Bring A Friend

Groups of people are better at detecting lies than a lone individual, according to a 2015 paper by researchers at the University of Chicago Booth School of Business. What made the difference, they concluded, was group discussions held after people met with a liar. Before buying into anyone’s sales pitch, talk it over with your partner or friends. Ideally, bring them along.

Watch Out For Jargon

The SEC this month accused three California businessmen of recruiting real estate investors "under the guise of investment seminars with buoyant slogans," including a promise of "indestructible wealth." Whatever the merits of that case, inspirational cliches, impenetrable jargon, and euphemisms are common means of distraction. Look out for "fact-deficient, obfuscating generalities," or FOG, research firm Rittenhouse Rankings advises. The firm analyzes earnings reports looking for FOG and uses the results to score companies on their executives' candor. 

Root Out Liars With Tough Questions

Lying can be mentally taxing, and it gets tougher on liars if their questioners are creative, and maybe a little ornery. According to a 2010 paper on the topic, the goal should be to “raise the cognitive load” of a conversation in ways that trip up liars more than truth tellers.

In a law enforcement setting, this might mean asking someone to tell her stories in reverse order, or demanding he maintain eye contact throughout a conversation. In a financial advisor’s office, it might mean asking creative, blunt, or unexpected questions. The study showed “unanticipated questions” boosted lie-detecting accuracy from no better than chance (50 percent) to as high as 80 percent. 

Blunt questions can also lead to topics an advisor might be trying to avoid. Onora O’Neill, a philosopher and emeritus professor at the University of Cambridge, suggests: “Have you got any of your own money in your product?” Even if the answer is no, the reasons might be illuminating. 

Do Your Homework, Then Set A Trap

Liars have a disadvantage. They don’t know how much of the truth you know. The more research you do, the more clever questions you can ask, and the more you can use a technique called “strategic use of evidence.”