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Chapter 13 Notes

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University of Guelph
SOC 1500
Mavis Morton

Chapter 13 Crimes of Power: White- collar, Corporate, and Organized Crime - Crimes of the marketplace known as enterprise crimes, which are divided into three categories: White-collar, Cybercrime and organized crime. - Enterprise Crimes: Crimes of opportunity for financial gain that involve breaking regulatory rules but not personal victimization - White-collar crimes: Illegal acts that capitalize on a persons status in the marketplace, e.g, embezzlement, fraud, market manipulation, restraint of trade, and false advertising. - Cybercrime: Using computer technology for illicit gain, such as fraud, and for moral crimes, such as child pornography and stalking. - Organized crime: Crime committed by a gang, e.g, drug trafficking Redefining White-collar crime - An illegal act committed by nonphysical means to obtain money or property or to obtain business or personal advantage. - Todays definition of white-collar crime includes all individuals who use the marketplace for their criminal activity, from middle-income Canadians to corporate titans. - White-collar individuals use their positions of trust in business or government to commit crimes, such as pilfering, soliciting bribes or kickbacks, and embezzlement. Other white-collar criminals victimize the public, for example in land swindles, securities thefts etc. Also some white-collar criminals become involved in criminal conspiracies designed to improve the market share or profitability of their corporations such as false advertising and price fixing. Occupational Crime: Crime committed by employees for personal gain using the structural advantage provided by their employment - Society has begun to recognize the seriousness of white-collar crimes such as a judge taking a bribe to give a light sentence, a doctor cheating on medical insurance claims. - Gilbert Geis says white collar crime is more serious than street crime - White-collar crime occurs in other countries as well. - Offences grouped into 4 categories 1. Corporate Crime: In which legitimate companies commit crime in the course of their usual business, fostered by a strongly competitive environment 2. Government crime: Includes illegal acts committed by government officials or with their knowledge and support as well as cover-ups of other persons crimes 3. Occupational crime: Involves people making extra money by bending or breaking the rules 4. Organized/ professional crime: Involves people or groups of people whose primary source of income is illegal Edehlhertz divides white-collar crime into 4 categories 1. Ad-hoc violations: Committed for personal profit, such as welfare fraud or tax cheating 2. Abuses of trust. Committed against an organization, eg Bribery 3. Collateral business crimes. Committed to protect business, eg concealing environmental crime 4. Con games. Committed to cheat clients, eg Fraudulent Types of White collar crime 1. Swindling: First type of white-collar crime: Staling through deception by individuals who try to bilk people out of their money, e.g, door-to door sale of faulty merchandise -Financial Swindles and Religious swindles 2. Chiselling Second type of white-collar crime: Cheating an organization or its customers - Professional chiseling: professionals can use their positions to chisel clients - Securities Fraud: Chiselling can also take place in the commodity and stock markets. - Churning: A white-collar crime in which a stock-broker makes repeated trades to fraudulently increase his or her commissions. - Insider trading: Illegal buying of stock in a company based on information provided by someone in the company, such as an employee, attorney, or accountant retained by the firm Arbitrage: The practice of buying large blocks of stock in companies that are believed to be the target of corporate buyouts or takeovers. -Internet Fraud: using the internet to intentionally manipulate the securities marketplace for profit. Three types of internet security fraud: a. Market Manipulation: An individual tries to control a price of a stock b. Cyber smear: Works in reverse, negative information is spread online about a stock c. Fraudulent offerings of securities: a criminal creates websites designed to fraudulently sell securities by inflating the value of assets, overstating returns and understanding risks. rd 3. Individual Exploitation of Institutional Position 3 type of white-collar crime: individuals can exploit their power to take advantage of others. Example: a fire inspector can demand that a restaurant owner pay him to be granted an operating license. - Exploitation in Government- Government figures have used their positions to profit from bribes and kickbacks - Exploitation in Industry- Purchasing agents in large companies can demand a kickback for awarding contracts to suppliers and distributors. 4. Influence Peddling and Bribery 4 type of white-collar crime: Individuals in important institutional positions can sell power, influence, and information to outsiders such as government employees taking kickbacks from contractors in return for awarding them contracts.- One major difference between influence peddling and exploitation of an institutional position: Exploitation involves forcing victims to pay for services to which they have a clear right, while influence peddlers and bribe takers use their institutional positions to grant favors and sell information to which their co- conspirators are not entitled. Corruption in the Criminal Justice System - Corruption in the criminal justice system is disturbing. Society looks and expects a higher standard of moral integrity from people empowered to uphold the law. - Credibility of the justice process is weakened when officials who hold power over other people engage in criminal behavior. th 5. Embezzlement and Employee Fraud: Is the 5 type of white-collar crime. Individuals use of their positions to embezzle company funds or appropriate company property for themselves. In this case, the company or organization that emplys the criminal is the victim of the white-collar crime. - Blue- collar Fraud: Employee theft can reach all levels of the organized structure. Blue-collar employees have been involved in systematic theft of a company commonly known as pilferage. - Pilferage: Theft by employees through stealth or deception - Management Fraud: Converting company assets for personal benefit Fraudulently receiving increases in compensation such as bonuses or raises Fraudulently increasing personal holdings of company stock Retaining a position within the company by manipulating accounts Concealing the unacceptabth p
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