Study finds that money, revenge, morals motivate whistleblowers to expose tax fraud

phys.org | 10/5/2017 | Staff
KHALED (Posted by) Level 3
Revenge-seeking ex-lovers, jilted business partners and vindictive former employees are among the nearly 12,000 whistleblowers who reported tax fraud to the IRS in 2017. An estimated $3 trillion dollars is lost worldwide in tax evasion every year.

A study by Portland State University School of Business accounting professor Cass Hausserman finds that people who expose others of tax fraud often do so as revenge that's disguised as their moral obligation. Blowing the whistle is also motivated by a financial gain for the whistleblower. Revenge is commonly considered a primary reason why whistleblowers report tax fraud—so much so, that it's often referred to as "the revenge tax."

Hausserman - Study - Influence - Revenge - Rewards

Hausserman's study, "The influence of revenge and financial rewards on tax fraud reporting intentions," revealed that whistleblowers often justify or disguise their revenge through a re-framing of the motivation into a moral obligation. The study published in the March edition of the Journal of Economic Psychology.

"People with a revenge motive justify their decision as moral obligation when they plan to blow the whistle on a colleague for tax fraud. They most likely feel better about reporting someone because it's their 'moral duty' rather than for a more negative reason, such as revenge," said Hausserman.

Revenge - Obligation - Money

What does this tell us? When revenge is disguised as moral obligation, it's sweeter than money.

Research on the...
(Excerpt) Read more at: phys.org
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