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Date: April 30, 2024 Tue
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Results for white collar crimes
4 results foundAuthor: Beaton-Wells Title: The Cartel Project: Report on a Survey of the Australian Public Regarding Anti-Cartel Law and Enforcement Summary: Amongst the Australian public, there is substantial majority support for the view that cartel conduct is unacceptable in the sense that it should be against the law. This view is associated with a positive attitude towards competition as healthy. It is also associated with pre-existing awareness of cartel-related topics, such as the ACCC and price fixing. However, less than a majority support the view that cartel conduct should be a criminal offence and less than a quarter support the view that individuals should be jailed for it. There are few associations between views on whether cartel conduct should be a criminal offence or conduct for which individuals are jailed and demographic attributes such as age, education, work status and political affiliation. However, men are less lenient in their views than women in that they are more likely to consider that cartel conduct should be a crime and that individuals should go to jail for it. Insofar as there is support for treating cartel conduct as a criminal offence, that support is based on a wide range of reasons that encompass its economic effects, its moral character and the instrumental characteristics of the criminal law as a mechanism for deterrence and punishment. There is almost no support for the view that cartel conduct is behaviour for which either companies or individuals alone should be sanctioned; rather, there is almost universal support for the view that sanctions should attach to both. There is substantial majority support for the view that companies and individuals involved in cartel conduct should be publicly named and shamed and that they should be fined. There is clear majority support for the view that the fine imposed on a company for cartel conduct should at least disgorge the company of the illegal profits and strong (one third) support for basing the fine on treble the profits derived from the conduct. There is a significant gap between public opinion about the appropriate level of corporate fines for cartel conduct and the actual level of fines that have been imposed over the last decade in Australia. Opinion is divided on the level of the fine that should be imposed on an individual for cartel conduct as reflected in the fact that maxima of AU$10,000 and AU$500,000 attract similar levels of support. There is relatively less but still majority support for other legal consequences for corporate and individual offenders, such as the requirement that compensation be paid or compliance programs be implemented or, that in the case of individuals, disqualification orders be made. There is low support for the view that immunity from sanctions for cartel conduct should be available in return for being the first to report the conduct to the authorities even if, without such a report, the authorities are unlikely to have detected the conduct. There is thus a clear misalignment between enforcement policy with respect to immunity and public opinion. Cartel conduct is clearly regarded as serious insofar as it is seen as behaviour that: should be treated as illegal, if not criminal; should attract fines that, for companies at least, are considerable and public naming and shaming of those involved; and should not be readily excused on grounds relating to the nature of the companies involved, the reasons for the conduct, or its effects. For those members of the public who consider that it should be a criminal offence, cartel conduct is seen as just as serious as a range of long-standing or well-established criminal offences such as theft, fraud, tax evasion, breach of directors’ duties and insider trading. Consistent with findings generally in crime seriousness research, offences involving physical harm or the risk of such harm to other persons (including consumer protection offences involving misrepresentations over product safety) are seen as more serious than cartel conduct. The seriousness of cartel conduct is viewed generally by the public more in moral terms than in terms of its economic effects, as reflected in: the fact that the reasons for treating such conduct as a criminal offence that attract greatest support are reasons relating to moral characterisations of the conduct as dishonest and deceptive (as distinct from characterizations based on economic effects); the high level of support for publicly naming those involved in the conduct, suggesting this is conduct seen as warranting the stigma of community disapproval; the low level of support for allowing an offender to escape penalties in return for reporting the conduct, a response that sits more comfortably with a moral rather than an instrumental approach; majority support for the view that cartel conduct should be seen as just as serious regardless of its effects or circumstances, that is, even if prices do not increase as a result of the conduct, the conduct would prevent factories from closing and would save jobs, or the companies involved are small businesses; substantial majority support for the view that the conduct should be regarded as more serious when it has elements that make it less acceptable from a moral perspective, namely when it involves coercion of another company to join the cartel or where elaborate steps are taken to conceal the conduct from authorities. There are no significant differences in views on the legal treatment and seriousness of different types of cartel conduct, except to the extent that the public appears to take a more lenient view of market allocation than of price fixing or output restriction. Business people who have roles that make the anti-cartel laws relevant to them have quite a low degree of knowledge of the fact that cartel conduct is a criminal offence. They also have low knowledge of the fact that jail is available for individuals for engaging in cartel conduct: less than one quarter of the business respondents are aware that jail is available as a penalty for individuals for cartel conduct; less than half are aware that cartel conduct is a criminal offence; two thirds know that cartel conduct is a civil contravention but one third are either unsure or think it is not a civil contravention; less than half are aware that a fine is available as a penalty for cartel conduct (whether they believe it is a civil contravention or criminal offence). This same group of business people also perceive the likelihood of enforcement action against cartel conduct as fairly low. They rate the likelihood of being caught for engaging in cartel conduct, being subject to legal action for cartel conduct, and being sentenced to jail (if found guilty of a criminal offence of cartel conduct) as all fairly low. Business respondent perceptions of the likelihood of being caught or of being subject to legal action both increase modestly when they know that cartel conduct is a criminal offence. However: o being caught is still considered unlikely even when business people know cartel conduct is a criminal offence; o the likelihood of a person being subject to legal action once caught is perceived as a little higher than being caught in the first place, but it is still not seen as very likely, even when criminal sanctions apply. Even though perceptions of the likelihood of enforcement do increase when business respondents are told that cartel conduct is a criminal offence, overall the survey results suggest that many business people do not know (without being told) that cartel conduct is a criminal offence. Some do not even know it is a civil contravention. This low level of knowledge suggests that in real life many business people will tend to perceive the likelihood of enforcement against cartel conduct as low. Business respondents generally rate the likelihood of a hypothetical third person or themselves actually engaging in cartel conduct as fairly low, but there are still substantial numbers who report that engaging in cartel conduct would be likely in certain circumstances. In particular: o half of the business respondents report that a hypothetical person would be likely or very likely to engage in cartel conduct where only civil sanctions are available, and nearly one third still see cartel conduct by a hypothetical person as likely where criminal sanctions are available; o almost one in ten business respondents report that they themselves would be likely to engage in cartel conduct if the opportunity presented itself – even where criminal sanctions are available. Business people’s ratings of the likelihood of themselves or another person engaging in cartel conduct are lower when the respondent knows the conduct is criminal than when they know it is only a civil contravention. But, as mentioned above, the survey also shows that knowledge that cartel conduct is a criminal offence is in fact quite low. Therefore many business people might still have a tendency to engage in cartel conduct if the opportunity arises, not knowing that it is a criminal offence. Preliminary analysis of the survey results suggests that business people are more likely to engage in cartel conduct when they are under economic pressure to do so, even though they know that criminal sanctions are available for such conduct. That is, knowing about criminal sanctions and the availability of jail may not outweigh economic pressure to engage in cartel conduct. Further analysis is necessary to test the robustness of this result. Not surprisingly, business respondents are more likely to rate another person as likely to engage in cartel conduct, than they are to rate themselves as likely to engage in such conduct. It is likely, however, that to some extent at least respondents’ ratings of what another person is likely to do in fact reflect their own tendencies. Moreover business respondents see other business people as influenced by deterrence (that is the likelihood of enforcement) in making decisions about engaging in cartel conduct. They do not see themselves as influenced by likelihood of enforcement in deciding whether to engage in cartel conduct to the same extent as other people. It therefore seems likely that business people like to think of themselves as making decisions about engaging in cartel conduct on an ethical basis (in relation to the morality or harm of the conduct), rather than making a calculated decision about the costs and gains of non-compliance with anti-cartel law (on the basis of perceptions of the likelihood of deterrence). This is consistent with the survey findings that suggest that members of the public generally view cartel conduct through a moral rather than an economic lens. Details: Melbourne: University of Melbourne, School of Law, 2010. 374p. Source: Internet Resource: Legal Studies Research Paper No. 519; Accessed October 22, 2011 at: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1743268 Year: 2010 Country: Australia URL: http://papers.ssrn.com/sol3/papers.cfm?abstract_id=1743268 Shelf Number: 123117 Keywords: Business CartelsFinancial CrimesPunishment, White Collar OffensesWhite Collar Crimes |
Author: Hicks, David Title: Economic Sectors Vulnerable to Organized Crime: Securities Summary: This report offers a detailed and accessible study of the vulnerabilities to organized crime affecting the securities sector in Canada. Much of the focus is directly or indirectly placed on Toronto (Ontario) and Montreal (Quebec) given that these jurisdictions host and regulate the main Canadian stock and derivatives exchanges, respectively. Since 2002 the Criminal Code has provided an expansive definition of organized crime/criminal organizations that includes three or more persons involved in a group that has as one of its main purposes or activities the commission of serious offences. At the time of writing, we were unable to locate any securities-related cases where a Canadian court has issued a conviction for criminal organization charges although we are aware of one pending case. There are clearly ongoing difficulties in applying the label organized crime to the stereotypical groups (Type I), let alone the diversity of individuals and groups (Type II) that may facilitate or collude in securities-related misconduct and crime. The information reviewed shows that individuals who violate the Criminal Code are typically charged with fraud. The securities sector plays a key role in Canada's financial services industry and economy. The total market capitalization in 2010 amounted to $2.3 trillion or 4 per cent of total trading among the world stock exchanges. While the 2011 Supreme Court of Canada decision rejected the federal government move towards a national securities regulator, the sector is a complex and de-centralized model of provincial regulation and cooperative national harmonization of key features. In addition, 'national' self-regulatory organizations (SROs) that receive their mandate through provincial legislation play a critical role to regulate the member firms and their employees. The securities sector is vulnerable to organized crime for several reasons, not least that this is a hybrid zone with a focus on regulatory approaches and difficulties in applying crime labels. Potential wrong-doing can be difficult to identify and the interpretation of motivations and behaviour is not as clear as in other fields, such as interpersonal crimes. The securities sector is an area of low visibility that requires proactive enforcement and prevention, in part because victims may tend not to complain due to embarrassment or lack of knowledge, and industry participants may not want to report rule violations that would undermine confidence in their business. Organized crime involvement in capital market offences is possible at several levels in terms of the depth of its infiltration of the securities market. The securities sector may be a site for the laundering of proceeds of crime generated outside of the industry, for instance, drug money, or a site for fraud and related laundering of proceeds generated to varying degrees within or alongside the sector. Criminal organizations can establish real or paper-based companies and sell real or fictitious stocks outside the regulated market, or attempt to secure the cooperation of industry insiders through the threat of violence or in repayment of gambling debts. It is also possible that criminal organizations or their members may establish partial or direct beneficial ownership of brokerage houses and engage a broader and deeper exploitation of victims. Some schemes that occur in Canada include fraudulent high-yield investments, pyramid or Ponzi schemes, and illicit 'tax-free' investments. The 20 (N=20) interviewees expressed particular concerns about Canadian investor involvement with boiler-room operations and the regulatory light-touch segments of international markets such as pink sheets and Over-the-Counter Bulletin Board (OTCBB) in the United States, the Frankfurt Stock Exchange (FSE) in Germany, and domestic markets, such as exempt securities. Fundamentally, vulnerability is represented in the asymmetry between investors and (potentially fraudulent) market actors within or outside of the securities sector. The imbalance of information, knowledge and control in favour of market actors can be reduced through the scope and intensity of regulatory oversight. However, this can also result in push and pull factors for fraudulent behaviour to capitalize on variable standards across jurisdictions and national boundaries. Vulnerability is also a product of the convergence in the securities sector of a wide range of complementary and competing government, regulatory, industry and business, and investor interests. The essential profit-driven logic underlying commercial crimes is an apparently voluntary trade in (typically) legal goods and services combined with illegal (fraudulent) methods to manipulate market values to the disadvantage of victims. Enforcement data presented by regulatory authorities and the SROs illustrate their attempts to address these vulnerabilities. The volume of criminal charges in the securities sector remains limited in number but substantial in terms of estimated losses. Reducing the vulnerability to crime and organized crime in the securities sector can be achieved through systematic attention to the limitations and possibilities of market forces and control systems. There is an ongoing need for basic and enhanced public education for investors to better protect themselves and to promote a culture of lawful and ethical behavior. Control agencies should function as interdependent (rather than strictly independent) agents within a clear set of defined goals and a coordinated strategy is necessary to detect and deter violations and to reduce impact and harm by issuing proportionate sanctions. Stakeholders could consider research and policy development in the design and implementation of a national data collection and securities intelligence model. This could improve the separate and cumulative detection and deterrence of serious repeat offending in Canadian capital markets, and its potential utility as a vehicle for criminals and organized crime. Details: Ottawa: Public Safety Canada, 2012. 65p. Source: Internet Resource: Report No. 26: Accessed October 28, 2013 at: http://publications.gc.ca/collections/collection_2012/sp-ps/PS4-123-2012-eng.pdf Year: 2012 Country: Canada URL: http://publications.gc.ca/collections/collection_2012/sp-ps/PS4-123-2012-eng.pdf Shelf Number: 131494 Keywords: Financial CrimesOrganized Crime (Canada)Securities MarketWhite Collar Crimes |
Author: Association of Certified Fraud Examiners Title: Report to the Nations on Occupational Fraud and Abuse: 2014 Global Fraud Study Summary: Summary of Findings -Survey participants estimated that the typical organization loses 5% of revenues each year to fraud. If applied to the 2013 estimated Gross World Product, this translates to a potential projected global fraud loss of nearly $3.7 trillion. -The median loss caused by the frauds in our study was $145,000. Additionally, 22% of the cases involved losses of at least $1 million. -The median duration - the amount of time from when the fraud commenced until it was detected - for the fraud cases reported to us was 18 months. -Occupational frauds can be classified into three primary categories: asset misappropriations, corruption and financial statement fraud. Of these, asset misappropriations are the most common, occurring in 85% of the cases in our study, as well as the least costly, causing a median loss of $130,000. In contrast, only 9% of cases involved financial statement fraud, but those cases had the greatest financial impact, with a median loss of $1 million. Corruption schemes fell in the middle in terms of both frequency (37% of cases) and median loss ($200,000). -Many cases involve more than one category of occupational fraud. Approximately 30% of the schemes in our study included two or more of the three primary forms of occupational fraud. -Tips are consistently and by far the most common detection method. Over 40% of all cases were detected by a tip - more than twice the rate of any other detection method. Employees accounted for nearly half of all tips that led to the discovery of fraud. -Organizations with hotlines were much more likely to catch fraud by a tip, which our data shows is the most effective way to detect fraud. These organizations also experienced frauds that were 41% less costly, and they detected frauds 50% more quickly. -The smallest organizations tend to suffer disproportionately large losses due to occupational fraud. Additionally, the specific fraud risks faced by small businesses differ from those faced by larger organizations, with certain categories of fraud being much more prominent at small entities than at their larger counterparts. -The banking and financial services, government and public administration, and manufacturing industries continue to have the greatest number of cases reported in our research, while the mining, real estate, and oil and gas industries had the largest reported median losses. -The presence of anti-fraud controls is associated with reduced fraud losses and shorter fraud duration. Fraud schemes that occurred at victim organizations that had implemented any of several common anti-fraud controls were significantly less costly and were detected much more quickly than frauds at organizations lacking these controls. -The higher the perpetrator's level of authority, the greater fraud losses tend to be. Owners/executives only accounted for 19% of all cases, but they caused a median loss of $500,000. Employees, conversely, committed 42% of occupational frauds but only caused a median loss of $75,000. Managers ranked in the middle, committing 36% of frauds with a median loss of $130,000. -Collusion helps employees evade independent checks and other anti-fraud controls, enabling them to steal larger amounts. The median loss in a fraud committed by a single person was $80,000, but as the number of perpetrators increased, losses rose dramatically. In cases with two perpetrators the median loss was $200,000, for three perpetrators it was $355,000 and when four or more perpetrators were involved the median loss exceeded $500,000. -Approximately 77% of the frauds in our study were committed by individuals working in one of seven departments: accounting, operations, sales, executive/upper management, customer service, purchasing and finance. -It takes time and effort to recover the money stolen by perpetrators, and many organizations are never able to fully do so. At the time of our survey, 58% of the victim organizations had not recovered any of their losses due to fraud, and only 14% had made a full recovery. Details: Austin, TX: Association of Certified Fraud Examiners, 2014. 80p. Source: Internet Resource: Accessed September 9, 2014 at: http://www.acfe.com/rttn/docs/2014-report-to-nations.pdf Year: 2014 Country: International URL: http://www.acfe.com/rttn/docs/2014-report-to-nations.pdf Shelf Number: 133182 Keywords: Costs of CrimeCrimes Against Businesses Financial CrimesOccupational FraudWhite Collar Crimes |
Author: Shrivasta, Utkarsh Title: ICT as a Corruption Deterrent: A Theoretical Perspective Summary: Investigations of white collar crimes such as corruption are often hindered by the lack of information or physical evidence. However, vast amount of information recorded, stored, analyzed, and shared using information and communication technologies (ICT) by businesses, governments, and citizens may help in investigating and prosecuting these crimes, and in deterring future crimes. This paper investigates the relationship between ICT and corruption at the country level using the theoretical lens of general deterrence theory. Using time-lagged regression and multilevel analysis of country level data from 97 countries for the years 2011-2013, we demonstrate that countries with higher ICT penetration and higher rule of law tend to have lesser corruption after accounting for social, economic, and political controls. Details: Puerto Rico: Americas Conference on Information Systems, 2015. 13p. Source: Internet Resource: Accessed January 9, 2019 at: https://pdfs.semanticscholar.org/213a/64668a5a627e0a78850f04916544e79dfb24.pdf Year: 2015 Country: International URL: https://www.semanticscholar.org/paper/ICT-as-a-Corruption-Deterrent%3A-A-Theoretical-Bhattacherjee-Shrivastava/213a64668a5a627e0a78850f04916544e79dfb24 Shelf Number: 154060 Keywords: Corruption Deterrence Theory Information and Communication Technologies Rule of Law White Collar Crimes |