Straight Talk Radio

Ever Made a Bad Choice? Gary Zeune on Straight Talk Radio

By March 19, 2015 No Comments

Bad choices – well they are all over the news daily.  But what motivates an otherwise intelligent person to make choices that have profound negative consequences?  My guest Gary Zeune, founder of The Pros and The Cons, is a CPA and expert when it comes to less then exemplary behavior.  Profiled WSJ, NYT and many other national publications, Gary Zeune teaches 100+ fraud, auditing, ethics and corporate strategy classes every year.  Gary is recognized as #1 when it comes to fraud awareness and prevention and I’m honored to have him as my guest on STRAIGHT TALK RADIO.

Listen to the show here:  Gary Zeune featured on STRAIGHT TALK RADIO

Tired of traditional talk? People pontificating about this or that? The left or the right? Sometimes the truth is just off lost in the noise. Having learned life lessons the hard way, Chuck Gallagher, international speaker and author, cuts through the noise to share truth through transparency!

Nationally-known guests talk about what’s important to you – your life, your concerns and your success. So tune in, turn on to Straight Talk with Chuck Gallagher.

Now, here’s your host, Chuck Gallagher.

CHUCK: Hi, this is Chuck Gallagher with Straight Talk Radio on Transformation Talk Radio and I am so excited today. With Straight Talk Radio one of the things that we try to do is make sure that we bring you something that you can listen to as you’re driving in your car or listen to a podcast [01:00] and sit back and say, “You know, that was something that really worked for me.” This is Transformation Talk Radio so let’s think about things that can be transformative.

Now, I think most of you who listen to the show, at least on a fairly regular basis, know that I have a, how should I put it, a rather sordid past. At least at my age, and I’m 57 years old, but when I was back in my twenties, I was a CPA tax partner in a firm. I had testified before the Congress, I had written articles in the National Tax Magazine, I taught Continual Professional Education courses in 30 states. Man, I thought I had this thing whipped, but I was also stupid. I can actually think of other words to use, but I’m not going to use them for this is radio. The best way to put it is I was overextended and underfunded or maybe another way to put it is I had way too much debt and instead of using my God-given common sense to solve that simple problem, I made a wrong set of choices and ultimately created what is now referred to as a Ponzi scheme, although I have to admit, at the time I did not know what a Ponzi scheme was.

I’ve said many times, every choice you make in life has a consequence. The problem with doing something wrong or making an unethical set of choices, as in [02:26] to fall out of integrity, is if you understand that every choice has a consequence, there will always be one even if you think it won’t. And my consequence came in 1990 when the house of cards collapsed and even though I with the help the family and friends was able to make restitution to the people that I had so painfully stolen money from, the fact is it didn’t change what I did and there is a consequence that followed, and for me that was federal prison.

I will say that was a painful part of life and now some 30 years later or pretty doggone close to it, I find myself in a completely different situation here on Transformation Talk Radio with Straight Talk. Today the cool part about this is my guest is probably the nation’s premier speaker, author on issues of why good people make bad choices? Gary Zeune is a CPA, he owns a company called The Pros and The Cons!, which by the way I love as a classic title. I happen to be one of the cons on Gary’s speaker list. Through his organization we’re able to talk to people all around the country about how good people make bad choices and what takes place. I’m so excited to have Gary on the show because we are going to talk a lot about what happens and what he’s able to see because he brings a depth of experience that you won’t want to miss here on this show. So, Gary, welcome to the show.

GARY: Thanks, Chuck, and, Gee, I’m sure that none of the listeners today have ever done anything stupid. Let’s try to get this off on the right foot.

[Chuck and Gary laugh]

CHUCK: The funny part is, Gary, and you’ve seen this, I know, but I have been in audiences before when you come out and you start talking and you just openly admit, “Okay, I screwed up and here’s what took place,” and some people have their arms folded like, “I would never do anything wrong,” and it’s like, “Really?!” I mean, come on! Everybody has the potential. That doesn’t mean that everybody will commit a financial fraud as you know, but everybody has the potential to do something wrong and to assume that that’s not going to take place or that unethical behavior only falls in the realm of financial issues is a big mistake.

GARY: Yeah, one of the things that I always do to kind of set the stage, because you’re right, so many people sit there and they cross their arms saying, “I’m not that stupid.” I say, “Okay, let me ask you a simple question. How many of you are ethical people, ethical doctors or ethical CPAs or whatever audience we’re talking to?” Of course, they all put their hand up. What else they’re going to say, right? Then I say, “Let me ask you another question how many of you think it’s unethical to break the law?” And about 65-75 or 80% will raise their hand. “Let me ask you another question. If it’s unethical to break the law, but you’re an ethical person, then why do you speed whey you drive your car? It’s illegal. Why do you do it?”

So what I always try and do is kind of doing a drug case where you start with the low-level guy and you work your way up and you ease them into it and before you know it, you’ve got them admitting under that set of circumstances. “Now, of course I’d steal a million dollars.” So there is always a set of circumstances where somebody says, “Doing that is more important than my ethics, than me going to prison,” and people say, “No, it’s not. I’d never go to any prison.” Oh, really? Let me ask you a question. Is it illegal to do five miles over the speed limit? “A-ha.” Is it illegal to go fifty miles over the speed limit? “A-ha.” So why do you do five and not fifty? They’re both illegal. So why do you do one illegal act but not the other? Which almost everybody does. How do I know about all this stuff? Because I’ve done it. I mean, the fastest that I’ve ever got my motorcycle was 105.

[Chuck chuckles]

GARY: That was really stupid, way too dangerous so I stopped doing than and started skydiving.

CHUCK: Oh, my goodness!

GARY: Yeah, that’s real thrill. The jump master on my first jump was 14 years old and had 700 jumps. Yeah. [chuckles]

CHUCK: Noooo!

GARY: Yeah, 700 jumps and for a number of years now you had to go tandem three times before they let you go solo. Back in the year when I started, this got to be at least 20 or 25 years ago, you went solo the first time. Yeah, you put your feet up, you get out, your hands wiggle out under the high wing plane and you look over to your jump master, he gives you a thumbs up and you just let go. You fall away from the plane and the most important thing you’ve got to do, and you’ve got to have six or seven hours of training, the most important thing you have to do is you have to remember that when you let go of the plane, your body is like this because when your body’s like this, you flip upside down and the parachute is on the bottom. It doesn’t deploy very well.

CHUCK: Oh, no, no, that would not work.

GARY: Yeah, yeah, yeah.

[Chuck laughs]

GARY: That was the one time I thought I was lucky I didn’t do anything like that. I just landed in a cornfield. The difference is that almost everybody will drive 5 or 10 miles over speed limit, but we won’t do 50 even though they’re both illegal and the reason is their driving 5 or 10 over the speed limit is socially acceptable. People will do things even if they’re illegal if they’re socially acceptable. So, when people think that the rules aren’t fair, they’ll violate. The same reason probation didn’t work. Have you ever heard, “It’s my company and I can do whatever I want?”

CHUCK: Oh, yes!

GARY: Well, it’s not true and what business people do or executive directors, or non-profits, or non-profits, they count the commission I’m just going to say the [08:35] for generics, to make it easy. What they do is they say, “It’s my company, I can do whatever I want.” Well, that’s a form of bullying, whether they’re trying to bully the control, or the CFO, or the bookkeeper, or the auditor, or the tax guy, whoever it is, they’re trying to draw the line saying, “I don’t think so.” They’re saying, “It’s my company, I can do whatever I want,” it’s a form of bullying. Well, here’s the problem, it’s not true. The first part may be true. “It’s my company.” Let’s assume that’s true. They own 100% of the stocks [09:05] executive director, but, “I can do whatever I want,” it’s flat not true because we do not live in a free market society. If we lived in a true free market society, you’d do whatever you want and you can’t. You have thousands and thousands in fact tens of thousands of laws so if you’re a trucking company, the drivers are only going to drive so many hours in a 24-hour period and they have to have 8 hours of rest.

CHUCK: Right.

GARY: You have to keep brakes fit on the truck. The tire truck has so much tread on. There are thousands of laws, yet we all pay minimum wage. There are thousands of laws that we that we all have to obey. So you literally can’t do whatever you want. So the statement where it’s combined, “I do whatever I want, it’s my company. I can do whatever I want,” it’s flat not true so the moral of the story is if you’re a controller, if you’re a CFO, an auditor, a tax guy or just the warehouse manager or whatever it is, it’s not true. Don’t ever let anybody push you around like that.

CHUCK: You know, Gary, you said something a minute ago that really connected an interesting dot for me, and that is you made the comment, and I think I want to say this correctly, if it’s inaccurate correct me, but if it’s socially acceptable, then it’s, in the minds of people, it’s okay to break the law.

GARY: Correct. That’s why prohibition didn’t work, because we passed the law and now– Prohibition actually started ten miles from my house in a little town called Westerville, Ohio. Westerville was dry until, it was kind of a [10:39] claimed to paint until they voted on maybe three or four years ago. They finally got a [10:44] and wine cells into town. That’s why we all go five or ten miles over the speed limit. If you’re driving the speed limit, you know, unless people honk at you to get out of the way, right? So, breaking the law is socially acceptable and that’s why people do it, but going 50 isn’t.

Here’s kind of the analogy, and I use a lot of analogies when I speak because analogies are really powerful to explain things because if you can use an analogy with somebody that they already know it and accept something and link the new thing to it, they’re much more likely to understand it and remember. So, the analogy is we all go 5 or 10 miles over the speed limit, but most of the time we won’t go 30, or 40, or 50 over, because one, it’s socially unacceptable. Someone might call and report you, you’re going to get a hell of a traffic fine, plus two, the cops are going to come after you, right? Think of a situation where, even though it’s socially unacceptable, you would drive 30 or 40 miles over the speed limit so you would do something that you normally wouldn’t do.

So, you have a three-year-old kid, it could be like lose track of him and he’ll wander off in the street and get hurt. You call 911, “I’m sorry, we can’t come for two hours because there’s a big truck wreck on the freeway,” you’ll put you’re three-year old in the car and you’ll go 30 or 40 miles over the speed limit to get to the hospital.

CHUCK: Absolutely. Let’s do this, I hear the music in the background. It says it’s time for a break. I want to come back to that example because I think that example is very powerful. This is Chuck Gallagher with Straight Talk Radio. My guest is Gary Zeune and he is the owner of The Pros and The Cons! and is absolutely a master of understanding our human behavior and why we do some of the things that we do. So stick with us and let’s reconnect after the break with “thirty miles over the speed limit to save my child”. Stick with us.

[Commercial break]

CHUCK: Well, this is Chuck Gallagher with Straight Talk Radio. We’re back after the break. Thanks for sticking with us. You know, it’s always fascinating to talk about why people make the choices that they make. Today’s show is a really fun one for me because one of my good friends Gary Zeune is the owner of a speakers’ bureau entitled The Pros and The Cons!

Gary is a pro, I’m a con! I’m not sure that’s the best of things in the world to be categorized, but we’ve been talking about human behavior, why people do some of the things that they do especially when it comes to unethical behavior and perhaps illegal behavior. But before we went to the break, Gary was talking about social behavior and why people do some of the things they do and, Gosh, what would happen if your child was hurt and you needed to rush them to the hospital for medical care, would you go 30 or 40 miles over the speed limit and I said, “Absolutely.” Gary, let’s pick back up with that.

GARY: Yeah, what happens is that most of us think that ethics is a bright line or it’s black and white, and ethics for the most part depends on the situation that people find themselves in. So, your child gets hurt, 911 [14:21] can’t get there for a couple of hours, your child is seriously hurt. Of course you’ll go 30 or 40 miles over the speed limit, and it’s called “situational”. You’ll go more over the speed limit, you’ll break the speed limit and break a little more than you normally do, why? Because it’s more important for you to get your child to the doctor to see them, save their life than to be an ethical person “I’m going to go 5 miles over the speed limit”. So, what we all do, including me, is we adjust our ethics depending on what the situation is.

Let me give you an example. Let’s say that all of your listeners took a new job on Monday and they’re the Chief Financial Officer of some high-tech company taht just got a ten-million-dollar venture capital infusement It’s a high-tech company and you don’t need health insurance because, of course, the average age of the workers in a high-tech company is like twelve years old. They’re the only ones that know what’s going on.

[Chuck chuckles]

GARY: So you don’t need health insurance. So, you’re there three or four months and one day you go to work and you phone rings:

“Hello? Gary Zeune.”

“Honey, this is Sue and Alice (that’s your five year old daughter). Alice hasn’t been feeling well.”


“Alice started coughing up blood after you went to work. We’re at the hospital and she’s run some tests. She has cancer and if we don’t start 50,000 dollars worth of treatment, she’s going to be dead in six months.”

Well, here’s the problem, you don’t have health insurance. You make too much of your own medical care and you gain kind of [15:58], you don’t have time to do bake sales, your parents don’t have money, you don’t have equity in your house. Most people don’t have an extra 50 grand to [16:06]. But you’re the Chief Financial Officer. One of the reasons you just joined this company was because they just got a ten-million-dollar venture capital infusement and that money is going to last you for, let’s say, four or five years. So, you’ve got a pile of stock options to go work for this company. You’re going to have health insurance. So, here’s the situation, this is the money analogy to your child getting hit in the road, and you’re on your way, you’re going 30 miles an hour over the speed line to get to the hospital. You need $50,000 right away and let’s say it’s going to cost just a million dollars to do these treatments and you don’t have the money and no insurance. [16:51] you’re going to take it and you’re going to do without getting paid? You’ve got access to ten million dollars. One of the question, I set this situation up in class and asked, “How many of you are going to steal fifty thousand dollars, a million dollars in total?” And usually fifty or sixty or a hundred, and people typically about 10% will raise their hand.

CHUCK: Okay.

GARY: Now, the other 90% don’t put their hand up. So here’s the question: if you don’t steal the money, you can’t pay for the treatments, that’s the only way to you’ll get treatments, how many of you are willing to let your daughter die?

CHUCK: Right.

GARY: And usually nobody holds their hand up.

CHUCK: Absolutely.

GARY: Here’s the question. You can’t have it both ways. You can’t say, “I won’t steal the money,” and yet have the money to pay your daughters’ life. So either steal the money and pay for the treatments and hope to save her life or you deliberately make a decision to let your daughter die. Pick one. And at this point people’s brains will start to process; oh, my God, what am I going to do?” So they’ll start to come up with all kinds of [18:04]. Now, remember I said you can’t borrow the money. “Well, I’ll sell my house,” You don’t have the time to sell your house so you’re down to your last choice which is steal money. Now, most of you are going to say “I’m not stealing the money, I’m just borrowing the money.”

CHUCK: Right.

GARY: It’s called rationalization in fraud [18:24]. So all rationalization is, is you’re changing your behavior because you’re in a situation that you don’t know any other way to solve the problem so you’ll rationalize doing something that you normally wouldn’t do, like steal a million dollar, fifty thousand dollars [18:41]. So if you say, “I’m not stealing the money, I’m just borrowing the money,” that means you have to be telling yourself you’ll pay it back. So, what’s a way that you could tell yourself that you’re paying the money back so you’re not stealing it? Well, when it comes to go public—

[Chuck laughs]

GARY: Remember, you said, “I’ll sell my stock. I’ll put the money back, so I’m not stealing it, I’m just borrowing,” and that’s the kind of mental gymnastics that people go through. So, normally you wouldn’t drive 40 miles over the speed limit, but your daughter just got hit by a car. The same rationalization is, different situation than normal, the only difference is one involves your daughter got hit by a car, the other is your daughter has cancer. So, one’s driving, going 40 miles above the speed limit, the other is you’re taking the money, but in both situations you’re rationalizing breaking a law.

CHUCK: Now, Gary, you and I both easily can talk, probably for hours, on what years ago was dubbed the fraud triangle.

GARY: Yep.

CHUCK: Need, opportunity, rationalization. And I know we’re going to be running up on a break here in a minute, but I really want us to kind of play with that now and perhaps after our break, because it strikes me, and maybe I’m missing something, that really every choice that we make kind of still falls into those three things.

GARY: It does.

CHUCK: And let me give you an example. Where am I going to eat for lunch today? Or what am I going to eat? Well, I’m on a diet. So I have a need. I need to eat. Now that’s simple. It’s not a hard need. It’s not hard to defy it, but there’s a need. What happens to being within reasonable driving distance of my office that I can grab for lunch? There’s my opportunity. Now, the question comes down to, do I stick to my diet and ditch the carbs, or do I rationalize that, well, you know, having a hamburger, which is on the diet, but with a bun, I mean, the bun is not really that big of a deal and who’s going to know anyway, still comes back to that same triangle. So it strikes me that maybe as human beings everything is really based upon what is our need, what’s the opportunity and how do I rationalize it? It just goes to different levels at some point when gets a bit absurd like the child with medical care or the one that was hit.

GARY: Yeah. You’re absolutely right. Virtually, every decision we make has those three components and it was first described by doctor Donald Cressey back in the 1930s and then after in the 1940s, and then he went to a prison in the early 1950s, interviewed 200 embezzelers, found out every one of them had those three things. So the need to solve a problem, so it’s either money or lunch. Opportunity like driving your car, there aren’t many cops around so I can speed. And if I have a hamburger with the bun, nobody’s going to notice [21:50] in that situation. And then the rationalization is it’s called “moral balancing”. Well, if I eat carrots all day, I can have a tube of ice-cream at night.

CHUCK: Right.

GARY: And so most people have a relatively fixed amount of moral behavior so when you’re more moral than you normally in one area, you’ll let it go in another area. For example, if we have any CPAs or [22:14] on the line, very often you’ll find, okay, the owner of the twenty-million-dollar company, I stopped him from recording a half a million dollar sale in the wrong year to get the bank loan renewed, but okay, they can use five thousand dollars of the company money for personal vacation. So, I morally was okay when the big stuff was on the table, so I’m going to let this little thing over here go. So, in your example of luch, “Okay, I’m going to stick to my diet with the big stuff, but I’ll have the top of the bun not the whole bun.”

CHUCK: [laughs] I understand. I do understand. By the way, I did not have a bun today.

[Gary and Chuck laugh]

GARY: We all tend to do those things. I keep this up and I still do it, but at least I know I’m doing it and so I call myself on it, so I have no feeling of guilt about it because I [23:12] today. So that’s what business people do. They say the rationalization is, remember, we said twenty-million-dollar company, half-a-million-dollar sale in the wrong year, so let’s say that sale was supposed to be on January 3 and they go ahead and recorded it on December 27. Why? Because they need the extra revenue and profit to get the bank loan automatically renewed.

CHUCK: Right.

GARY: The forklift driver in the warehouse for the sales taking place says, “Well, I should have gotten a bonus. I didn’t get a bonus and the owner still went on that $5,000 vacation and ran it through the company.” Now, how did the forklift driver know that? Answer: the forklift driver was good friends with the bookkeper who wrote the check that reimbursed the owner’s $5,000 trip that was clearly personal.

CHUCK: Oh, I always hate it when the break comes up, but you know, we’ve got to go back to the example, to finish up the bookkeeper and the owner and the forklift driver. This is Chuck Gallagher with Straight Talk Radio. And you know it’s been fascinating this far to talk with Gary Zeune, the owner of The Pros and The Cons! And if you have any interest in really understanding how this works, visit Gary’s website. We’ll be back in just a moment with Transformation Talk Radio, Straight Talk Radio with Chuck Gallagher.

[Commercial break]

CHUCK: Hi, this is Chuck Gallagher with Straight Talk Radio and we’re back after the break. We are talking with Gary Zeune. Gary is literally, as far as I’m concerned, the nation’s foremost expert when it comes especially to talking with folks in the accounting industry about issues of fraud and ethical behavior and what really happens that the [24:58] behind it and we were talking before the break about the reality that all choices we make fall into three categories where three things come together to create the choice. Need, opportunity and rationalization. Gary, I hate it that we had to break as we did, but you were talking about that business owner who advanced a sale and we’ll call it this year that really was next year’s sale, but advanced it this year to get the bank loan and took out some money from the account, a small amount, $5,000, that was clearly a personal expense and expected to be reimbursed for it. Let’s talk a little bit about sometimes how these things get exposed, because you were going down that road and that’s really so practical.

GARY: Yeah, and this is really, really common, especially with small companies, non-profits, government entities is that people will use the company, and I’m just going to take company generic, like for any kind of entity. They’ll use the company as their own personal piggy bank and they’ll rationalize, “Well, it’s my company, I’ll do whatever I want.” We both talked earlier about how that just flat isn’t true.

What happens is that the owner says, “Oh, it’s a twenty-million-dollar company, I only spent five thousand dollars on the trip to Vail for the family.” Well, the forklift driver, as we started talking about before the break, says, “That could have been that $5,000. I haven’t gotten a pay raise for three years. That $5,000, that could’ve been my pay raise.” The forklift driver will start to see a little bit of inventory, sell it on Craigslist, or flee markets, or eBay, or whatever, and that’s rationalization. And the forklift driver knows it’s wrong, but the rationalization is just whelming. “I’m just getting what to do to me.” And what the business owner doesn’t understand, the boss doesn’t understand, is that people behave the way they see those above them behaving. So when the lower-level people see the upper-level people using the company as their own personal piggy bank, the low-level people say, “Well, it must be okay.” In other words–

CHUCK: Sure.

GARY: Lower-level people mimic the behavior of the more powerfull people. That’s why children grow up to be like their parents.

CHUCK: Right.

GARY: What happens is that cheating and fraud, even at small level, literally becomes part of the corporate culture. All you have to do, and it’s irrelevant what the size of the organization is, look what just happened to General Motors with the ignition and they didn’t report the ignition switches for 10 years and many, many people, according to press, knew the ignition switches were defected. So what they said was, “It was a customer complaint issue,” even though when the key turned off, it turned off the air bag and the power stirring. People couldn’t drive their car and allegedly GM at this point have been reported aknowledging that 13 people were killed because of it and law-practicing lawyers are going to say, “It’s probably 50, 60, 70 or a bigger number.”

CHUCK: Sure.

GARY: So here’s the point about [28:16]. There are millions and millions and millions of General Motors cars out there and only 13 of them allegedly, that’s according to GM, have been killed because of the ignition switch. So 13 out of millions and millions of cars is “in material”.

CHUCK: Right.

GARY: And so business owners and executive directors and non-profits, government people, they literally don’t understand how their behavior forms the basis for the way many people, not all certainly, but the way many people will behave inside the organization. So when low-level people see what’s going on at the upper levels, the lower-level people many times will start to do, too. Then it becomes part of the culture and it’s impossible to stop. Would you let it get started if it’s so impossible to stop?

CHUCK: Yeah, and Gary I have to say, like you, I have the opportunity to speak to a number of companies around the country and certainly not limited to just CPAs, and it’s fascinating, and I don’t mind saying this on a public basis, I get hired for one of two reasons. Either, a) the company truely has a culture of ethical behavior and you can tell that whenever you’re doing the interview with the folks at HR or Accounting and so forth before the presentation, or they know that my presentation on ethics is a legal defense under the United States sentencing guidelines so that if someone does something wrong or illegal, they can say, “Well, but we taught them to do different,” even though you can tell at the upper levels that I’m just a surface, a defense, for lack of a better way of putting it.

GARY: Yeah they’re trying to put their ducks in rows for a plausible deny ability. “Well, we gave them all their training, we’re not responsible.” Let me give you an example of how that doesn’t work. Remember, it’s probably been 10+ years since Domino’s had “It’s 30 minutes or it’s free”?

CHUCK: Yes. Absolutely.

GARY: Yeah, right. So the strategy was, when people order a pizza, when do they want it? Right now. There’s nothing wrong with that you want your pizza right now. One of the ways you make more money is to guarantee what you’re doing, so 30 minutes or it’s free. The problem was that the way the system works in many of the stores, from what I’ve been able to find out, is that it’s if the driver got the pizza there within 30 minutes, he’ll get a tip of 25 or 50 cents. But if they were late with the pizza, the company would take three bucks out of their pay. That was the pay for the ingredients, because if you don’t have a punishment, then the drivers will have their friends order, deliberately be late, and so they’d have to give the pizza away for free, so it’s a control mechanism. Well, the problem is, what business people don’t understand, and I mean everybody that’s in charge of people, what we very often don’t understand is that any time you change a system, people will always change their behavior. Behavior never stays, then building on top of that, people behave the way you pay them to behave.

CHUCK: Right.

GARY: So Domino’s reportedly had thousands and thousands and thousands of reports in their file about drivers getting in the little fender benders and getting speeding tickets and going through four-way stops, etc, etc. So they had the system for, I don’t know, four or five years and it blew up one evening when a young driver, 19 or 20 years olds, went through a four-way stop and I think it was in East Saint Louis, Illinois, and ran over a woman at a cross walking and killed her. Dominos thought they had two really good defenses and they went to trial. One defense was, “We tell them all the time: obey the law.”

CHUCK: Right.

GARY: And the second defense was the drivers are independent contracters, they’re not employees so Domino’s went to trial, lost the lawsuit and I think the jury awarded something like 2.7 million dollars in that case.

CHUCK: Okay.

GARY: Domino’s didn’t stop and think, “Well, if we pay them a little bit to deliver on time, we have this big punishment if they deliver late and we have to give their pizza away free, the drivers are going to change their behavior.” So when they put that system in, it wasn’t a matter of if one of the drivers was going to run over someone and kill them, it was a matter of when. And what business people do, what bosses do, is they change the rule and don’t realize that people are going to change their behavior. What do you think after Congress changed the law and now children have to go in the back, the car seat has to go in the back. Statistically, it’s much safer for kids to be in the back rather than in the front because [33:31]. Well, there are now many more children that die being left in hot cars than were ever killed by airbags, because their parents get distracted and forget they’re back there.

CHUCK: Right.

GARY: So, if you change the rule or set up a new system, what you have to do is to think forward, how will people change their behavior under the new system and then that what you design for.

CHUCK: Now, Gary, I want to veer a little bit in a slightly different direction. I get what you’re saying there, but I happened to be out in L.A. doing a presentation and I was talking about the triangle. You know, need, opportunity and rationalization. Because one of the things that you and I both know is from time to time there are some people who’s, what I want to call it, morality button is very high on certain things and is, “I would never ever steal.” So I’m sitting there and I was an off-the-cuff example, by the way it’s not true, but I’ve been married for almost 16 years and so I said, “I’ve been married for almost 16 years so let’s play this potential example out.” Gosh, well, the spark isn’t the same as it was 16 years ago, then again I’m 16 years older but that’s a different issue, but the spark isn’t quite the same. You know, I live on the East coast, but I’m here in Los Angeles and it’s March madness and I’m sitting at the bar watching [35:02]–

[Gary laughs]

CHUCK: So painful. This really nice young lady comes, sits beside me, a little younger than I am, and she gets to talking about bascketball. We’re having a really pleasant conversation. It’s a noisy bar and of course everytime you check into the hotel, they ask you how many keys you want. For the life of me, I haven’t figured that one out, but aparently it’s to share! So she sets a key down and she says, “You know, it’s going to be much quieter in the room. Would you like to watch the game there?” Oh, well let me think. Need. Gosh, it’d be nice if there were something a little more zippy sexualy taking place and, well, the opportunity is here. I’m in Los Angeles and she just lay her key down and and after all, who’s going to know?

GARY: Right.

CHUCK: It kind of comes down to what you don’t know won’t hurt you. And with that said, we’ll get back to that right after the break, because what you don’t know will hurt you, as Gary Zeune says. Owner of The Pros and The Cons! This is Chuck Gallagher with Straight Talk Radio. We’ll be back in a moment.

[Commercial break]

CHUCK: This is Chuck Gallagher with Straight Talk Radio. We’re back and this is the last segment we have with Gary Zeune, owner of The Pros and The Cons! Gary is a nationwide speaker. He talks with audiences all over the country and outside of the country on behavior, why we do what we do. And one of the things that I led up to, as we were finishing that third segment going into the fourth, which by the way none of which was true, was going to that rationalization or that concept that, well, what you don’t know won’t hurt you. And Gary you say, “What you don’t know will hurt you.” Let’s talk about that.

GARY: Yep. Many few things stay private so the question is, even if it does stay private, are you willing to take that risk? Is one night worth that kind of risk?

CHUCK: Right.

GARY: And that’s the rationalization. Many people will say, “Well,you know, I’m true blue, I’ve never cheated on my spouse,” and for most people that’s true although the last numbers I saw about [37:15] within just a couple of percentages points as many women now admit to having affairs as men, just on some show on TV a couple of years ago. So, let me give you one that’s even more forceful because what I like to do is to put people in a situation where even though they didn’t last long on as an ethical person saying, “Oh yeah, I would have to think about doing that.”

If you remember in the first segment, I said let’s pretend your daughter is sick and you need to pay for $50,000 worth of treatments. So, let’s say it’s going to take $50,000 a week, how many of you are going to steal the money? Usually about, as I said, about a third will hold their hands up. Okay, so here’s the choice. Steal the $50,000 a week or knowingly let your daughter die.

CHUCK: Right.

GARY: So here’s the ethic choice. Remember I said ethics is rarely absolute. There are a few things in life that are absolute. Ethics is situational. So let me ask you a question, how many of you are willing to do five years in prison for stealing a million dollars to save your daughter’s life? Almost everybody will hold up their hand. So, here’s the question: why are you willing to go to prison, but you won’t allow yourself to say, “I’d steal the money“?

CHUCK: Oh, that’s a powerful question.

GARY: Most folks would do the crime, but they don’t want to do the time. Most business people, most honest people are willing do the time, but not the crime. Or backwords.

CHUCK: [laughs] Okay. That’s a fascinating thing to hear.

GARY: How is it ethical to knowingly let your daughter die and when you’ve got the ability to potentially save her life? And even if you can’t put the money back, because remember you’re just borrowing it, you’ll pay it back, and so even if you can’t put the money back, it’s going to cost you probably a year, five years in prison. So how’s it ethical to let your daughter die when you can potentially save her life?

A couple of years ago I was teaching in some place and I said, “How many of you would let your daughter die?” After the first and only time ever, this lady holds her hand up. I thought she was joking so I looked at her and said, “No you wouldn’t.” She said, “Yes, I would,” and I said, “No, you wouldn’t,” and she said, “Yes, I would,” and I said, “Oh, really? What do you do for a living?” She says, “I’m a professor at such and such university here in town.” I said, “Really? How many kids do you have?” “None.”

CHUCK: Right.

GARY: And everybody else in the class, like 49 other people in class just cracked up. So here’s the point. If you don’t have children, you’re not qualified to answer the question.

CHUCK: Right.

GARY: Right? And because everybody– I mean, think about this. if your child is out in the street and here’s a big truck coming down the street and clearly does not see your three-year old, how many of you would run out, push your child out of the street, and you know you’re going to get run over and maybe killed? Everybody will do that, right? Here’s an ethical question. So you’ll give your life to save your child, but you won’t let yourself, you won’t allow yourself to steal a million dollars. Yes, you would. Sure.

The reason I make it so extreme is because most people won’t connect with the person at the bar, but if the stakes are high enough, if the need, the opportunity and the rationalization. So the need is I need to pay for the treatment, the opportunity is there’s already [40:43] in control. My boss trusts me. And the rationalization is, I’ll pay the money back. So a really powerful fraud prevention and deterrent is ask people what will happen to their family if they do something wrong and they go to prison.

CHUCK: Right.

GARY: Because most people will put themselves at risk, but they won’t deliberatly put their family at risk. And of couse, they’re eventually going to get caught so, they’ll take the risk for themselves, but they won’t take the risk for their family especially if they’re the primary breadwinner.

CHUCK: Right.

GARY: So, what will happen to your family if you go to jail? I’ll give you a really good example. We had a guy here in Columbus, my little hometown here in Ohio, Columbus, Ohio, with the Chief Financial Officer [41:34]. One day, long story short, he picked up the phone and wiretransfered the entire checking account balance of 7.2 million dollars to himself from Austria.

CHUCK: Okay.

GARY: He left his wife a message of what he’s done. She gets home and hears it and calls the FBI and turns in her husband.

CHUCK: Well…

GARY: He goes to the big house, The Great Barr Hotel, it was 12, 15 years. She got fired from her job because of what her husband did. They had to move to a town about 30 miles away because the two kids were getting beat up in school beacause of what the dad did.


GARY: And of course, he’s in prison and can’t do anything about it.

CHUCK: Right.

GARY: So, think about what will happen to your family? How will they live? Will your spouse get fired? In most states of employment they will. The employer says, “Well, if the husband, if one of them do it, what are the odds the other one won’t do it?” [42:31] spouse who’s left behind. So they ended up on welfare. I think it was [42:35] in the first four or five years.


GARY: Then somebody took a chance on her and she got a new job and he got out of prison I think about two years ago. Fortunately, they’re still together. As you know many of white-colour criminals their spouse will divorce them I think the percentage is like 85% or something like that that are divorced by their spouse.

CHUCK: Gary, let me ask you a question. We’re in the last segment and I know that you were just featured in a Wall Street Journal Market Wwatch article which kudos to you for being able to pull that off. I know you’d worked many, many years at creating a fabulous business, but to be featured in the Wall Street Journal, that’s up there. But I have to ask you this question, and since I’m one of them and I’m not sure what your answer’s going to be—

[Gary chuckles]

CHUCK: Let’s go there. There are some people, especially when you look at the comment that says, “Once a con, always a con. People can’t be changed.” You’ve had the opportunity to experience a lot of people who have made serious mistakes in life and have been convicted. What’s your experience of trusting or believing that you can actually find some level of redemption or change in life?

GARY: I get that question all the time. How do you trust? And the answer is, I don’t have to. I’ve got all the money.

CHUCK: Well, that’s true.

GARY: [laughs] Typically, it’s pretty easy to tell, for example, after the article was in the Wall Street a couple of days ago, I’ve gotten as you can imagine just a tone of requests. “Can I get your secret?” And it’s pretty easy, frankly, to pick the ones out or figure out the one who wanted to do presentations and the reason is they want a platform to say it wasn’t their fault. You know?

CHUCK: Right.

GARY: The FBI [44:44], “I did it for my spouse.” So I tell everbody that writes me, because everybody says, “What are the [44:53] of being a speaker?” and the answer is two really simple [44:57]. One is you have to have a [45:00].

CHUCK: Right.

GARY: The second one is you have to take responsibility for what you did and you have to admit it. You have to be willing to answer any question that somebody puts to you, whether it’s me, or the press, or The Wall Street Journal or [45:13] or a profiler at Forbes a couple of weeks ago as you know.

CHUCK: Right.

GARY: You have to be willing to admit what you did, take responsibility and answer any questions. I tell them right up front and I tell reporters this, you call me up and say, “I want to interview you on some of your paper.” Okay, you can ask him any question that you want. The only thing that is off limits is their personal sex life. Unless it had something to do with the crime like you stole money to have an affair. Then it’s fair game to describe this as a part of the crime.

CHUCK: Right.

GARY: Or for example, if it’s been a recent crime. There have been several speakers who are getting death threats and so their families have gone off to live place else. Okay, you can ask, but they’re not going to tell you where their family is. You can say, “But then the impact on your family,” but they’re not going to tell you where they’re at. So there are a handful of things that are off limits, but not many. And frankly, it’s pretty easy to tell just by the way the emails or the conversations go, who’s ready to admit what they did and who isn’t ready. So I’ve been doing this since 1987 so I just got a good sixth sense about that.

CHUCK: Gary, there was a guy out in California. Well, you know what? Maybe that’s going to be on another show.

GARY: Okay.

CHUCK: This is Chuck Gallagher. This is Straight Talk Radio and my guest has been Gary Zeune with The Pros and The Cons! Go to his website and check out the [46:43] of people that he had. There’s a lot of people that work with Gary who are professionals, who absolutely can help your organization understand what you need to do to create a culture of ethical behavior and to prevent fraud. Gary is a master of that and it’s been my honor to have him here on Straight Talk Radio. It has been straight talk. Hopefully, it has been transformational to you, because we are on Transformation Talk Radio. This is Chuck Gallagher. Stick with us. We would love to have you back next week when we’ll have other exciting guests on Straight Talk Radio, and remember, every choice has a consequence.

You’ve been listening to Straight Talk with Chuck Gallagher. Tune in each week on, each Monday at 2 p.m. Pacific, 5 p.m. Eastern, as Chuck Gallagher, international speaker and author, cuts through the noise to share truth through transparency. Nationally-known guests talk about what’s important to you – your life, your concerns, and your success. Visit for more information and turn on to Straight Talk with Chuck Gallagher.

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