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The 50K Lie

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Just when the post-election theme of lying seemed to be receding into the background, the revelations about General Petraeus' affair became our national obsession. And post-Petraeus, there will certainly be another incident in which someone who's supposed to be a hero self-destructs in a web of lies and deception.

The "why"s are for the psychologists, moral philosophers, and experts on ethics. But there's a practical aspect to all this -- what would the world be like if we all became better at catching lies in the making? Would there be less lying all around? Maybe not, but there would likely be fewer victims if people could learn the signs and signals that they're in the process of being duped. In the course of researching this article and my previous post ("A Little Lie from the Heart"), I read Pamela Weber's 2010 bestselling book Liespotting, and watched her TED talk on the subject. These were eye-openers -- too bad for me she hadn't published her work 20 years ago. It might have saved me from making a serious business mistake. Here's what happened.

I'd just finished the annual River Rat Race, a time-honored event in which several hundred people partake in a pancake breakfast and then hit the Millers River with their canoes, paddling from Athol, Mass. to the neighboring town of Orange, five miles downstream. This was my sixth year as a River Rat racer, and I didn't really participate to win. I just liked being in the game. Although the race took place in April, it felt more like a late fall New England day. The air was cool and crisp and the water was cold and choppy. I was happy to beach my canoe and come ashore dry.

The paddling was invigorating and Orange was awash in good vibes. The event was capped off with a traditional bash that took place in the backyard of Mike's Place. Replete with hotdogs, burgers, chips, beer and soft drinks, the gathering was small-town America at its best. For me, it was about to become the scene of human nature at its worst.

The incident started when I was approached by a fellow I'll call Tim. Tall, trim, and clean-cut, he presented himself well. After congratulating me on my performance, he said that Mike told him to talk to me about a potential short-term, high-return investment. Mike was my buddy, and I could always count on him to get me on the inside track.

The deal involved a liquor store that was up for sale. According to Tim, it was highly undervalued and, with a little attention, could become a lucrative business. It had all the ingredients for success, from location and square footage to ample parking and a town that was easy on granting liquor licenses. All he needed was some seed money for a deposit on the store. Once he snagged the license, it would be a piece of cake to secure additional funding. He'd pay me back within three months, plus another $250,000. His calculations and knowledge were impressive -- he really seemed to understand the opportunity at hand. I liked his slightly cocky style, too; he reminded me of myself when I was starting out in business.

The idea of five-folding my money fevered my brain -- I'd never made money that fast. I'd invested in restaurants, condo conversions, even small housing developments. Those took time. This was a different kind of business game, and I wanted to play.

So we set up a joint account and I wrote a check for $50,000, then went about my business while Tim secured the liquor license. A week passed. Then another. Nothing from Tim. As it turned out, the only thing Tim secured was getaway transportation after he cleaned out our bank account.

With the help of a private investigator, I learned a few sobering things about my wayward business partner. One, he was a con artist and a compulsive gambler with serious debt. Two, he'd served time, which meant that by state law, he couldn't own a liquor license. And three, the down payment turned out to be $10,000, not $50,000. The current liquor store owner was sympathetic to my plight, but refused to return the down payment because of the opportunity loss he'd suffered.

Two months later, the PI found Tim in Florida. Tim was in the process of getting evicted because of failure to pay rent. Apparently, he was broke again -- my money had vanished into the ether.

I was furious and ready to pounce until the PI chimed it. "Want a piece of advice, Mr. White? Let it go. You won't get a nickel out of this guy and you'll spend twice what you already lost trying to get it back. If you go to the police, he'll probably get sent up again, but what good will that do you? Just move on."

I grudgingly followed his advice and eventually chalked it up to experience. And as the old saying (attributed to various people) goes, "Good judgment comes from experience, and experience comes from bad judgment."

In hindsight, I was foolish for not even doing a minimal background check on Tim or talking with the liquor store owner about the deal; either would have saved me the $50,000 I tossed out the window. I missed some obvious initial cues, too, an oversight that I'll chalk up to the third Bud I was consuming when Tim first approached me. Like the fact that he gushed over my canoeing prowess when I actually finished toward the rear of the pack. Like the fact that Tim didn't actually have to know Mike to get his name. (The sign over the tavern, "Mike's Place," was a pretty good clue! Mike later told me he'd never met or heard of Tim.) Or the fact that my successful real estate and restaurant run was a matter of public record. In short, I was a total sucker.

After reading Weber's Liespotting and watching her video, I learned some additional truths about the 50K lie that will help me in the future. First, as Weber says, lying is a cooperative act. While I didn't deserve to be cheated -- no one does -- I facilitated the lie. I was hungry to prove that I had the Midas touch, and that my success in real estate and as a restaurateur could extend to anything. That need jammed the very radar that had served me so well in the past, allowing an intruder to enter my world and steal my hard-won earnings.

Second, I ignored the telltale verbal cues and body language that would have been obvious warning signs to a good lie-spotter. Tim's "verbal dodging," relaying way too much detail about his (bogus) past, and "qualifying language" ("In all honesty, Rob...") were red flags. Ditto for his overly intense, nonstop eye contact and his "duping delight" smile at the conclusion of the deal (as if to say, "Ha, I pulled it off!" -- the OJ smile).

As I recall the story, I still feel a tinge of anger -- at Tim and at myself. But then I settle back and focus on the real challenge: to become a good lie-spotter without becoming a cynic.

For more by Rob White, click here.

For more on emotional intelligence, click here.

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