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Date: April 30, 2024 Tue
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Results for corporate crime
34 results foundAuthor: U.S. Government Accountability Office Title: Corporate Crime: DOJ Has Taken Steps to Better Track Its Use of Deferred and Non-Prosecution Agreements, but Should Evaluate Effectiveness Summary: Recent cases of corporate fraud and mismanagement heighten the Department of Justice’s (DOJ) need to appropriately punish and deter corporate crime. Recently, DOJ has made more use of deferred prosecution and non-prosecution agreements (DPAs and NPAs), in which prosecutors may require company reform, among other things, in exchange for deferring prosecution. In June and November 2009, GAO testified on DOJ’s use and oversight of DPAs and NPAs, and this report discusses additional findings, including (1) the extent to which DOJ has used DPAs and NPAs to address corporate misconduct and tracks use of these agreements, (2) the extent to which DOJ measures the effectiveness of DPAs and NPAs, and (3) the role of the court in the DPA and NPA process. GAO examined 152 DPAs and NPAs negotiated from 1993 through September 2009 and analyzed DOJ data on corporate prosecutions in fiscal years 2004 through 2009. GAO also interviewed DOJ officials, prosecutors from 13 DOJ offices, 20 company representatives, 11 monitors who oversee company compliance, and 12 federal judges. While not generalizable, these results provide insight into decisions about DPAs and NPAs. GAO recommends that DOJ develop performance measures to assess the effectiveness of DPAs and NPAs. DOJ agreed with our recommendation. Details: Washington, DC: U.S. Government Accountability Office, 2009. 47p. Source: Internet Resource: Accessed August 22, 2010 at: http://www.gao.gov/new.items/d10110.pdf Year: 2009 Country: United States URL: http://www.gao.gov/new.items/d10110.pdf Shelf Number: 119649 Keywords: Commercial CrimesCorporate CrimeFraudProsecution |
Author: KPMG Title: Fraud and Misconduct Survey 2010: Australia and New Zealand Summary: KPMG's ninth biennial Fraud and Misconduct Survey 2010, Australia and New Zealand looks into the extent and nature of fraud in the public and private sector – how much was stolen, who stole it, how they stole it and how to prevent them stealing it again. Key findings include the following: The total cost of fraud is increasing: $345.4 million was lost to fraud compared to $301.1 million two years ago. Yet respondents believed that only a third of total losses are being detected. We could be looking at the tip of an iceberg; The value per fraud is increasing: The number of separate frauds reported fell when compared with the 2008 survey, yet the average fraud rose from $1.5 million in 2008 to $3 million in 2010; Who did it: 65 percent of major frauds are committed by people already working in the organisation who usually act alone. The main motivator for fraud was greed and lifestyle. Details: Sydney(?): KPMG, 2010. 43p. Source: Internet Resource: Accessed December 6, 2010 at: http://www.kpmg.com/AU/en/IssuesAndInsights/ArticlesPublications/Fraud-Survey/Documents/Fraud-and-Misconduct-Survey-2010.pdf Year: 2010 Country: Australia URL: http://www.kpmg.com/AU/en/IssuesAndInsights/ArticlesPublications/Fraud-Survey/Documents/Fraud-and-Misconduct-Survey-2010.pdf Shelf Number: 120388 Keywords: Corporate CrimeCorruptionFraud (Australia and New Zealand) |
Author: Amunwa, Ben Title: Counting the Cost: Corporations and Human Rights Abuses in the Niger Delta Summary: This report examines the role of Shell in human rights abuses committed by Nigerian government forces and other armed groups between 2000 and 2010. It provides eight case studies, places them in wider social and environmental context and evaluates the level of legal, reputational and operational risk the company faces. Each case illustrates different but related ways that Shell’s conduct has led to repression and conflict. All eight cases are from the ‘eastern division’ of Shell’s operations in the Niger Delta, where the company first struck oil in commercial quantities in 1956. As the largest operator in the Delta, Shell is the focus of this report. But the issues, conclusions and recommendations apply to other oil companies operating in the region. The past decade in the Delta has brought brutal government crackdowns, the rise of armed groups and a multiplicity of intense conflicts. While primary responsibility for human rights violations falls on the Nigerian government and other perpetrators, Shell has played an active role in fuelling conflict and violence in a variety of forms. This report finds that: Shell’s close relationship with the Nigerian military exposes the company to charges of complicity in the systematic killing and torture of local residents. Testimony and contracts seen by Platform implicate Shell in regularly assisting armed militants with lucrative payments. In one case from 2010, Shell is alleged to have transferred over $159,000 to a group credibly linked to militia violence. Shell’s poor community engagement has provided the “catalyst” for major disruption, including one incident that shut down a third of Shell’s daily oil production in August 2011. In the absence of proper supervision and controls, Shell contractors, including multinationals like Halliburton, Daewoo and Saipem, have replicated many of Shell’s mistakes. Shell’s conduct in the Delta has local and global implications. Basic company errors have exacerbated violent conflicts in which entire communities have been destroyed. Billions have been lost in revenues to the government and oil companies, sending shockwaves through the global economy. These are not new phenomena. In 2003, a leaked internal report denounced Shell for its active involvement in the Delta conflict. Then, as now, Shell pledged to improve. But Platform’s report finds that Shell has not taken the necessary steps to de-militarise its operations in the Delta, resolve longstanding grievances and respect the human rights of local communities. The eight cases in this report are the thin end of the wedge. Many further cases of human rights abuse are associated with Shell’s operations in the western, central and outer Delta regions, as well as with Chevron, Eni and other oil companies and private military and security contractors (PMSCs). Given the widespread and systematic nature of the problem, this report aims to provide a cross-section, not a comprehensive overview. Platform believes there are many ways to address this urgent issue and at the end of this report puts forward key recommendations to the Nigerian authorities, Shell, shareholder investors and the UK, US and Dutch governments. Details: London: Platform, 2011. 76p. Source: Internet Resource: Accessed October 18, 2011 at: http://platformlondon.org/nigeria/Counting_the_Cost.pdf Year: 2011 Country: Nigeria URL: http://platformlondon.org/nigeria/Counting_the_Cost.pdf Shelf Number: 123042 Keywords: Corporate CrimeHuman Rights Abuses (Nigeria)Violence |
Author: Travers, Harry, ed. Title: Serious Economic Crime: A boardroom guide to prevention and compliance Summary: In many ways this publication, with its contributions from both the public and private sector, and from a wide variety of expert sources, is emblematic of this new approach. Part I features chapters from a number of regulators and key bodies. The Financial Services Authority (FSA) describes the role it plays in prosecuting market abuse and insider dealing, while the chapter by the City of London Police highlights what can be achieved by domestic prosecution agencies working in partnership with equivalent agencies on a global scale. The Organisation for Economic Co-operation and Development (OECD) expands on the benefits of international co-operation, following closely the pioneering Oslo conference that brought governments, non-governmental organisations and business together in the fight against financial crime, while the World Bank outlines the historic 2010 agreement between multilateral development banks to adopt common definitions of fraud and due process and, crucially, to recognise and enforce debarment decisions of the other signatories. The chapter by Transparency International brings global perspectives on counter-corruption measures, and in a separate chapter the World Bank outlines its anti-corruption agenda. We hear also from the European Anti-Fraud Office (OLAF) on the European Union approach to combating money laundering, while the Society of Corporate Compliance and Ethics introduces non-regulatory compliance solutions. Details: London: White Page Ltd, 2011. 312p. Source: White Paper: Internet Resource: Accessed on January 27, 2012 at http://www.seriouseconomiccrime.com/ebooks/Serious-Economic-Crime.pdf Year: 2011 Country: United States URL: http://www.seriouseconomiccrime.com/ebooks/Serious-Economic-Crime.pdf Shelf Number: 123833 Keywords: Business CommunityBusinesses and CrimeCorporate CrimeCriminal InvestigationsEconomic CrimeProsecution |
Author: Markoff, Gabriel H. Title: Arthur Andersen and the Myth of the Corporate Death Penalty: Corporate Criminal Convictions in the Twenty-First Century Summary: The conventional wisdom states that prosecuting corporations can subject them to terrible collateral consequences that risk putting them out of business and causing massive social and economic harm. Under this viewpoint, which has come to dominate the literature following the demise of Arthur Andersen after that firm’s prosecution in the wake of the Enron scandal, even a criminal indictment can be a “corporate death penalty.” The Department of Justice (“DOJ”) has implicitly accepted this view by declining to prosecute many large companies in favor of using criminal settlements called deferred prosecution agreements, or “DPAs.” Yet, there is no evidence to support the existence of the “Andersen Effect” and the much-hyped corporate death penalty. Indeed, no one has ever empirically studied what happens to companies after conviction. In this Article, I do just that. Using the database of organizational convictions made publicly available by Professor Brandon Garrett, I find that no publicly traded company failed because of a conviction in the years 2001–2010. Moreover, many convictions included plea agreements imposing compliance programs that advocates have pointed to as a key justification for using DPAs. Because corporate convictions do not have the terrible consequences they were assumed to have, and because they can be used to obtain compliance programs just as DPAs can, the DOJ should prosecute more lawbreaking companies and reserve DPAs for extraordinary circumstances. In the absence of some other justification for using DPAs, the DOJ should exploit the stronger deterrent value of corporate prosecution to its full capacity. Details: Social Science Research Network, 2012. 47p. Source: Working Paper: Internet Resource: Accessed September 13, 2012 at https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID2143925_code1710157.pdf?abstractid=2132242&mirid=1 Year: 2012 Country: United States URL: https://papers.ssrn.com/sol3/Delivery.cfm/SSRN_ID2143925_code1710157.pdf?abstractid=2132242&mirid=1 Shelf Number: 126343 Keywords: ConvictionsCorporate CrimeCorporate Death PenaltyProsecutionWhite-Collar Crime |
Author: Almashat, Sammy Title: Pharmaceutical Industry Criminal and Civil Penalties: An Update Summary: In December 2010, Public Citizen published a report that, for the first time, documented all major financial settlements and court judgments between pharmaceutical manufacturers and the federal and state governments since 1991. At the time of the report’s publication, almost $20 billion had been paid out by the pharmaceutical industry to settle allegations of numerous violations, including illegal, off-label marketing and the deliberate overcharging of taxpayer-funded health programs, such as Medicare and Medicaid. Three-fourths of the settlements and accompanying financial penalties had occurred in just the five-year period prior to 2010. At the time of the report’s publication, there was no indication that this upward trend was subsiding. The following study was undertaken to assess the level of settlement activity from the previous report through the first half of 2012 – an additional 1 ½ years – and to conduct, for the first time, an analysis of the results of individual state enforcement efforts since 1991. Methodology from the 2010 report was largely replicated, with all federal and state government settlements, of $1 million or greater, reached with pharmaceutical manufacturers from November 2, 2010 through July 18, 2012 included in the current study. In addition, a 50-state analysis of settlement activity, going back to 1991, was conducted for the first time on state settlements that did not involve the federal government. State settlements were classified as single-state settlements (those in which only one state was a party to the final settlement) or multi-state settlements (all other state settlements). A total of 74 additional settlements, totaling $10.2 billion in financial penalties, were reached between the federal and state governments and pharmaceutical manufacturers between November 2, 2010 and July 18, 2012, with the first half of 2012 alone already representing a record year for both federal ($5.0 billion) and state ($1.6 billion) financial recoveries. Since 1991, a total of 239 settlements, for $30.2 billion, have now been reached (through July 18, 2012) between federal and state governments and pharmaceutical companies. Other key findings included: - Single-state settlements have been responsible for most of the recent increase in settlement activity, comprising almost three-fifths (59%) of all settlements since the beginning of 2009, compared to only one-fourth (25%) of settlements prior to 2009. - Since 1991, 27 states have reached at least one single-state settlement with a pharmaceutical company. Kentucky has had the most single-state settlements (17) while Texas has had the highest number of single-state settlements resulting from actions initiated by private whistleblowers (6). - Seventeen of the 27 states with at least one single-state settlement since 1991 have attained a return on investment of $1 or greater for every dollar spent on enforcement of all (both pharmaceutical-related and non-pharmaceutical) Medicaid fraud. - Since 2009, the federal government has concluded almost as many settlements and recovered more in financial penalties as it had in the previous 18 years combined. - Whistleblower-initiated investigations were responsible for most federal settlements (75%) and financial penalties (78%) during the current study period. - As in the previous study, overcharging government health insurance programs, mainly drug pricing fraud against state Medicaid programs, was the most common violation, while the unlawful promotion of drugs was associated with the largest penalties. The past two years have seen a continuation of the recent trend of record settlements between the federal and state governments and pharmaceutical manufacturers. A much larger proportion of these recent settlements have been brought about by individual state investigations than in previous years which, in most states involved in such litigation, has resulted in financial recoveries that more than offset enforcement expenses. However, despite the scale of the fraud against their Medicaid programs and the potential recoveries at stake, most states, including some with the highest prescription drug expenditures, have yet to pursue investigations on their own. On a federal level, financial penalties still continue to pale in comparison to company profits and a parent company is only rarely excluded from participation in Medicare and Medicaid for the illegal activities, which endanger the public health and deplete already overstretched taxpayer-funded programs. In what will hopefully represent an emerging trend, the federal government has recently pursued criminal charges against key company employees and executives, but the cases so far have either been thrown out or resulted in minor sentences. Stronger legislation and more robust enforcement are needed on a federal and state level to deter future unlawful behavior. Details: Washington, DC: Public Citizen, 2012. 50p. Source: Internet Resource: Accessed October 3, 2012 at: http://www.citizen.org/documents/2073.pdf Year: 2012 Country: United States URL: http://www.citizen.org/documents/2073.pdf Shelf Number: 126544 Keywords: Corporate CrimeFraud and CorruptionMedicaid FraudPrescription FraudWhistleblowersWhite Collar Crime, Pharmaceutical Industry |
Author: Randazzo, Marisa Reddy Title: Insider Threat Study: Illicit Cyber Activity in the Banking and Finance Sector Summary: Current and former employees, contractors, and other organizational “insiders” pose a substantial threat by virtue of their knowledge of and access to their employers’ systems and/or databases and their ability to bypass existing physical and electronic security measures through legitimate means. Previous efforts to study insider incidents have focused on convenience samples and narrow areas of industry and have not examined the incidents from both behavioral and technical perspectives simultaneously. These gaps in the literature have made it difficult for organizations to develop a comprehensive understanding of the insider threat and address the issue from an approach that draws on human resources, corporate security, and information security perspectives. The Secret Service National Threat Assessment Center and the CERT Coordination Center of Carnegie Mellon University’s Software Engineering Institute joined efforts to conduct a unique study of insider incidents, the Insider Threat Study (ITS), examining actual cases identified through public reporting or as a computer fraud case investigated by the Secret Service. Each case was analyzed from a behavioral and a technical perspective to identify behaviors and communications in which the insiders engaged—both online and offline—prior to and including the insiders’ harmful activities. Section 1 of this report presents an overview of the ITS, including its background, scope, and study methods. Section 2 reports the findings and implications specific to research conducted on insider threat cases in the banking and finance sector. Details: Pittsburgh, PA: Carnegie Mellon University, Software Engineering Institute, 2005. 36p. Source: Internet Resource: Accessed October 7, 2012 at http://www.sei.cmu.edu/reports/04tr021.pdf Year: 2005 Country: United States URL: http://www.sei.cmu.edu/reports/04tr021.pdf Shelf Number: 126569 Keywords: Corporate CrimeCybercrimeFinancial FraudInsider ThreatsRisk Management |
Author: Stewart, James G. Title: A Pragmatic Critique of Corporate Criminal Theory: Atrocity, Commerce and Accountability Summary: Corporate criminal liability is a controversial beast. To a large extent, the controversies surround three core questions: first, whether there is a basic conceptual justification for using a system of criminal justice constructed for individuals against inanimate entities like corporations; second, what value corporate criminal liability could have given coexistent possibilities of civil redress against them; and third, whether corporate criminal liability has any added value over and above individual criminal responsibility of corporate officers. In this paper, I use examples from the frontiers of international criminal justice to criticize all sides of these debates. In particular, I harness the latent possibility of prosecuting corporate actors for the pillage of natural resources and for complicity through the supply of weapons, to highlight the shortcomings of corporate criminal theory to date. Throughout, I draw on principles derived from philosophical and legal pragmatism to reveal a set of recurring analytical flaws in this literature. These include: a tendency to presuppose a perfect single jurisdiction that overlooks globalization, the blind projection of local theories of corporate criminal responsibility onto global corporate practices; and a perspective that sometimes seems insensitive to the plight of the many who have fallen victim to corporate crime in the developing world. To begin anew, we need to embrace a pragmatic theory of corporate criminal liability that is forced upon us in a world as complex, unequal, and dysfunctional as that we presently inhabit. Details: Vancouver, British Columbia: UBC Faculty of Law, 2012. 38p. Source: Internet Resource: Accessed October 15, 2012 at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2152682 Year: 2012 Country: United States URL: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2152682 Shelf Number: 126742 Keywords: Corporate CrimeDestruction and PillageOffenses Against the EnvironmentProsecutionTheft of Natural Resources |
Author: Connor, John M. Title: Problems with Prison in International Cartel Cases Summary: Around the year 2000, the Antitrust Division announced a new policy that would substitute more frequent and more severe prison sentences for heavier corporate fines in criminal cartel cases. This article documents that the Division has indeed imprisoned more cartel managers and obtained longer sentences, but has failed to achieve other goals. The elimination of no-jail plea deals has not been realized; the number of imprisoned executives per firm has not risen appreciably; adoption of criminalization by other jurisdictions is glacial; almost half of those executive who go to trial are acquitted; extradition is rare and problematic; and the number of fugitives is growing. Identifying the optimal mix of corporate and individual sanctions for deterrence remains elusive. Details: West Lafayette, IN: Purdue University, 2012. 45p. Source: Internet Resource: Accessed December 17, 2012 at http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2166414 Year: 2012 Country: International URL: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2166414 Shelf Number: 127233 Keywords: Business CartelsCorporate CrimePrisonsSentencing |
Author: Kar, Dev Title: Illicit Financial Flows from China and the Role of Trade Misinvoicing Summary: The Chinese economy hemorrhaged US$3.79 trillion in illicit financial outflows from 2000 through 2011, according to a new report [PDF] released today by Global Financial Integrity (GFI), a Washington, DC-based research and advocacy organization. Amidst increased domestic concern over inequality and corruption, GFI’s study raises serious questions about the stability of the Chinese economy merely two weeks before the once-in-a-decade leadership transition. The research, conducted by GFI Lead Economist Dev Kar and GFI Economist Sarah Freitas, found that the illegal outflows—the proceeds of crime, corruption, and tax evasion—were largely due to a trade-based money laundering technique known as ‘trade misinvoicing ,’ which accounted for US$3.2 trillion, or 86.2%, of the total outflow of illegal capital over the 11 years studied. The trade misinvoicing figures were provided exclusively to The Economist, and appear in the latest edition of the magazine which hits newsstands tomorrow. Details: Washington, DC: Global Financial Integrity, 2012. 26p. Source: Internet Resource: Accessed December 17, 2012 at http://www.gfintegrity.org/storage/gfip/documents/reports/ChinaOct2012/gfi-china-oct2012-report-web.pdf Year: 2012 Country: International URL: http://www.gfintegrity.org/storage/gfip/documents/reports/ChinaOct2012/gfi-china-oct2012-report-web.pdf Shelf Number: 127237 Keywords: Corporate CrimeCorrupt Practices Financial Crimes Illicit Financial Flows Money Laundering Tax Evasion |
Author: Keenan, Peter Title: Convictions for Summary Insolvency Offences Committed by Company Directors Summary: The Australian Securities and Investments Commission (ASIC) investigates and prosecutes certain strict liability criminal offences by directors before local and Magistrates’ courts across Australia. Until December 2011, ASIC made public the details of each successful case by periodically releasing conviction reports on its website and through media releases. In this paper, an analysis of the raw information in ASIC conviction reports for the five calendar years 2006 to 2010 is presented to provide statistical data on convictions and fines obtained by ASIC under its court-based enforcement activities, with an emphasis on insolvency offences. The analysis reveals that under its summary prosecution program, ASIC’s focus turned almost exclusively to insolvency crimes committed by directors of collapsed, insolvent companies, where they have failed to assist liquidators. The analysis reveals a trend toward fewer convictions (except in New South Wales) and smaller fines for these ‘fail-to-assist’ offences between 2006 and 2010. This paper also provides background information about the traditional role played by insolvency practitioners in detecting corporate crime and assisting with prosecution, as well as the character and significance of summary insolvency offences. It suggests that prosecution of these summary insolvency offences may be important to the integrity of Australia’s regime of corporate insolvency law. By arrangement with the Commonwealth Director of Public Prosecutions, ASIC is permitted to conduct its own prosecutions of what the Commonwealth Director of Public Prosecutions describes as minor regulatory offences against the Corporations Act 2001 (Cth) (the Act). Under this arrangement, ASIC commenced an expanded summary prosecutions program in 2002 and as part of this, received special funding for a Liquidator Assistance Program. ASIC’s first report on the outcomes of these initiatives showed that most of the convictions achieved between 2002 and 2005 were in respect of offences relating to failure by company officers to assist insolvency practitioners (ASIC 2005). Analysis of similar ASIC reports since 2005 reveals that convictions for such insolvency offences now predominate. Further, analysis of these reports shows a reduction in the average fine being imposed by the courts, a fall in the actual number of defendants convicted and offence rates varying between jurisdictions. The purpose of this scoping study is to analyse and document changes in the number of convictions achieved by ASIC for failure to assist-type insolvency offences identified during the liquidation process, to examine changes in the penalties awarded by the courts for such offences, to illuminate enforcement and prosecution action being taken in an area of white collar crime that is rarely discussed outside the insolvency industry and to point to the nature of the issues that should be examined through additional research. Details: Canberra: Australian Institute of Crimionology, 2013. 8p. Source: Internet Resource: Research in Practice Report no. 30: Accessed February 21, 2013 at: http://www.aic.gov.au/publications/current%20series/rip/21-40/rip30.html Year: 2013 Country: Australia URL: http://www.aic.gov.au/publications/current%20series/rip/21-40/rip30.html Shelf Number: 127688 Keywords: Corporate CrimeEconomic Crime (Australia)White Collar CrimeWhite Collar Offenses |
Author: Simpson, Sally S. Title: Corporate Crime Deterrence: A Systematic Review Summary: BACKGROUND Corporate crime is a poorly understood problem with little known about effective strategies to prevent and control it. Competing definitions of corporate crime affect how the phenomenon is studied and implications for reducing it. Therefore, in this review, we use John Braithwaite's definition (1984: 6) which specifies that corporate crime is "the conduct of a corporation, or of employees acting on behalf of a corporation, which is proscribed and punishable by law." Consistent with this approach, this review focuses on various legal strategies aimed at companies and their officials/managers to curtail corporate crime. Interventions may be punitive or cooperative, but the goal is to prevent offending and increase levels of corporate compliance. OBJECTIVES Our overall objective is to identify and synthesize published and unpublished studies on formal legal and administrative prevention and control strategiesi.e., the actions and programs of government law enforcement agencies, legislative bodies, and regulatory agencies on corporate crime. We then assess the impact of these strategies on individual and company offending. Included are legal and administrative interventions such as new laws or changes in laws, inspections by regulatory agencies, punitive sanctions and non-punitive interventions aimed at deterring or controlling illegal behaviors. CRITERIA FOR INCLUSION OF STUDIES We were highly inclusive in our selection criteria, including studies that encompass a wide variety of methodologies: experimental (e.g., lab studies or vignette surveys), quasi-experimental (e.g., pre/post-tests), and non-experimental (e.g., correlational statistics using secondary data). The studies included also contained a wide variety of data (e.g., data from official agencies, corporate reports, individuals' survey responses, etc.). Our search included published and unpublished articles, reports, documents, and other readily available sources. The outcome of interest, corporate offending, could reflect actual behavior or behavioral intentions as reported by respondents. Out of the 40 possible treatment categories, we were able to calculate a mean effect size for 19. Although most showed a positive albeit non-significant treatment effect, some (including a significant effect) were iatrogenic. Looking at the specific mechanisms, the impact of law on corporate crime showed a modest deterrent effect at the firm and geographical level of analysis (there was not enough data to calculate effect sizes for individuals). However, this finding is limited to cross-sectional studies. For punitive sanctions, where there was substantially more data from which to calculate effect sizes, we observe a similar pattern: A tendency toward deterrence across units of analysis, with relatively few significant effects regardless of whether data are cross-sectional or longitudinal. The one area where there appears to be a consistent treatment effect is in the area of regulatory policy, but only at the individual level. Effects for other levels are contradictory (with some positive and others iatrogenic) and none are statistically significant. Regarding moderator effects, the least methodologically rigorous designs those that were not experimental versus experimental designs and those without statistical control variables versus controls were associated with a treatment effect. We also found that older studies were associated with stronger deterrent effectsperhaps because the older studies are less methodologically rigorous that those that are newer. Other moderator results were less clear (publication bias, country bias, disciplinary bias; offense type), but given how few of the analyses revealed strong treatment effects overall we think it is premature to draw any conclusions from these findings and call instead for more methodologically rigorous and focused studies particularly in the punitive sanction and regulatory policy areas. Details: Oslo: Campbell Collaboration, 2014. 106p. Source: Internet Resource: Campbell Systematic Review 2014:4: Accessed May 5, 2014 at: http://www.campbellcollaboration.org/lib/project/199/ Year: 2014 Country: International URL: http://www.campbellcollaboration.org/lib/project/199/ Shelf Number: 132243 Keywords: Corporate CrimeCrime PreventionDeterrenceFinancial CrimeFraudWhite-Collar Crime |
Author: Schell-Busey, Natalie Marie Title: The Deterrent Effects of Ethics Codes for Corporate Crime: A Meta-Analysis Summary: The current financial crisis, brought on in part by the risky and unethical behaviors of investment banks, has drawn attention to corporate crime, particularly on the issue of how to prevent it. Over the last thirty years, codes of conduct have been a cornerstone of corporate crime prevention policies, and consequently are now widespread, especially among large companies. However, the empirical literature is mixed on the effectiveness of codes, leaving them open to critics who charge that codes can be costly to implement, ineffective, and even criminogenic. In this dissertation I use meta-analysis to examine the evidence regarding the preventative effects of ethics codes for corporate crime. The results show that codes and elements of their support system, like enforcement and top management support, have a positive, significant effect on ethical-decision making and behavior. Based on these results, I propose an integrated approach toward self-regulation founded on Braithwaite's (2002) enforcement pyramid, which specifies that regulation should primarily be built around persuasion with sanctions reserved for situations where a stronger deterrent is needed. Details: College Park, MD: University of Maryland, 2009. 164p. Source: Internet Resource: Dissertation: Accessed May 15, 2014 at: http://drum.lib.umd.edu/bitstream/1903/9289/1/SchellBusey_umd_0117E_10313.pdf Year: 2009 Country: United States URL: http://drum.lib.umd.edu/bitstream/1903/9289/1/SchellBusey_umd_0117E_10313.pdf Shelf Number: 132364 Keywords: Corporate CrimeEthicsFinancial CrimesWhite Collar CrimeWhite Collar Offenses |
Author: Baker, Raymond Title: Hiding in Plain Sight: Trade Misinvoicing and the Impact of Revenue Loss in Ghana, Kenya, Mozambique, Tanzania, and Uganda: 2002-2011 Summary: Illicit flows of capital through developing countries due to trade misinvoicing is one of the most pressing challenges facing policymakers in these countries. The global figure for illicit financial outflows from developing countries is approximately $542 billion per year on average (over a 10-year time series), and trade misinvoicing makes up close to 80 percent of this or $424 billion. Capital flight, facilitated by a global network of secrecy jurisdictions and complex, opaque corporate and account structures, robs governments and societies of needed revenue for domestic investment in the private sector, infrastructure development, and the provision of vital social services. This translates into lost opportunities, lost jobs, and lost potential. This study explores the economic and the policy side of the issue of trade misinvoicing using case studies of Ghana, Kenya, Mozambique, Tanzania, and Uganda. Data on illicit flows for these five countries demonstrate the varying magnitudes, sources, and consequences of trade misinvoicing at the country level and provide hope and warning to other developing countries. We find that trade misinvoicing is a significant source of illicit outflows and inflows of capital in each country, resulting in billions of dollars of lost investment and hundreds of millions of dollars in unrealized domestic resource mobilization. The sources of trade misinvoicing varied across the cases, as did the policy environment in which this misinvoicing occurs. However, we also find significant facets of this issue that apply to all the countries, particularly with regards to customs invoice review procedures and access to on-the-spot information. These challenges represent opportunities for the five countries to improve their economic systems and accountability mechanisms through greater transparency. Details: Washington, DC: Global Financial Integrity, 2014. 72p. Source: Internet Resource: Accessed June 26, 2014 at: http://www.gfintegrity.org/wp-content/uploads/2014/05/Hiding_In_Plain_Sight_Report-Final.pdf Year: 2014 Country: Africa URL: http://www.gfintegrity.org/wp-content/uploads/2014/05/Hiding_In_Plain_Sight_Report-Final.pdf Shelf Number: 132540 Keywords: Corporate CrimeCorrupt Practices Financial Crimes Illicit Financial Flows Money Laundering Tax Evasion |
Author: Cohen, Mark A. Title: Willingness to Pay to Reduce White Collar and Corporate Crime Summary: Consumer protection and financial regulatory agencies such as the Federal Trade Commission (FTC), the Securities and Exchange Commission (SEC), and the Consumer Financial Protection Bureau (CFPB) regulate various types of consumer, investor and financial frauds. Whether required or not, rulemaking proceedings oftentimes include some form of cost-benefit analysis. Thus, the benefits of proposed regulations - whether fully quantified or not - are an increasingly important component of rulemaking decisions. Anecdotal evidence suggests that the impact on victims in some cases include significant time and financial hardships and even pain, suffering and reduced quality of life. Further, the existence of these offenses causes non-victims to take costly precautionary behavior and might even inhibit legitimate business activities. Yet, little is known about the true costs of consumer and financial crimes other than the out-of-pocket monetary losses incurred by victims. To the extent society wishes to optimally deter such crimes, without better data on nonmonetary costs, any cost-benefit analyses of criminal justice or prevention programs designed to reduce these crimes will inevitably underestimate program benefits. This paper provides an initial framework and empirical estimates of the willingness-to-pay to reduce four types of white collar and corporate offenses - consumer fraud, financial fraud, corporate crime and corporate financial crime. Utilizing a contingent valuation survey approached that has been used to estimate the cost of street crimes, the average willingness to pay for a 10% reduction in each of these four offenses is estimated to range between $70 and $75 per household. In the case of consumer fraud and financial fraud - where estimates of prevalence are available, this translates into a willingness to pay of $2,700 per consumer fraud and $21,000 for financial fraud. In contrast, the out-of-pocket costs to victims of consumer fraud have been estimated to average about $100, and about $200 to $250 for various types of financial frauds. These figures also compare favorably to the willingness to pay for a reduced household burglary of $18,000. Details: Nashville, TN: Vanderbilt University, 2014. 27p. Source: Internet Resource: Vanderbilt University - Owen Graduate School of Management; Vanderbilt University - Law School; Resources for the Future: Accessed September 12, 2014 at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2486220 Year: 2014 Country: United States URL: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2486220 Shelf Number: 133299 Keywords: Consumer Fraud (U.S.)Consumer ProtectionCorporate CrimeFinancial CrimesFinancial FraudWhite-Collar Crime |
Author: Wolfe, Simon Title: Whistleblower Protection Laws in G20 Countries: Priorities for Action Summary: Background The G20 countries committed in 2010 and 2012 to put in place adequate measures to protect whistleblowers, and to provide them with safe, reliable avenues to report fraud, corruption and other wrongdoing. While much has been achieved as a result of the G20 commitment, on the whole much remains to be done to meet this important goal. Many G20 countries' whistleblower protection laws continue to fail to meet international standards, and fall significantly short of best practice. Lacking strong legal protections, government and corporate employees who report wrongdoing to their managers or to regulators can face dismissal, harassment and other forms of retribution. With employees deterred from coming forward, government and corporate misconduct can be perpetuated. Serious wrongdoing such as corruption, fraud, financial malpractice, public health threats, unsafe consumer products and environmental damage can persist without remedy. Objective This report analyses the current state of whistleblower protection rules in each of the G20 countries, applying to the identification of wrongdoing in both the public and private sectors. It is the first independent evaluation of G20 countries' whistleblowing laws for both the private and public sectors, having been researched by an international team of experts drawn from civil society and academia. While G20 countries do self-reporting on implementation, to date this reporting has been "broad brush", and tends towards a more flattering and less useful picture of progress than may really be the case. By contrast, this report uses recognised principles to provide a more in-depth picture of the state of progress, and whether a case for continued high-level cooperation remains. Each country's laws were assessed against a set of 14 criteria (see Table below), developed from five internationally recognised sets of whistleblower principles for best legislative practice. The report is based on a public consultation draft released in June 2014. Earlier draft findings and the consultation draft were distributed to a wide range of experts and whistleblowing-related NGOs in G20 countries. The consultation draft was also submitted to all G20 governments for comment, through the T20 (Think20) engagement group and the G20 Anti-Corruption Working Group. This report only analyses the content of laws related to whistleblower protection in each country. This written law is only part of what is necessary to ensure those who reveal wrongdoing are protected in practice, with actual implementation of any law representing a different and ongoing challenge for G20 countries. We stress that positive assessment of the presence and comprehensiveness of legal provisions in this report is not a measure of the extent or quality of actual whistleblower protection in any country. Further, in countries with lower scores, there may be cultural or other norms that in fact indirectly assist in practical protection of whistleblowers. Details: Blueprint for Free Speech, 2014. 76p. Source: Internet Resource: Accessed October 9, 2014 at: https://blueprintforfreespeech.net/wp-content/uploads/2014/09/Whistleblower-Protection-Laws-in-G20-Countries-Priorities-for-Action.pdf Year: 2014 Country: International URL: https://blueprintforfreespeech.net/wp-content/uploads/2014/09/Whistleblower-Protection-Laws-in-G20-Countries-Priorities-for-Action.pdf Shelf Number: 133609 Keywords: Corporate CrimeCorruptionFinancial CrimesFraudWhistleblower Law and LegislationWhistleblower ProtectionWhistleblowers (International) |
Author: Binns, Chelsea Ann Title: Bureaupathology and Organizational Fraud Prevention: Case Studies of Fraud Hotlines Summary: This dissertation examined the effect of organizational bureaucracy on fraud hotline performance. Fraud hotlines are used to receive anonymous fraud tips from employees in all sectors to prevent and detect fraud. This work contributes to the research on fraud hotlines, which today is very light. This work also examined individual hotline performance against organization theory, which is absent in the literature. The literature also doesn't include studies using social media data to determine organizational climate. This work contributes to that literature by providing a collective case study examination of the fraud hotlines in six organizations. Their hotline performance was examined in light of the Theory of Bureaucracy. According to the literature, the condition of organizational bureaupathology can result in crime concealment, reduced fraud reporting, and/or reduced hotline performance. To determine the presence and level of dysfunctional organizational bureaucracy and bureaupathology with respect to employees, the primary audience of fraud hotlines, this study qualitatively measured employee perception of specific bureaucracy and bureaupathology indicators in their workplace by examining their company review submissions in social media Hotlines were evaluated using their individual level hotline metrics/statistics and also by examining their specifications, metrics, functionality, and adherence to best practices. Interviews with hotline administrators, an evaluation of the level of reported organizational fraud, and consideration of the historical context was also considered in evaluating the overall performance of the hotlines. This study ultimately determined there is no consistent relationship between organizational bureaupathology and hotline performance. At times, where an organization had more bureaupathology, the hotline tended to perform better, in terms of its metrics, functionality and adherence to best practices. At other times, hotlines with lower levels of bureaupathology tended to perform worse than their counterparts. These organizations were in the private sector, so the sector where a given hotline is operated may be a factor. This study further found better functioning hotlines didn't have less internal fraud. Organizations where employees perceived a high presence of the bureaucracy indicators "Insistence on the Rights of Office" and "Impersonal Treatment" tended to have a better adherence to hotline best practices, yet had a higher instance of internal fraud in comparison to organizations. In other words, the conditions that contribute to a successful hotline may also give rise to fraud, and or inhibit fraud reporting, in the same organizations. This study further determined fraud hotlines might not prevent fraud. Regardless of hotline performance, including the number of calls received, all of the subject organizations experienced employee crime. These results are contrary to expectations but consistent with bureaupathology theory, which says that employees in excessive bureaucracies adhere strongly to organizational rules and procedures and may be incapable of responding to unpredictable events. As a result of the aforementioned findings, organizational hotline assessment methodology should consider external factors, such as the historical context, presence of internal fraud and employee sentiment as factors in assessing organizational fraud, in assessing hotline performance. Details: New York: City University of New York, 2014. 338p. Source: Internet Resource: Dissertation: Accessed January 22, 2015 at: http://works.gc.cuny.edu/cgi/viewcontent.cgi?article=1170&context=etd Year: 2014 Country: United States URL: http://works.gc.cuny.edu/cgi/viewcontent.cgi?article=1170&context=etd Shelf Number: 134435 Keywords: Corporate CrimeEmployee CrimeFraud HotlinesOrganizational CrimeWhite Collar Crime |
Author: Uhlmann, David M. Title: The Pendulum Swings: Reconsidering Corporate Criminal Prosecution Summary: For more than a decade, the Justice Department morphed its approach to corporate crime, eschewing criminal prosecutions in favor of deferred prosecution and non-prosecution agreements that allowed large corporations to avoid the ignominy of criminal convictions. There seemingly were no crimes that did not qualify for corporate absolution. Then, with public alarm increasing over the lack of criminal prosecutions for the financial crisis, the pendulum swung, and criminal prosecutions were back in vogue. In 2014, the Justice Department brought record-setting criminal prosecutions against two European banks for currency manipulation, followed by similar prosecutions against five American and European banks during 2015. What explains the conflicted approach to criminal prosecution of corporations - and what does it reveal about the theoretical basis for corporate criminal liability? I argue that the Justice Department's erratic approach reflects a lack of agreement among practitioners about what is accomplished by the criminal prosecution of corporations, a disagreement that also exists in scholarly accounts of corporate criminal liability focused on retributive and utilitarian purposes of punishment. The emphasis on retributive and utilitarian theory, while instructive, obscures the expressive function of criminal law and the societal need for condemnation, accountability, and justice when crime occurs, particularly in the corporate setting. In this article, I offer a more complete account of corporate criminal prosecution, which reveals the moral content of corporate crime, considers the deterrent value of corporate prosecution, and explains why the expressive value of the criminal law is indispensable in the corporate context. Corporate wrongdoing has pernicious effects on our communities, the economy, and the environment, which warrant the condemnation the criminal law provides. Criminal prosecution of corporations upholds the rule of law, validates the choices of law-abiding companies, and promotes accountability. Together those values contribute to our sense that justice has been done when crime occurs, which enhances trust in the legal system, provides the opportunity for societal catharsis, and allows us to move forward in the aftermath of criminal activity. When corporations face no consequences for their criminal behavior, we minimize their lawlessness, and increase cynicism about the outsized influence of corporations in our society. Details: Ann Arbor, MI: University of Michigan Law School, 2015. 59p. Source: Internet Resource: Accessed August 24, 2015 at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2642455 Year: 2015 Country: United States URL: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=2642455 Shelf Number: 136536 Keywords: Corporate CrimeCriminal LawPunishmentWhite Collar Crime |
Author: Arlen, Jennifer Title: Corporate Governance Regulation Through Non-Prosecution Summary: Over the last decade, federal corporate criminal enforcement policy has undergone a significant transformation. Firms that commit crimes are no longer simply required to pay fines. Instead, prosecutors and firms enter into pretrial diversion agreements (PDAs). Prosecutors regularly use PDAs to impose mandates on firms creating new duties that alter firms' internal operations or governance structures. This Article evaluates PDA mandates to determine whether and when prosecutors can appropriately use them to deter corporate crime. We find that mandates can be justified. But, contrary to DOJ policy favoring mandates for any firm with a deficient compliance program at the time of the crime, we find that mandates should be imposed more selectively. Specifically, mandates are only appropriate if a firm is plagued by "policing agency costs" - in that the firm's managers did not act to deter or report wrongdoing because they benefitted personally from tolerating wrongdoing or from deficient corporate policing. We show that this policing agency cost justification provides guidance on how to reform federal policy to make appropriate use of mandates, guidance which reveals that many mandates are inappropriate. Details: New York: New York University School of Law, 2016. 42p. Source: Internet Resource: NYU School of Law, Public Law Research Paper No. 16-04 ; NYU Law and Economics Research Paper No. 16-06 : Accessed February 25, 2016 at: Year: 2016 Country: United States URL: Over the last decade, federal corporate criminal enforcement policy has undergone a significant transformation. Firms that commit crimes are no longer simply required to pay fines. Instead, prosecutors and firms enter into pr Shelf Number: 137960 Keywords: Corporate CrimeFinancial CrimesWhite-Collar Crime |
Author: European Union Action to Fight Environmental Crime (EFFACE) Title: Evaluation of the strengths, weaknesses, threats and opportunities associated with EU efforts to combat environmental crime Summary: Since its inception in 2013, the EFFACE project has researched many different aspects of environmental crime. This report, 'Evaluation of the strengths, weaknesses, threats and opportunities (SWOT) associated with EU efforts to combat environmental crime,' brings together insights of the current approach of the EU and its Member States in combatting environmental crime, as a basis to later develop policy recommendations. The project identified nine relevant dimensions of the EU's current approach towards combatting environmental crime: The nine dimensions identified are: Data and information management (relevant for Member State and the EU level) Further harmonisation of substantive environmental criminal law at EU level (excluding sanctions) System of sanctions (administrative vs. criminal vs. civil proceedings (relevant for Member States/EU level) Functioning of enforcement institutions and cooperation between them (relevant for Member States/EU level) Trust-based and cooperation-based approaches: environmental crime victims and civil society External dimension of environmental crime - what can EU do (EU only) Use of environmental liability (relevant for Member States/EU level) Organised environmental crime Corporate responsibility and liability in relation to environmental crime Each theme is evaluated in a consistent way; the governance levels analysed include that of the Member States, the EU and the international level. In addition, the aspects above interact with each other; therefore the authors stress the importance of moving forward with policy recommendations that consider these different aspects as a whole and not in isolation. The final recommendations of EFFACE will build on the SWOT analysis. Details: Berlin: EFFACE, 2016. 131p. Source: Internet Resource: Accessed July 12, 2016 at: http://efface.eu/sites/default/files/publications/EFFACE_SWOT%20Analysis.pdf Year: 2015 Country: Europe URL: http://efface.eu/sites/default/files/publications/EFFACE_SWOT%20Analysis.pdf Shelf Number: 139619 Keywords: Corporate CrimeEnvironmental CrimeOffenses Against the EnvironmentOrganized Crime |
Author: Grudnoff, Matt Title: Corporate Malfeasance in Australia Summary: This paper estimates the extent of corporate wrong-doing in Australia, based on data published by: h Australian Competition and Consumer Commission (ACCC) h Australian Securities and Investments Commission (ASIC) h Australian Tax Office (ATO) h Fair Work Ombudsman h Fair Work Commission h Australian Bureau of Statistics (ABS) There are fewer cops patrolling the corporate beat than there were three years ago. The regulators and other government agencies that monitor corporate malfeasance have had staffing cut by 3,926 people (or 14.9 per cent) between the numbers budgeted for in 2013-14 and that for the present year, 2015-16. It is difficult to understand the rationale for these cuts, given the official publications of the relevant agencies show that corporate wrongdoing is widespread in Australia. The Australian Competition and Consumer Commission (ACCC) is responsible for promoting competition and protecting consumers and small businesses against other businesses. Based on its press releases, over the last 10 years the ACCC has taken action against 669 companies: 167 for competition issues, 489 safeguarding consumers and against unfair trade and 13 others. We examined the top 50 Australian listed companies which accounted for 29 of the court appearances. Of those Wesfarmers (Coles) was top of the list and involved in seven cases closely followed by Woolworths (6), Telstra (4), AGL (4) and Origin (3). However, if other out-of-court actions are included Woolworths tops the list being the subject of 29 issues identified in the press releases. The Australian Securities and Investments Commissions (ASIC) performance was also examined over the four and a half years to December 2015 during which it successfully concluded 3,115 cases against corporations, of which 2,095 were criminal matters. This is unlikely to represent the full extent of non-compliance by corporations with relevant legal requirements because ASIC, like most regulators, has limited resources and a reluctance to take formal proceedings unless there is a very high prospect of success and other cheaper enforcement options have been exhausted. Recently ASIC reported on the special case of the construction industry and reported incidents of alleged misconduct. This is a much wider category than the cases already referred to. Nevertheless ASIC reports a large number of incidents with 10,667 cases over those five years. Details: Canberra: The Australia Institute, 2016. 36p. Source: Internet Resource: Discussion Paper: Accessed July 25, 2016 at: http://www.tai.org.au/sites/defualt/files/P247%20Corporate%20malfeasance%20in%20Australia.pdf Year: 2016 Country: Australia URL: http://www.tai.org.au/sites/defualt/files/P247%20Corporate%20malfeasance%20in%20Australia.pdf Shelf Number: 139842 Keywords: Corporate CrimeFinancial Crimes |
Author: Cross, Cassandra Title: Improving responses to online fraud victims: An examination of reporting and support Summary: This study was developed to understand the needs of fraud victims through in-depth interviews conducted with 80 individuals from across Australia who lodged complaints of online fraud involving losses of $10,000 or more in the preceding four years to the Australian Competition and Consumer Commission's (ACCC) "Scamwatch" website or hotline. The aims of the study were: to document the various impacts and harms that victims of online fraud experience; to examine the reasons why some individuals choose to report online fraud to authorities, while others fail to make reports; and to determine how the support needs of this group of victims might best be met. The personal stories of those interviewed describe the financial impact of what occurred, as well as a range of emotional, psychological, interpersonal and physical impacts resulting from their victimisation. In addition, the barriers to reporting the crimes they suffered officially are documented. The report concludes by identifying what victims of online fraud really want in terms of support from government and non-government bodies, friends, relatives and counsellors. Research participants The 80 participants ranged in age from 30 to 77 years, with a mean age of 56. Forty-six (58%) were male and thirty-four (42%) were female. Participants identified as being from a wide range of countries of birth, predominantly Australia (68%), the United Kingdom (11%) and New Zealand (5%). Participants resided in Queensland, New South Wales, Victoria, South Australia and Western Australia. Financial impact Reported financial losses ranged from $10,000 to approximately $500,000. In many cases, participants were not able to indicate precisely how much money they had lost to online fraud, as often losses had been incurred over a lengthy period of time (up to several years) while in other cases, victims had simply lost track of how much money they had sent. Some victims, however, suffered substantial and debilitating financial impacts. Some of the current participants described losing all their superannuation, being 'sucked dry', having to pay off loans over periods of months or years, 'losing everything', losing their life savings, not being able to afford to buy food, and 'throwing good money after bad' by hiring lawyers or pursuing civil proceedings against perpetrators. Details: Sydney: Criminology Research Advisory Council, 2016. 90p. Source: Internet Resource: Accessed October 8, 2016 at: http://www.crg.aic.gov.au/reports/1617/29-1314-FinalReport.pdf Year: 2016 Country: Australia URL: http://www.crg.aic.gov.au/reports/1617/29-1314-FinalReport.pdf Shelf Number: 145372 Keywords: Corporate CrimeFinancial CrimesFraudOnline VictimizationScams |
Author: Ghazi-Tehrani, Adam Kavon Title: Corporate Crime and State Legitimacy: Non-Issue Making in The 2008 Chinese Melamine Milk Scandal Summary: While the study of corporate crime began nearly seventy years ago, academic access to Asian countries, and China in particular, has become available only in the past two decades. The growing economic crime rate in China remains a difficult area of research, but recent studies demonstrate the impact China's economic reform on crime in general. This study aims to apply western corporate crime and state theories to China in an effort to explain both China's economic crime rate and the government's response. This qualitative study draws on information about the 2008 melamine milk scandal from both Chinese and western newspapers, as well as scholarly journals. An analysis of these sources reveals China is similar to the United States of America and other developed nations: economic crime is tolerated if that crime provides a direct benefit for the offending corporation and indirect benefit for the state. China's authoritarian government increases this tolerance as the state is able to both censor the media and use force to prevent social movements, liberties that have a dampening effect on economic crime in western democracies. This implies that without a liberalization of government to match the liberalization of economy, China's economic crime rate will remain high. Details: Irvine, CA: University of California, Irvine, 2011. 50p. Source: Internet Resource: Accessed November 1, 2016 at: http://escholarship.org/uc/item/0gn810gj Year: 2012 Country: China URL: http://escholarship.org/uc/item/0gn810gj Shelf Number: 145781 Keywords: Corporate CrimeEconomic CrimesWhite-Collar Crime |
Author: Australia. Senate. Economics References Committee Title: 'Lifting the fear and suppressing the greed': Penalties for white-collar crime and corporate and financial misconduct in Australia Summary: n 25 November 2015, the Senate referred the matter of inconsistencies and inadequacies of current criminal, civil and administrative penalties for corporate and financial misconduct or white-collar crime to the Economics References Committee for inquiry and report. The terms of reference were as follows: (a) evidentiary standards across various acts and instruments; (b) the use and duration of custodial sentences; (c) the use and duration of banning orders; (d) the value of fine and other monetary penalties, particularly in proportion to the amount of wrongful gains; (e) the availability and use of mechanisms to recover wrongful gains; (f) penalties used in other countries, particularly members of the Organisation for Economic Co-operation and Development [OECD]; and (g) any other relevant matters. Details: Canberra: Australia Parliament, 2017. 108p. Source: Internet Resource: Accessed April 7, 2017 at: http://apo.org.au/files/Resource/economic_references_ctee_lifting_the_fear_march_2017report.pdf Year: 2017 Country: Australia URL: http://apo.org.au/files/Resource/economic_references_ctee_lifting_the_fear_march_2017report.pdf Shelf Number: 144727 Keywords: Corporate CrimeFinancial CrimesWhite-Collar Crime |
Author: Broek, Martin Title: Tax evasion and weapon production: Mailbox arms companies in the Netherlands Summary: Six of the top ten world's biggest arms dealers are based in the Netherlands in order to benefit from its favourable tax and trade system. The revelations of the leaked Panama Papers in April 2016 pushed the issue of tax and tax evasion high up the international political agenda. Prompting scandals and high profile resignations, the 11.5 million documents from the offshore law firm Mossack Fonseca unveiled some of the tricks and strategies that countless politicians, businessmen and elites use to avoid taxes. Among them were arms companies and arms traders, including blacklisted individuals as well as major arms corporations such as Italian arms giant FinnMeccanica. However Panama is just one of the many countries offering corporations secrecy and means of avoiding tax. The Netherlands is another leading player, providing a legal home to thousands of corporations, attracted by its low tax rates, its lack of transparency requirements and its bilateral investment agreements with many nations. Corporations with nothing more than a postal address are able to evade taxes in their own countries, file arbitration claims using Dutch investment agreements, and hide ownership and account details. Amongst the big companies using the Dutch evasion routes are a large number of arms manufacturers and major international defence companies. Who are these tax evading arms companies and what are their strategies? In this report, Stop Wapenhandel and Transnational Institute publish their findings resulting from a search through the Dutch Chamber of Commerce. We found a large number of arms-producing companies with shell companies established in the Netherlands. Most of the production of these companies takes place in the major western arms-producing countries; the United States, United Kingdom, France and Germany. The arms companies turned out to have zero or minimal personnel presence in the Netherlands. Their almost empty offices and sometimes only having a mailbox allows them to legally pay as little tax as possible. The top 100 global arms companies has been used as the starting point for this research. Of the almost US$ 450 billion annual defence production, these top 100 companies are responsible for $392.6 billion. Details: Amsterdam: Transnational Institute, 2016. 45p. Source: Internet Resource: Issue Brief: Accessed May 27, 2017 at: https://www.tni.org/files/publication-downloads/issue-brief-arms-trade-web.pdf Year: 2016 Country: Netherlands URL: https://www.tni.org/files/publication-downloads/issue-brief-arms-trade-web.pdf Shelf Number: 145838 Keywords: Corporate crimeCorruption Financial Crimes Tax Evasion |
Author: Lain, Sarah Title: Corporate Raiding in Russia: Tackling the Legal, Semi-Legal and Illegal Practices that Constitute Reiderstvo Tactics Summary: This paper explores Russian corporate raiding (reiderstvo) tactics, which are used to pressure and/or steal businesses, often with the complicity of corrupt state authorities. Due to its complexity, defining reiderstvo in a way that is helpful can be challenging, but looking at the tactics involved in the practice, rather than the final result - the stealing of the business - can help to focus attention on some of the threats facing business in Russia and the damage done to the country's investment climate. Russian reiderstvo can be a complex process and defining it can be challenging. Indeed, the author found that experts disagree about whether supposedly modern-day examples of reiderstvo - such as the cases of the oil company Bashneft, the chemical producer Togliattiazot and Domodedovo airport - can be labelled as such. In their detailed analysis of how reiderstvo works, Louise Shelley and Judy Deane describe the practice as the use of a "host of illegal tactics ranging from bribery, forgery, corruption, intimidation, and violence employed by raiders to steal companies from their owners, making massive and rapid profits by selling off assets and laundering the proceeds'. This definition certainly holds true for many historical cases, where detailed analysis has revealed a fuller picture of the details and motivations. However, to understand problems associated with reiderstvo today, this definition narrows the focus too much. In reality, the definition is broader. Reiderstvo is not necessarily a single crime aimed at the theft of a business. Reiderstvo tactics are used as a means to achieve multiple and often contrasting ends. This makes the term itself somewhat misleading and at times unhelpful. Although corruption is usually involved, those using reiderstvo tactics do not exclusively rely on illegal practices; indeed, they blur the lines between legal, semi-legal and illegal practices. Often reiderstvo tactics are used as a way to pressure businesses to comply with corrupt requests for personal gain, rather than being used to steal a business outright. Studying the tactics used to pressure businesses as part of a broader view of reiderstvo, rather than concentrating conceptually on reiderstvo, can help to better focus attention on some of the significant threats facing business in Russia and the damage done by reiderstvo to the country's investment climate. Taking this view will assist in better articulating specific measures that need to be taken to combat the various tactics used by those engaged in the practice. This paper, therefore, mostly refers to 'reiderstvo tactics', rather than just 'reiderstvo', in an attempt to capture the wide range of ways that businesses are put under pressure in Russia. Reiderstvo tactics continue to be a concern for businesses in Russia, despite the issue having a lower public profile than during the 1990s and late 2000s. It is difficult to accurately measure the full extent of reiderstvo in Russia, in part because they are often included within broader legislative definitions, such as 'economic crimes', which do not cover or differentiate between the various tactics. It is also difficult because the state agencies tasked with investigating and enforcing against corporate crime are the very agencies that are frequently involved in reiderstvo tactics. These include the tax authorities, security services, courts and legal system, regulatory control agencies, local and regional administrations and law enforcement. Moreover, false accusations of reiderstvo can also be used by state authorities or corporate competitors to falsify criminal cases or pressure business. A key issue is the apparent lack of strong political will to implement comprehensive and consistent measures to protect businesses, despite rhetoric from President Vladimir Putin. The research for this paper - which included an in-depth review of the relevant academic literature and legislation, and interviews with business people, consultants and academic experts - revealed that - apart from a few high-level public cases - reiderstvo tactics are often used at the local level in Russia, frequently involving local political corruption. Initiatives such as the business ombudsman have raised awareness of the need for business protection, but the office is still limited politically in how far it can intervene, and structural issues remain at various levels of government that enable the abuse of power. The paper does not seek to duplicate previous work on reiderstvo, and it is by no means a comprehensive analysis of past and present reiderstvo cases. Instead, this paper seeks to address some of the assumptions surrounding reiderstvo, suggesting that it is more useful to refocus attention on the array of individual legal, semi-legal and illegal means used to pressure businesses. The sum is arguably less important than the parts in understanding how reiderstvo has evolved. By concentrating on reiderstvo tactics rather than the end result, this paper provides a new and improved framework through which Russian business associations and authorities could and should target initiatives to protect business rights. Details: London: Royal United Services Institute for Defence and Security Studies, 2017. 30p. Source: Internet Resource: RUSI Occasional Paper: Accessed September 2, 2017 at: https://rusi.org/sites/default/files/201707_rusi_corporate_raiding_in_russia_lain.pdf Year: 2017 Country: Russia URL: https://rusi.org/sites/default/files/201707_rusi_corporate_raiding_in_russia_lain.pdf Shelf Number: 147009 Keywords: Corporate CrimeCrime Against BusinessesFinancial CrimesPolitical Corruption |
Author: Great Britain. Home Office Title: Transparency in Supply Chains etc. A practical guide Summary: Section 54 of the Modern Slavery Act 2015 requires certain organisations to develop a slavery and human trafficking statement each year. The slavery and human trafficking statement should set out what steps organisations have taken to ensure modern slavery is not taking place in their business or supply chains. This document provides guidance on: who is required to publish a statement how to write a slavery and human trafficking statement how to approve and publish the statement Details: London: Home Office, 2017. 46p. Source: Internet Resource: Accessed December 1, 2017 at: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/649906/Transparency_in_Supply_Chains_A_Practical_Guide_2017.pdf Year: 2017 Country: United Kingdom URL: https://www.gov.uk/government/uploads/system/uploads/attachment_data/file/649906/Transparency_in_Supply_Chains_A_Practical_Guide_2017.pdf Shelf Number: 148680 Keywords: Corporate CrimeForced LaborHuman TraffickingModern SlaverySupply Chains |
Author: Transparency International Title: Hiding in Plain Sight: How UK companies are used to launder the proceeds of corruption Summary: In April 2016 the Panama Papers - a major leak of 11.5 million files from a Panamanian law firm - gave a unique insight into the secretive global corporate networks that help to facilitate corruption. The Paradise Papers - the latest expose on the offshore world, covering 13.4 million files - continue to shine a light on how opaque structures conceal the identities of individuals as well as the origin of their wealth. These scandals highlight the importance of anonymous 'shell' companies to these schemes, as well as the individuals and businesses which create complex networks of these corporate vehicles to aid high-end financial crime. Much attention has been paid to Mossack Fonseca and Appleby - the firms at the centre of these two scandals - which have helped to set-up and manage hundreds of thousands of companies. However, the UK was the second most popular destination for intermediaries and middlemen used by Mossack Fonseca to create and maintain this network, and it is easy to see why. The UK is home to a thriving company formation industry and is a hub for professional corporate services. It is also one of the easiest places in the world to start a company, making it attractive to legitimate and illegitimate business alike. Costing as little as $12 and taking around 15 minutes to complete the forms, UK companies can be created on a large scale for a fraction of the price of those registered in other financial centres. UK companies also carry a veneer of legitimacy due to the country's well established global status. Alongside a range of corporate vehicles, the UK's company formation industry also offers a variety of services, from so-called 'nominee directors' and mailing addresses - giving companies a layer of secrecy - to offshore bank accounts allowing access to the global financial system. Often there will be no trail whatsoever to indicate who sold companies which then go on to be misused. These factors have contributed to the UK featuring as a central location in which to set-up companies for laundering illicit wealth. Using open-source analysis, we have identified 51 major money laundering schemes made possible by the use of UK companies. Financially these scandals could amount to $80 billion or more in illicit wealth, with some of them threatening the financial stability of whole economies. The human damage inflicted on the victims of these crimes is still being counted. By analysing the Trust and Company Service Provider (TCSP) sector and past money laundering cases we have found that, far from being the first line of defence against money laundering, some of these businesses have either been unwitting accomplices or complicit enablers for financial crime. Central to government's recent efforts to tackle money laundering has been introducing public access to information about who really controls companies incorporated in the UK. This constitutes real progress and has put the UK at the forefront of global corporate transparency. Yet this threatens to be undermined by three key issues we have identified during our research into the TCSP sector: Insufficient controls on company formation: there are practically no barriers to UK companies being incorporated by money launderers and no way of tracing their use after they have been established. Lack of checks on the UK company register: Companies House has neither the power nor the resources it needs to ensure the integrity of the UK company register, allowing inaccurate and misleading information being submitted by those wishing to hide illicit activity. Inadequate anti-money laundering (AML) supervision: the UK's patchwork of AML supervisors is not providing a credible deterrent to money laundering failings, which is allowing poor levels of compliance within the TCSP sector covered by the UK's Money Laundering Regulations (MLR). There is also a whole industry of overseas professionals setting-up and managing UK companies who are subject to little or no AML supervision. In this paper we have sought to analyse the potential nature, scale and impact of these problems by looking at the available evidence of what is going wrong. What we have found is that light-touch regulation is coming at a cost, both to the UK's international reputation as a responsible place to do business, and in countries like Ukraine and Azerbaijan who suffer from rampant corruption facilitated by UK companies. We have proposed ten recommendations in three themes that, if implemented, could help end the use of UK companies in laundering corrupt wealth and ensure the UK remains a world leader when it comes to corporate transparency. Details: London: Transparency International, 2017. 51p. Source: Internet Resource: Accessed January 20, 2018 at: http://www.transparency.org.uk/publications/hiding-in-plain-sight/#.WmNkMKinHcs Year: 2017 Country: United Kingdom URL: http://www.transparency.org.uk/publications/hiding-in-plain-sight/#.WmNkMKinHcs Shelf Number: 148889 Keywords: Corporate CrimeCorruptionFinancial CrimesMoney Laundering |
Author: Amnesty International Title: The Great Palm Oil Scandal: Labour abuses behind big brand names Summary: Some of the world's best known companies are selling food, cosmetics and other products containing palm oil from Indonesian plantations on which workers are suffering serious human rights abuses. Wilmar International Limited (Wilmar) controls over 43% of the global palm oil trade, selling to many 'household name' companies. Amnesty International found a range of labour rights abuses on the plantations operated by Wilmar's subsidiaries and suppliers in Indonesia. These abuses include worst forms of child labour, forced labour, discrimination against women workers, people being paid below the minimum wage, and workers suffering injuries from toxic chemicals. Under Indonesian law, many of these abuses can amount to criminal offences but the laws are poorly enforced. Despite these serious abuses, palm oil from many of these plantations continues to be certified by an international initiative - the Roundtable on Sustainable Palm Oil (RSPO) - whose processes are fundamentally flawed. Companies that buy this palm oil claim to consumers that their products have been made using 'sustainable' palm oil. Amnesty International is calling for a major overhaul of how the palm oil industry operates. Companies must end their reliance on weak compliance-based approaches. They must proactively investigate and address abuses all along their supply chain. Amnesty International is also calling on the Indonesian government to improve enforcement of its labour laws, to investigate the abuses it has identified and to initiate prosecutions where there is evidence that criminal offences have been committed. Details: London: AI, 2016. 148p. Source: Internet Resource: Accessed January 25, 2018 at: https://www.amnesty.org/en/documents/asa21/5184/2016/en/ Year: 2016 Country: Indonesia URL: https://www.amnesty.org/en/documents/asa21/5184/2016/en/ Shelf Number: 148921 Keywords: Child Labor Corporate CrimeForced Labor Human Rights Abuses Palm Oil |
Author: Dell, Gillian Title: Exporting Corruption: Progress report 2018: assessing enforcement of the OECD Anti-Bribery Convention Summary: Transparency International's 2018 Progress Report is an independent assessment of the enforcement of the Organisation for Economic Co-operation and Development (OECD) Anti-Bribery Convention, which requires parties to criminalise bribery of foreign public officials and introduce related measures. The Convention is a key instrument for curbing global corruption because the 44 signatory countries are responsible for approximately 65 per cent of world exports and more than 75 per cent of total foreign direct investment outflows. This twelfth such report also assesses enforcement in China, Hong Kong Special Administrative Region of the People's Republic of China, India and Singapore, which are not parties to the OECD Convention but are major exporters, accounting for 18 per cent of world exports. Hong Kong is covered separately in the report, as it is an autonomous territory, with a different legal system from China and export data compiled separately. The report has been prepared by Transparency International, with contributions from our national chapters and experts in 41 OECD Convention countries, as well as in China, Hong Kong SAR, India and Singapore. Details: Berlin: Transparency International, 2018. 160p. Source: Internet Resource: Accessed September 18, 2018 at: https://www.transparency.org/whatwedo/publication/exporting_corruption_2018 Year: 2018 Country: International URL: https://www.transparency.org/whatwedo/publication/exporting_corruption_2018 Shelf Number: 151569 Keywords: Bribes Corporate CrimeCorruption Financial Crime Political Corruption |
Author: Global Financial Integrity Title: Kenya: Potential Revenue Losses Associated with Trade Misinvoicing Summary: Trade misinvoicing is a reality impacting Kenya and every other country of the world. Imports coming into a country can be over-invoiced in order to shift money abroad. Or imports can be under-invoiced in order to evade or avoid customs duties or VAT taxes. Similarly, exports going out of a country can be under-invoiced in order to shift money abroad. And exports are occasionally over-invoiced, for example in order to reclaim VAT taxes. Global Financial Integrity finds that trade misinvoicing is the most frequently utilized mechanism facilitating measurable illicit financial flows. Misstating import and export values has become normalized in much of commercial trade, and the same facilitating shadow financial system is used to move money of criminal and corrupt origin. We are dealing with a systemic problem that merits serious concerted attention. Parties to trade who engage in misinvoicing do so because it is profitable to them. That is, they will incur some costs (including the expected cost of getting caught) but do so because the expected benefits to them of misinvoicing are larger than their expected costs. While those parties benefit from misinvoicing, there are additional social costs to nations affected by such activity. Trade misinvoicing redirects economic resources away from their most productive use (i.e., it is a type of "rent-seeking" activity) and that can result in social inefficiencies in the allocation and distribution of resources. While any country may be affected by misinvoicing, the problem is particularly acute for developing countries where productive capacities may already be limited. The social costs of misinvoicing can undermine sustainable growth in living standards in developing countries as well as exacerbate already pronounced inequities in the distribution of income and wealth. Moreover, by depressing government revenues and exacerbating inequality, those social costs can also impede progress in the developing world on important social goals, such as poverty reduction. In this analysis we seek to provide an approximate measure of revenues lost to the Kenyan government due to trade misinvoicing. We illustrate this in the first section of the report for 2013 (the last year for which comprehensive data for Kenya are available). For that year, we can reasonably identify potential revenue losses in excess of US$907 million, or about 8 percent of total Kenyan government revenues. That is a conservative figure, as it does not encompass many aspects of trade misinvoicing and other illicit financial flows that do not show up in official statistics. Moreover, the detailed data available for estimating trade misinvoicing in Kenya comprise a fraction of all of that country's trade flows. Furthermore, we take one aspect of this problem - import under-invoicing - and subject it to detailed analysis utilizing detailed bilateral trade data. We find that Kenyan imports of cereal from Pakistan, mineral fuels from India and, more generally, imports from China to be particularly prone to potential revenue loss to the government of Kenya due to under-invoicing. All researchers on this issue of trade misinvoicing are constantly seeking better data and better analytical methodologies. Even as we work toward these goals, what is most important is to appreciate the order of magnitude of the problem and the potential for development revenues if the problem is curtailed. Recognizing the shortcomings in data, Global Financial Integrity has developed GFTrade, a database of current world market prices of 80,000 categories of goods in the Harmonized System, as traded by 30 of the largest global economies. This enables emerging market and developing country customs and revenue authorities to assess instantly the risk that trade misinvoicing may be a reality in transactions as they are coming in or going out. GFTrade is in use in Africa now. Details: Washington, DC: Global Financial Integrity, 2018. 32p. Source: Internet Resource: Accessed October 10, 2018 at: https://www.gfintegrity.org/wp-content/uploads/2018/10/GFI-Kenya-Potential-Revenue-Losses-Associated-with-Trade-Misinvoicing.pdf Year: 2018 Country: Kenya URL: https://www.gfintegrity.org/wp-content/uploads/2018/10/GFI-Kenya-Potential-Revenue-Losses-Associated-with-Trade-Misinvoicing.pdf Shelf Number: 152890 Keywords: Corporate CrimeCorrupt Practices Financial Crimes Illicit Financial Flows Money Laundering Tax Evasion |
Author: Global Financial Integrity Title: A Scoping Study of Illicit Financial Flows Impacting Uganda Summary: Insufficient levels of financial transparency-globally and domestically-and government accountability in Uganda, coupled with a regulatory system that can incentivize financial crimes, are helping to drive high levels of illicit financial inflow and outflows in the country, which are undermining development efforts. Uganda will struggle to meet its goal of rising to middle income status and reducing its reliance on foreign debt unless it increases efforts to combat the commercial tax evasion, corruption, and money laundering of criminal proceeds and terrorist financing. Three policy areas should be the central focus for the government: eliminate the allowance and use of anonymous companies in the economy, reduce the ease and volumes of trade misinvoicing, and enforce anti-money laundering laws, particularly within the banking sector. Illicit financial flows (IFFs) in Uganda are part of a broader political economy dynamic where continued economic growth and development are hampered by corruption, impunity, and an opaque extractive sector. The growth in Uganda's economy and its role as a haven for legal and illegal activities stemming from neighboring countries like South Sudan, create perverse opportunities for illicit financial flows. The central government has a decent capacity to combat these opportunities for IFFs on paper, but its willingness or capacity to act to curtail IFFs is lagging. Trade misinvoicing is the most significant area of illicit financial flows in Uganda that can be estimated using publicly available data. From 2006-2015, the latest years for which the necessary data are available, potential trade misinvoicing amounted to roughly 18 percent of total Ugandan trade over the ten-year period. The figure for possible outflows is some 10 percent of total trade, and for possible inflows it is around 8 percent of total trade (2006-2015). Viewed in dollar terms, the potential over- and under-invoicing of imports from 2006-2015 was approximately US$4.9 billion, and over- and under-invoicing of exports may have reached US$1.7 billion. Uganda's laws and regulations on financial transparency and anti-money laundering have the strongest influence on illicit financial flows, and there are notable gaps in the framework the Government of Uganda has in place to address the sources, transfer methods, and motivations of IFFs in the country. In particular, laws governing corporations in Uganda are generally weak in so far as they do not require the official identification of the beneficial owners of companies or the complete identity of all shareholders in a company. The government's anti-money laundering regime mostly exists on paper and could do with strengthening. The Financial Intelligence Authority, which was only recently established, acknowledges this shortcoming and is working to enhance its performance in helping to prevent, track, and prosecute money laundering in the country. Uganda's extractive sector and the presence of numerous transnational crime markets add to the importance of both financial transparency and anti-money laundering. Details: Washington, DC: GFI, 2018. 80p. Source: Internet Resource: accessed October 16, 2018 at: https://www.gfintegrity.org/wp-content/uploads/2018/10/A-Scoping-Study-of-Illicit-Financial-Flows-Impacting-Uganda.pdf Year: 2018 Country: Uganda URL: https://www.gfintegrity.org/wp-content/uploads/2018/10/A-Scoping-Study-of-Illicit-Financial-Flows-Impacting-Uganda.pdf Shelf Number: 152979 Keywords: Corporate CorruptionCorporate CrimeFinancial CrimeIllicit Financial FlowsMoney LaunderingTax EvasionTerrorist financing |
Author: Global Financial Integrity Title: Nigeria: Potential Revenue Losses Associated with Trade Misinvoicing Summary: Analysis of trade misinvoicing in Nigeria in 2014 shows that the potential loss of revenue to the government was approximately $2.2 billion for the year, according to a new study by Global Financial Integrity. To put this figure in context, this amount represents four percent of total annual government revenue as reported to the International Monetary Fund. Put still another way, the estimated value gap of all imports and exports represents approximately 15 percent of the country's total trade. The report, titled Nigeria: Potential Revenue Losses Associated with Trade Misinvoicing, analyzes Nigeria's bilateral trade statistics for 2014 (the most recent year for which sufficient data are available) which are published by the United Nations Comtrade. The detailed breakdown of bilateral Nigerian trade flows in Comtrade allowed for the computation of trade value gaps that are the basis for trade misinvoicing estimates. Import gaps represent the difference between the value of goods Nigeria reports having imported from its partner countries and the corresponding export reports by Nigeria's trade partners. Export gaps represent the difference in value between what Nigeria reports as having exported and what its partners report as imported. The portion of revenue lost due to the misinvoicing of exports was $1.3 billion during the year which was related to a reduction in corporate income taxes. The portion of revenue lost due to the misinvoicing of imports was $880 million. This amount can be further divided into its component parts: uncollected VAT tax ($100 million), customs duties ($365 million), and corporate income tax ($415 million). Lost revenue due to misinvoiced exports was $1.3 billion for the year which is related to lower than expected corporate income and royalties. "The practice of trade misinvoicing has become normalized in many categories of international trade" according to GFI President Raymond Baker. "It is a major contributor to poverty, inequality, and insecurity in emerging market and developing economies. The social cost attendant to trade misinvoicing undermines sustainable growth in living standards and exacerbates inequities and social divisions, issues which are critical in Nigeria today." Examination of the underlying commodity groups which comprise Nigeria's global trade show that a large amount of lost revenue ($200 million) was related to import under-invoicing of just five product types. Those products and the related estimated revenue losses include: vehicles ($100 million), iron and steel products ($40 million), electrical machinery ($20 million), ceramics ($20 million), and aluminum products ($20 million). Lost revenue due to mispriced exports ($1.3 billion) may be related to the mineral fuels trade given this category of goods makes up over 90 percent of all exports. Trade misinvoicing occurs in four ways: under-invoicing of imports or exports, and over-invoicing of imports or exports. In the case of import under-invoicing fewer VAT taxes and customs duties are collected due to the lower valuation of goods. When import over-invoicing occurs (i.e. when companies pay more than would normally be expected for a product), corporate revenues are lower and therefore less income tax is paid. In export under-invoicing the exporting company collects less revenue than would be anticipated and therefore reports lower income. Thus, it pays less income tax. Corporate royalties are also lower. Total misinvoicing gaps related to imports can be broken down by under-invoicing ($2.4 billion) and over-invoicing ($1.9 billion). It should be noted that these figures represent the estimated value of the gap between what was reported by Nigeria and its trading partners. The loss in government revenue is a subset of these amounts and is based on VAT tax rates (5 percent), customs duties (15.2 percent), corporate income taxes (22.4 percent), and royalties (.2 percent) which are then applied to the value gap. Export misinvoicing gaps were a massive $5.9 billion for export under-invoicing and $5.6 billion for export over-invoicing. Lost corporate income taxes and royalties are then applied to export under-invoicing amounts to calculate lost government revenue. Details: Washington, DC: GFI, 2018. 32p. Source: Internet Resource: Accessed November 3, 2018 at: https://www.gfintegrity.org/wp-content/uploads/2018/10/Nigeria-Report-2018.pdf Year: 2018 Country: Nigeria URL: https://www.gfintegrity.org/wp-content/uploads/2018/10/Nigeria-Report-2018.pdf Shelf Number: 153244 Keywords: Corporate CrimeCorrupt PracticesFinancial CrimesIllicit Financial FlowsMoney LaunderingTax Evasion |
Author: Global Financial Integrity Title: Illicit Financial Flows to and from 148 Developing Countries: 2006-2015 Summary: This is the latest in a series of reports, issued on a roughly annual basis by Global Financial Integrity (GFI), which provides country-level estimates of the illicit flows of money into and out of 148 developing and emerging market nations as a result of their trade in goods with advanced economies, as classified by the International Monetary Fund. Such flows - hereafter referred to as illicit financial flows (IFFs)-are estimated over the years from 2006 to 2015, the most recent ten year period for which comprehensive data are available. In addition to updating the estimated IFFs GFI has presented in the past, this report widens the scope of its research and uses a more detailed database published by the United Nations (UN) along with updated measures from the International Monetary Fund (IMF) data it has used previously. This report presents estimates of IFFs based on both data sets. GFI defines IFFs as "money that is illegally earned, used or moved and which crosses an international border." Currently, the World Bank, IMF, UN, and the OECD use a similar definition. This study underscores the point that trade-related IFFs appear to be both significant and persistent features of developing country trade with advanced economies. As such, trade misinvoicing remains an obstacle to achieving sustainable and equitable growth in the developing world. Details: Washington, DC: GFI, 2019. 56p. Source: Internet Resource: Accessed February 18, 2019 at: https://www.gfintegrity.org/wp-content/uploads/2019/01/GFI-2019-IFF-Update-Report-1.29.18.pdf Year: 2019 Country: International URL: https://www.gfintegrity.org/wp-content/uploads/2019/01/GFI-2019-IFF-Update-Report-1.29.18.pdf Shelf Number: 154642 Keywords: Corporate CorruptionCorporate CrimeFinancial CrimeIllicit Financial FlowsMoney LaunderingTax EvasionTerrorist financingTrade Misinvoicing |