimism and hope of whole generations of young people.

The changing nature of financial crime is set only to multiply and intensify its psychological impacts. For instance, measures to protect against payment fraud, such as the implementation of two-factor authentication for online bank account access, have driven criminals to engage in far more personal types of scams that can bypass system controls by making an apparently genuine social connection with a victim. These are best exemplified by so-called romance scams, which rely on the establishment of an intimate relationship between scammer and victim, as a previous Themis blog explains at length.

Essentially, romance scams involve a financial criminal deliberately targeting an individual’s most personal vulnerabilities to extract money from them, through long-term deception and manipulation. This has meant that the anguish and embarrassment often experienced by fraud victims can be felt even more deeply, sometimes with tragic consequences. In 2021, a 43-year-old man named Chris Leeds took his own life, apparently as the result of falling victim to two financially and emotionally devastating romance scams. Mr. Leeds’s brother described the impact of this on his family: “[Chris] was loved, no, adored by us all, and we miss him so, so much. It leaves such a hole in our lives.”

What cost can be assigned to a loss like this? What compensation can be made for the absence of a father, a brother, a son? How, equally, can we measure the generational impact that rampant corruption has on a nation’s ability to renew itself psychologically, when realistic hope appears impossible in the face of pervasive grift and theft?

The difficulty of offering any decent answer to these questions gives some explanation as to why the emotional and psychological harms of financial crime are much less frequently and seriously discussed than its economic impacts. This does not mean, however, that we should avoid these discussions. Rather, the realisation that financial crime wreaks immeasurable psychological damage should reaffirm the resolve and determination of all those involved in preventing it.

In fact, one could go further, and suggest that an understanding of the effects of financial crime on individual and general mental health should provoke an equivalently emotional reaction on our part. The fight against financial crime should be seen not just as a technical matter of securing and strengthening our economies (although it certainly is that), but also as a moral struggle against the criminals who inflict uncountable harms upon our planet and its people, that demands our impassioned engagement if meaningful victories are to be won.

It is a commitment to contribute to this struggle that drives the work of Themis. We aim to reduce the global impacts of financial crime through technological innovation, investigations and intelligence-gathering, training and research, and the provision of outsourced anti-financial crime services. This is also what animates the work of the Themis Foundation, an independent charity which Themis supports, whose mission is to support victims of financial crime through advocacy and the provision of grants to partner organisations.

In the UK and Ireland, Samaritans can be contacted on freephone 116 123, or email [email protected] or [email protected].

Written by Henry Wyard, Financial & Environmental Crime Researcher, Themis

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