How to Handle the Lying Client

Have you ever completed a telephone conversation or meeting with a prospect or client and had the suspicion that he hadn’t been completely truthful? As an agent, you have probably become accustomed to hearing bogus excuses from prospective clients who simply don’t want to meet with you. Such simple “white lies” are an unfortunate fact of business life. However, clients who actively misrepresent material facts can pose a serious threat to your business. If they are willing to do so, lying clients may be willing to fabricate or falsify a claim against you for their own benefit.

How you respond to such a situation depends in large measure upon how serious you believe the lie to be. A “white lie” is relatively easy to deal with, but a serious and material falsehood is a clear sign of a potentially more sinister character flaw. You will need to consider whether continuing to deal with that client is worth the risk to your business and your E&O coverage.

When a client lies to you:

  • Don’t automatically assume the client is intentionally lying.
  • ¬†Advise your client that it is in the best interests of both you and he to be completely truthful, and request a clarification.
  • If the client admits the lie, allow him to tell the truth. If he persists in the lie you will need to seriously consider whether he should continue to be a customer.
  • Never go along with a lying client – your acceptance and use of materially information which you know or suspect to be false is very likely to result in serious negative legal repercussions.

As a businessman your good reputation for honesty and integrity is a primary selling tool and should never be risked.

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