Criminal Liability Of Businesses

Read Complete Research Material



Criminal liability of businesses



Criminal liability of businesses

Introduction

Corporate crime is criminal activity committed by organizations meant to profit the organization. An understanding of corporate crime often requires learning the language of business and conceiving of both crime and victimization in a collective and aggregate sense. Corporate crime has existed as long as there have been corporations, but history shows that more recent corporate crimes have been more extensive and have resulted in greater losses to victims than in years past. There are several different kinds of corporate crimes, and each of these results in different kinds of harm or costs.

Typically, crime information in a local newspaper was contained in the front and middle sections, which provides local crime information as well as news and advertisements. More and more often, however, crime information is found in the business section. The following example begins to answer the question of why crime news has made that shift (McLean, 2004).

Discussion

Corporate crime is one form of occupational crime, which is crime that is committed during the course of one's legitimate occupation. Researchers distinguish blue-collar from white-collar crime by the kind and status of the occupation in which the crime occurs. Blue-collar crime can include theft from one's place of work, such as an automobile mechanic who steals tools from the garage where he works. Blue-collar crime looks like conventional crime because it mainly involves theft.

White-collar crime can include defrauding investors, such through a Ponzi scheme, a fraudulent investment operation that pays returns to individual investors from their own money or money from other investors, rather than from any actual profit. The scheme is named for Charles Ponzi, a mastermind who became famous for generating large volumes of money by using the technique in the early 1920s. In 2009, Bernard Madoff was charged with operating the largest-known Ponzi scheme to date, which bilked investors of $65 billion. Because he was an otherwise trusted investor, he was able to abuse his position for personal gain (Helmkamp, 1997).

A Ponzi scheme, such as that used Madoff, consists of being a fraud on the profits paid to investors using money from those who are entering the business, rather than actual profits. Usually offer returns well above what is available in the market to attract investors (curiously in the Madoff case, the profits that were offered were reasonable, which generated a lot of confidence, even among the authorities, who asked him for advice financial).

And how does not create suspicion or no one notices? At first, while there are more people putting money removing it, just ask for the money just to get it back with interest and all, what makes good opinions are passed from mouth to mouth: "Look, I made this investment is fantastic, and as evidence for the asking regained all my money plus an incredible performance. " The news soon spread and investors are scrambling to join the "elite" group.

As you can see, this can work for a while (even many years, as in the Madoff case) until a ...
Related Ads