Cognitive heuristics and risk evaluation in crisis fraud

Abstract

Purpose: The recent COVID-19 crisis has been followed by an epidemic of fraud. This study aims to evaluate cases of COVID-19-related fraud to identify cognitive heuristics that influence decision-making under the pressure of crisis conditions. Design/methodology/approach: An analysis of fraud advisories and cases relating to COVID-19 is conducted and matched against various types of cognitive heuristics to explain their influence on victims of crisis fraud. Findings: The affect, availability, cue-familiarity, representativeness and scarcity heuristics are identified and explained to have a substantial influence on risk evaluations of crisis fraud. Originality/value: The findings from this study can help individuals avoid fraud victimisation by helping them understand psychological vulnerabilities that they may be unaware of under the pressure of crisis conditions.