How a True Expert Found His Passion - Interview with Jeffrey Harfenist

One of the most important and often most difficult steps in the process of becoming a true rain-maker is to find that area about which you are deeply passionate. One of the most prominent rain-makers in UHY Advisors FLVS, Inc. is Jeffrey Harfenist, the National Practice Leader for the Fraud & Forensics Practice and a extensively published expert on Foreign Corrupt Practices Act and international fraud investigations.

This is his story.

How did your practice begin?
When I started thirty years ago there was no such thing as litigation support in the practice of public accounting. I had my CPA and was an auditor. I knew that was not the challenge I was looking for in my career.

Early on an attorney I knew called me regarding a few cases he had. He wanted help with the financial side to them. We talked and I helped him. Eventually he needed an expert to testify in court on these issues and he hired me. When I landed that very first case I was hooked.

I immediately found that being a litigation damages expert and then working with attorneys on other financial issues involved in their cases or transactions was, and is, intellectually challenging and gives you a great deal of variety.

What characteristics must you have to work in this field?
You have to be fearless – you will be put into situations and asked to analyze things that you may at times not be comfortable with. You have to believe in yourself and do the hard work to get it right and then you must be able to present it in a way that the attorneys, their clients and most importantly, juries, can understand.

It is important, therefore, to know your weaknesses. We all like to do what we are good at, but it is perhaps more important to know what you are not good at. You then have to take the steps to correct that, do the research, practice, ask experts in the area, and whatever it takes to overcome that weakness.

You must be an excellent communicator – both in terms of the written and spoken word. When I was younger I took creative writing classes to help me write more effectively. As an accountant that was not part of the curriculum in college. My target clients, attorneys, are masters of the word so to play in their space I had to learn to write properly and write well.

Speaking. Peoples’ greatest fear is speaking in front of people. It is rated higher than death and cancer. If you are going to practice in this area you simply cannot fear this. You must speak in front of attorneys in depositions and in a courtroom and be able to handle harsh cross-examinations. If you cannot speak clearly in that venue and articulate your points in a way that the non-experts in the jury can understand, you cannot build this practice.

You also build your business by doing public speaking. The potential client in the audience is not only looking at the quality of the material you present, but also at how you are presenting it. Is your presentation knowledgeable and comprehensive yet understandable for the level of the audience? I recommend that young professionals speak as often as possible. I joined Toastmasters where I was forced to speak on rather random topics at a moments notice. This really helped me develop the ability to think clearly on my feet and then present in a cogent manner.

How did you build your business?
Networking, networking, networking.
Once I figured out what I wanted to do, I got out of the office and met a great many attorneys. I built relationships. I listened and cared and followed through for those I met. I used my connections to meet other attorneys. I attended Bar Assn events and secured as many opportunities to present in the CLEs they offered as I could land. I spoke on anything related to accounting and the law.

I believe you have to develop an advocate in each firm. A person who wants you to succeed and is willing to introduce you within the firm and more than that, promote you within the firm. Early in my career I found a person like that in an insurance defense firm. He introduced me around and I started getting small cases where there were lost profits in an auto accident case, for examples, because the injured person owned a business and because of his injuries could not operate it. Tremendous experience for me as a young expert.

My advocate introduced me to others in other firms. I developed more advocates in those firms who introduced me to others. This took many years. I now have several hundred contacts in my network, but I would count only around a dozen as true champions for me. They are all carefully-chosen, cultivated through reciprocity by me in any way I could. They have served me well and I hope I have done the same for them. Start with one person you trust, who trusts you and has at least some influence in his or her firm and build from there.

Your job as an expert witness is not to advocate for the client. That is the attorney’s job. Your job is to take complex financial issues based on the facts that you know, often inserted into economic models, and try to educate a jury as to what they actually mean in relation do this case, which is hard enough. Do not rely on representations from an attorney that you cannot verify are facts. I sat in on a deposition a while back of an expert who relied on representations that her attorneys had provided her. She obviously had not reviewed the facts and the documents. She was destroyed.

When I was just getting started I learned this and other things, the hard way. I was being deposed by a veteran attorney. I was filleted every way possible. I was not quite as prepared as I should have been. I talked too much. I tried to impress him with my brilliance. He spoke softly and guided me into trap after trap after trap. I learned a great deal that day.

As you choose who your clients will be, make very good decisions. Your advocates can be a great help in this regard. Make sure clients have integrity and do things the right way. Have a healthy skepticism. It takes a long time to develop a reputation and only an instance to destroy it.

How did you find that your passion was fraud and anti-corruption investigations?
My path into this profession was somewhat opportunistic and somewhat by design. I reached a point in my career where I no longer found the expert witness work to be stimulating. I wanted something new. Prior to joining UHY Advisors FLVS I had an opportunity to investigate a fraudulent insurance agent. It was a fairly simple but ingenious plot. During that experience, in the late 1980s, I discovered that this was incredibly fascinating. It was many years after that before I got the opportunity to do that again. Early in this decade, UHY Advisors was hired to perform the international investigation of TYCO. I was put in charge of a major portion of the work and that got me started and I have never looked back.

Fraud and corruption investigations are a marriage of everything we know as accountants combined with the study of human nature. What makes someone cross over that line? We are presented every day with opportunities to make bad decisions, but 99% of us never take that fateful step. What causes that 1% to make really bad decisions?

It was stunning in TYCO that someone making $40 million in legitimate annual pay decided to steal from the government and the company. The case began because the CEO refused to pay sales taxes on some paintings he purchased in a public auction. It then mushroomed into one of the largest international fraud investigations in history.

Fraud is solving a puzzle times twenty with human nature injected into the equation and I love it. I love to figure out the puzzle. The more complex the better. I love taking seemingly disparate bits of information and figuring it out so that it all coalesces into an “Ah-hah moment” where you realize “that’s how they did it.” Then you dig and dig until you uncover the entire trail.

You are a renowned expert in Foreign Corrupt Practices Act investigations. How did you get into that line of work?
Four years ago go, through networking connections and quality work for a firm I got my first shot at an FCPA case. I had done TYCO and other international fraud cases, so the FCPA investigation was a logical next step and that was just heating up at that time. International anti-corruption and fraud cases have all the challenges of the typical fraud or embezzlement case with an international flavor. I love to travel. Added to the traditional human component is local culture and tradition. Corruption has been the way business has been done in most countries for centuries. The puzzles were even more complex. Who are the people and how are they going to accomplish things under the environment they work in?

I have been doing this 30 years. When I look back I think about the experiences I had early on that I thought were a waste of my time. Every one ended up allowing me to develop a very beneficial skill set that I have reached back on. These early exercises build the arsenal of tools that you have in your toolbox to use as the next thing comes along.

How did you become an expert, world class practitioner?
As I mentioned, I spoke anywhere and everywhere on any topic to develop public speaking skills. I went down to the Houston Bar events and spoke as often as possible. Most do not listen, but the key is to speak. Speaking so often made me very comfortable in front of people. I love it now. I consider it a great challenge to convey complex concepts to “ordinary” people. I practiced for hours. I tried to anticipate the questions the audience would ask.

I am a voracious reader. I subscribe to every business publication there is. I read them in depth. This area changes constantly. You have to see the future and be able to re-invent yourself to be able to manage change. The basic skill sets do not change much – managing an investigation is the same no matter what investigation you are running – but you have to understand what needs to be investigated.

I write lots of articles and get them published in prominent Journals all around the world. You have to get your name out there as an expert and then once you get an opportunity, you have to prove that you really know what you are doing.

Provide world class service. You have to not only perform technically but you have to provide phenomenal customer service so that they come back to you and recommend you to their colleagues and peers. The client is going on faith when they hire you. Speaking a lot and writing a lot helps to give you the shot. Delivering the goods at 110% allows you to get future work.

How critical is it to be passionate about what you do?
There is no way I could be where I am without the passion I feel for the work. You can be good for a sprint, I suppose like I was in damages testimony. To win the marathon you have to be relentless and the only way you can be relentless is to truly love what you are doing.

A few years ago I spoke at a webinar with a prominent Washington DC anti-corruption attorney. I stayed after him for years. I never heard any response from him. Not one word. A couple of weeks ago an associate at the firm contacted me. I mentioned that I had spoken with the attorney several years prior, and the associate told me that it was that attorney who had instructed him to call me. Three years later an opportunity finally came of my effort.

Passion gives you the ability to stay persistent.

How Important are Credentials?
They are more important now than they were when I started, but they will not make you. You hope that having the right ones will help you avoid being disqualified before you even get a chance. If they have three options and the other two have all the” important” credentials and you do not, you may not even get in the game. Some credentials, of course, hold more weight than others.

I am a CPA and an MBA. I will never know, though, how many opportunities I did not get because I did not have some other credentials. Choose those credentials that have true gravitas.

What advice can you give younger professionals about Networking?
Find things you like and join an organization on that topic. If you like photography, join a photography club. There will be potential clients in that club and you will have something in common and can build relationships that way.

Our game is a numbers game. You have to meet a lot of people. The more people you know the higher the likelihood that someone will need you.
The Texas Bar is critical. Go to Bar events.
Join charities. Lawyers sit on charitable boards.
Call attorneys and go to lunch.

Practice your pitch. The more you practice it the more easily it will flow when you find yourself sitting on a plane next to a potential client.

Becoming a rain-maker is not rocket science. It is hard work and dedication. That being said, you simply cannot get there without first finding your passion. You will not do what is required of you long enough if you do not find your true and deep passions. Take your time. You will need it.

Thank you Jeffrey for your time.