ch 7 AI QUIZ

• White-collar crime is committed by a person of respectability and high social status in the course of his occupation.
• Crime is not limited to just the poor, but occurs in corporate environments as well.
• Crime tracking should concentrate on corporate buildings instead of just poor neighborhoods.
• Groups committing white collar crime are overlooked because of their high economic and social status.

White Collar Crimes

• Examples include misrepresentations in financial statements, stock exchange manipulation, commercial bribery, bribery of public officials, misrepresentation in advertising and sales, embezzlement, and misappropriation of funds.

White-Collar vs. Corporate Crime

• The difference comes down to who benefits from the illegal activity.
• Beneficiary of white-collar crime is an individual.
• Beneficiary of corporate crime is the corporation.
• Both see a very limited response by the criminal justice system despite big losses.

Other Types of Crime

• Occupational crime: individuals who commit crime within the course of their employment, such as theft, fraud, and insider trading.
• Ponzi scheme: returns are paid to investors from their own money or money from other investors, rather than from actual profits earned and requires an ever-increasing flow of money from investors to keep going.
• Pyramid scheme: requires that participants pay for the right to recruit other people into the scheme, at which point they receive money.

Challenges in Studying Corporate Crime

• Information is limited, with only "official" information available about those charged or convicted.
• There are no reliable, large-scale, self-report surveys with information on the prevalence of this type of crime throughout society.

The Public as the Victim

• Corporations are deemed persons under the law but are not subject to the same laws pertaining to persons.
• The impact is not only financial, the public's health can be affected due to the contamination of air, soil, water and faulty products.
• The odds weigh heavily in favor of corporations not only because of wealth but status under the law.
• It can be difficult to find the people that committed the crime (the people don’t work there anymore as so much time has passed) then they have to prove that the crime was committed but often records are "lost".
• It is easier to make the company liable for the harms rather than people and the company may do a settlement and pay out the victims.
• Sometimes the government wants to make an example out of the company as a deterrent or as a warning to other companies.
• Companies might know that they were committing a crime, and they know the risks of being caught and what they would have to pay and internalize the cost if they were caught.

Crime Against Consumers

• Ford Pinto example: the cost-benefit analysis showed it was cheaper to pay out victims instead of doing a recall, also known as profit over human consideration.
• Criminal prosecutions for white collar crimes are exceedingly rare.

Reasons for Few Prosecutions

• The public is more concerned about street and violent crime.
• Police culture is more oriented toward street crime.
• White-collar crime is complex and costly to investigate/prosecute.
• White-collar crime is often multi-jurisdictional, and involves multiple agencies.
• There’s jurisdictional overlap between regulators and RCMP.
• Regulators may be "captured" (their interests are aligned with industry).
• May involve going after powerful political or large economic interests with well-resourced legal teams.
• Legal cases can depend on political willingness to enforce.
• White collar crime benefits not just themselves but also helps the company as a whole.

Financial Collapse of 2008

• The global economy collapsed, partly enabled by deregulation and minimal consequences.
• Story of the $9 billion security business, where a woman reported sleazy things happening and wore a wire to work but the government still chose to settle.
• The company gets to get off scott free basically where they don’t admit to wrong doing they just have to pay.

Bread Price Fixing Scandal

• Loblaws admitted in late 2017 that it had fixed the price of bread with other companies for 15 years, leading them to receiving immunity from criminal charges.
• Loblaws became the whistleblower because they felt they were getting close to being caught and they wanted to be treated more leniently.

Diesel Gate Scandal

• Involved environmental harm, with companies creating false advertising about "clean diesel."
• Companies installed a device that limited pollutants when tested, versus when the car was driving it was letting out all the pollutants.
• Created more toxic pollution in the air, which may have caused tens of thousands of premature deaths.
• It was hard to get any punishments and prosecution.
• You can now be liable if someone was killed on the job if you are a boss.

State Corporate Crime

• Not just corporations breaking laws but the environment that government creates that makes certain people more vulnerable or makes it easier to break the laws.
• Kelowna historically relies on migrant workers that are easy to take advantage of due to the temporary foreign workers program constructed by the government.

Enron Case

• Enron took advantage of a newly deregulated energy market and close relationship with the White House in the late 1990s.
• Two traders at Enron were making tons of money off of a scheme created. Factors that made this crime possible:
  • Deregulated markets.
  • Close relationship between Ken Lay and President Bush.
  • Bush endorsed his company saying that there was so much integrity.
  • Jeff Skilling's idea to create a stock market for energy.
  • Mark to market accounting treatment (book potential future profits for the future): beginning of a major card of the downfall of Enron.
  • Created a competitive work culture with massive bonuses.
  • The community of Enron was cultish.

Factors Enabling the Crime

• Ken Lay was very close to the government and the Bush family.
• High-risk environment where they valued risk-taking and aggressiveness.
• Structure of Enron fueled the competitiveness, eliminating 15% of the "bottom" of the workforce every year as everyone was ranked.

Feminist Criminology

• Focuses not only on women and why women carry out crimes but also how gender factors into who and why people are carrying out crime.

Regulatory Capture Theory

• Regulators are to look out for public interest but often end up siding with the companies.
• Government officials and regulators (usually industry people) end up feeling like they are on the same side with the company (the regulators) because they are spending more time with the company than the government.

Green Criminology

• Focuses on various forms of environmental harms and pollution, with often low fines.

Political Crime

• Crimes committed against the state.
• Terrorrism is crime committed for a political reason
• FLQ in the '70s: Quebec independance
• The mounties stole membership lists
• The government also committed crimes in response to FLQ terrorist acts.

Crime in Trusted Social Organizations

• Total institutions exercise total control over a population, leading to abuses of power.
• Examples: residential schools, psychiatric units.

Theories to Review

• Emancipation hypothesis
• Control and strain theories
• Merton, Cohen, and Agnew strain theory

Applying Theories to Situations

• Differential association theory: meeting a small group of people that change one's views.
• Hrishi's social control theory: missing bonds to family and school.
• Rational choice theory: deterrence from crime if there is a just and proportionate punishment.
• Social disorganization theory: people are a product of their environment.
• Social exclusion from school leads to crime.
• Social bond and control theory