12 - White Collar, Corporate, and Organized Crime Flashcards
White Collar Crime
crime committed by those within legitimate occupations or organizations.
EX. Martha Stewart (insider trading)
Organized crime
relatively structured hierarchical system, the goal of which is to provide consumers w/ goods for which there is a demand (including illegitimate so drugs, weapons, prostitution, some kinds of porn, gambling). Group crime w/ purpose of making money.
No demand = no org crime. Serving OUR interests and needs.
NOT an offence in Canada to belong to a criminal organization.
Corporate Crime
crime committed by one or more employees of a corporation w/ the aim of furthering the interests of the corporation.
Causes more deaths in a month than all the mass murders do in a decade.
EX. illegal / unsafe working conditions
Explained by Social organization / structure of work, corporate culture, capitalism.
Occupational Crime
Crimes committed by individuals for themselves in the course of rendering a service.
EX. Medicare fraud, misuse of client’s funds, substitution of inferior goods.
Employees may abuse authority for private gain - kickbacks, bribes, and favors. Believe organization can absorb loss.
Types of White-Collar Crime
- Investment related crimes
- Bankruptcy fraud
- Fraud against the government
- Consumer Fraud
- Insurance Fraud
- Tax Fraud
- Bribery, corruption, political fraud
- Insider-related fraud
Insider Trading
use of material, non-public, financial info to obtain an unfair advantage in trading securities
EX. Martha Stewart
Stock Manipulation
making misleading or even false statements to clients to give impression that price of the stock is about to rise, thus creating artificial demand for it.
EX. Bre-Ex Minerals LTD or DEFY Media
Bankruptcy Fraud
Any scam designed to take advantage of loopholes in the bankruptcy laws.
When bankruptcy petition is filed, the person or corporation’s property and financial obligations are disposed of.
Governmental Fraud
- Collusion in bidding (contractors inflate gov contract pay)
- payoffs and kickbacks to gov officials
- expenditures by gov officials that exceed the budget
- filing false claims
- hiring of friends
- offers of inducements to gov officials.
EX. Canada gov sponsorship scandal
Consumer Fraud
- Home improvement fraud
- deceptive advertising
- Telemarketing Fraud / phone scams
- Land fraud
- Business opportunity fraud (someone convincing you to invest fake opportunities)
Insurance Fraud
Filing of false claims for life, fire, marine, casualty or other insurance.
Tax Fraud
attempt to evade or defeat tax, non-payment of tax, or willful filing of a fraudulent tax return.
Bribery, corruption, political fraud
objective of such offences vary - favors, special privileges, services, business.
White Collar VS Corporate Crime
WCC = individuals / group committing for personal gain
Corporate = group to better company
Organizational Structure / Social Organization of Work
Pyramid structure (CEO -> boss -> workers) causes diffusion of responsibility. Positions of power carry freedom from control.
“Juristic Person” - law treats corporations as ‘juristic persons’ [liable to same laws as an actual person] which presents practical difficulties.
“Executive Disengagement” - lower level employees assume executives left uninformed (assume execs not legally expected to have complete control over staff).
Corporate Culture
Deviant and criminal behaviors may be encouraged (directly / indirectly).
Norms promoting ‘win at all costs’.
“Criminogenic market structure” - economic market structured in such way that tends to produce criminal behavior.
Capitalism (in corporate crime)
Competitive, tends to promote greed, selfishness and crime.
Costs of Corporate Crime
- Costs to consumers (price fixing, unsafe products [EX. Ford Pinto Case]).
- Costs to employees (illegal / unsafe work conditions).
- Costs to environment (immediate and long lasting).
General Characteristics of Organized Crime
- Conspiratorial activity
- Economic gain
- Connection to legitimate activity (i.e. laundering money)
- Predatory
Organized Crime Examples
- Italian Based Mafia: Reliance on ethnicity, family loyalty and a code of secrecy. Structured like a Sicilian Family. [EX Sicilian Mafia, ‘Ndrangheta, US branch of Cosa Nostra].
- Asian Based Groups: Cell system, Marijuana cultivation and exportation is common.
- Eastern European Groups: Influenced by shift fr communist to capitalist. Street level crime to fraud w/ technology. Actively involved in crimes of other organized crime groups.
- Indigenous Groups: Well-Established in prisons. Prison link used for recruitment and drug distribution. Linked to overrepresentation of Indigenous ppl in CJS.
- Outlaw Motorcycle Groups: Tightly knit, highly structured, violently control territory. EX. Hell’s angels (largest / most well established, 44 chpts in Can).
Money Laundering
Making illegally obtained funds seem legitimate so that they can be spent or invested in the legitimate economy w/ out arousing suspicion. Profits made through organized crime are ‘dirty money’ so money must be laundered.
