WCC midterm 1 Flashcards
Sutherland’s defintiion
a crime committed by a person of A) respectability and B) high social class in the course of his occupation
Sutherland’s critique
activities are not always related to occupation; there are other responsibilities at times with other groups and organizations; not always limited to high social class
Sutherland’s revised definition
a violation of a law (criminal, administrative, civil) committed by a person, group, or organization in the course of an otherwise respected and legitimate occupation or financial activity
what are the three types of WCC by kind of offender and give and example for each
high status (tax evasion) , occupational (academic dishonesty), and organizational (price fixing)
what are the types of WCC by kind of offenses
fraud and deception; ripping off company; bribery and corruption; manipulation of marketplace; violent WCC
name 3 lessons from hank shea
no one is above the law; when faced with an ethical dilemma, seek advice and counsel; no matter your position in the workplace, lead by example
3 kinds of “small” WCC
larceny (employee theft); embezzlement (appropriating someone else’s assets for their own personal use; violating intellectual property (pirating songs, movies, textbooks) or producing fake logos
Initiation vs. Institutionalization
Initiation is not always deviant while institutionalization is a matter of course practices
four types of crimes against consumers
false advertising; bait and switch; price fixing; bid rigging
what is bid rigging
when companies conspire to manipulate the outcome of a bidding process in their favor; raising prices or lowering the quality of goods/services for purchasers
what is price fixing
agreement between participants on the same side in a market to buy or sell a good/service only at a fixed price (controls the supply and demand)
what law criminalized price fixing
Sherman Antitrust Act of 1890
Heavy Electric Case
Westinghouse created an all-out price war; slashed prices on electrical products to below cost (also participated in bid rigging)
explanations of heavy electric case
“it was part of my duty” “illegal but not criminal” “performing a positive service to the economy by stabilizing prices”
types of fraud and deception
false advertising and consumer fraud
who is barry minkow and what did he do?
he started a business as a teen and ignored day-to-day cost controls resulting in him being heavily in debt at 17. he turned to insurance fraud and counterfeiting. he also resorted to credit card fraud by adding zeroes to customers’ bills; he created a pyramid scheme to build his business, but at the height of his career an LA times article collapsed his empire.
what are organizational actors (historically and now)
historically: corporate organizations tied to natural persons
now: corporations separate from individuals
what is an LLC
limited liability company that is a specific legal form of organization of persons and material resources, chartered by the state, for the purpose of conducting business
4 advantages of an LLC
1) limited liability 2) transferability of shares 3) judicial personality 4) indefinite duration
disadvantages of LLC’s
monopolies are created (ex: standard oil)
benefits of natural actors
freed from fixed estates and multidimensional
costs of natural actors
asymmetric society (much larger and many more alternative transaction partners; persons may be replaced more easily by other people or machines)
what are Sutherland’s theses
1) pathologies are not an adequate explanation of crime 2) upper-class crime is prevalent and the consequences are disastrous
what data did Sutherland focus on
out of the 70 largest corporations that were studied; he studied how many offenses, who they were decided by, and the timing
what data did Clinard and Yeagar find
repeat industries: oil, pharmaceutical, and auto industries
repeat offenses: environmental, labor, manufactoring
what are the 2 causes of WCC
1) motivation and 2) opportunities (by industries, by organizations, by occupations)
neutralization techniques
“just borrowing” “no one harmed” “law unjust, unreasonable” “necessary for survival” “everybody does it”
ENRON: Who
Ken Lay and Jeff Skilling
ENRON: What
gas and energy corporation; largest case of bankruptcy
ENRON: Crimes
- created loopholes to make abnormal profits (ex: exported power back and forth from CA)
- inflated company’s revenues and hid debt (ex: bonuses calculated by imaginary profits)
- wire fraud; money laundering; securities fraud; mail fraud; conspiracy
ENRON: How
- deregulated electricity in CA
- used traders to initiate rolling blackouts to generate revenue
- used mark-to-market accounting to book future profits the day a deal was made
ENRON: victims
- Californians
- economy
- workers who lost their jobs at Enron
- shareholders
problem of overly large corporations
consumers don’t know the cost of their purchases has increased due to illegal, anticompetitive practices
regulatory agencies examples
FTC, FDA, EPA
