Shanna R. Van Slyke and Leslie A. Corbo
Consumer fraud is the intentional deception of one or more individuals with the promise of goods, services, or other financial benefits that either never existed, were never going to be provided, or were grossly misrepresented. In contrast to ancient times when consumer fraud and other white-collar crimes were considered to be at least as serious as violence and other street crimes, today’s consumer fraudster tends to be viewed as less dangerous and deserving of harsh sanctioning. Despite several social movements against consumer fraud and a proliferation of popular and scholarly literature on the topic, contemporary U.S. society has maintained a relatively lenient stance toward white-collar crime—a “soft on crime” position that is inconsistent with conservative “tough on crime” approaches that have dominated U.S. penal policy since the 1960s.
State-corporate crime is defined as criminal acts that occur when one or more institutions of political governance pursue a goal in direct cooperation with one or more institutions of economic production and distribution. This concept has been advanced to examine how corporations and governments intersect to produce social harm. The complexity of state-corporate crime arises from the nature of the offenses; unlike traditional “street crime,” state-corporate crime is not characterized by the intent of a single actor to violate the law for personal pleasure or gain. Criminal actions by the state often lack an obvious victim, and diffusion of responsibility arising from corporate structure and involvement of multiple actors makes the task of attributing criminal responsibility difficult. Sufficient understanding of state-corporate crime cannot be gained through studying individual actors; one must also consider broader organizational and societal factors.
Further subclassification illuminates the different types of state-corporate crime: State-initiated corporate crime (such as the 1986 Space Shuttle Challenger explosion) occurs when corporations, employed by the government, engage in organizational deviance at the direction of, or with the tacit approval of, the government. State-facilitated state-corporate crime (such as the 1991 Imperial Food Products fire in Hamlet, North Carolina) occurs when government regulatory institutions fail to restrain deviant activities either because of direct collusion between business and government or because they adhere to shared goals whose attainment would be hampered by aggressive regulation.
Paul Jesilow and Bryan Burton
Healthcare fraud involves wide-ranging illegal behaviors. It includes such activities as individual physicians who bill insurance companies or the government for services that were never provided, as well as corporate behavior, such as pharmaceutical companies that falsify clinical tests in order to get unsafe drugs approved for use. Thousands die each year in the United States due to these behaviors, including deaths from incorrectly prescribed medications or from tainted drugs that were approved by the U.S. Food and Drug Administration based upon fraudulent testing and reporting. Thousands of additional patients likely are injured and killed by unnecessary surgeries performed by physicians who want to maximize their reimbursements. The illegal activities also add billions of dollars each year to the total healthcare cost in the U.S. Despite these costs, there is relatively little outrage as a result of the behaviors, largely because they remain hidden from public view.
Healthcare fraud, as with almost all white-collar crime, is rarely detected and that prevents the frauds from becoming known to victims, law enforcement, and policy makers, which in turn prevents analysts from compiling a complete picture of the behaviors and prevents policymakers and law enforcement from developing efficient enforcement strategies. Moreover, the lack of detection assures perpetrators that they will get away with their crimes and limits the potential preventative effects of punishment. Lack of detection and reporting has been a particularly strong problem for those trying to control healthcare fraud and abuse in the United States and elsewhere. The enforcement mechanisms that have evolved have been strongly influenced by the difficulties of detecting the illegal behaviors.
Carole Gibbs and Rachel Boratto
Environmental crime is a complex and ambiguous term for several reasons. It is sometimes used as an umbrella term for crimes related to biodiversity, wildlife, animals, natural resources, hazardous waste, banned substances, and environmental quality, but scholars have also developed typologies to capture the unique dimensions of each form of environmental crime. Disagreements regarding whether to distinguish violations of environmental laws (addressed via civil prosecution or administrative actions) from environmental crimes (criminally prosecuted), and whether to also consider environmental harms (legal activities that harm the environment) or environmental risks produce further confusion. The range of offenders also complicates this concept, as individuals, groups/networks, and powerful organizations commit environmental crimes. The degree of harm created by each actor may, or may not, be equivalent.
Given the complexities of this area of study, scholars have developed and/or tested a wide range of theoretical perspectives on and interventions to address environmental crime. Consistent with conceptual disagreements, these theoretical frameworks and corresponding interventions vary (arguably the most) based on whether the dependent variable is environmental crime (as defined by law), or environmental harm or risk defined using other criteria. However, multiple theoretical perspectives/interventions are also examined within research on these broad categories of environmental crime, harm, and risk. In order to capture the breadth of research on environmental crime, we narrow the focus of this article to pollution related crimes (e.g., hazardous waste, banned substances, environmental quality). In the following article, we offer further detail regarding conceptual discussions, legal complexities, types of offenders, types of crime, and research on this subset of environmental crimes.
Extortion as a crime has long attracted the interest of scholars, and much effort has been put into coining a precise definition that would allow distinguishing it from other similar predatory practices such as blackmail, bribery, coercion, and robbery. Academic literature classifies extortive practices according to their degree of complexity and involvement of organized crime. In this sense, the simplest form of extortion displays one offender who receives a one-time benefit from one victim, while the most sophisticated form is illustrated by racketeering, whereby an organized crime group systematically extorts money from multiple victims. Extortion as an organized crime activity can involve both episodic extortion practices and well-rooted systemic practices over a certain territory, where the latter is usually regarded as perpetrated by Mafia-type criminal organizations. Some scholars argue that extortion racketeering as a Mafia crime should be defined as sale and provision of extralegal protection services—protection of property rights, dispute resolution, and enforcement of contracts. However, others contend that extortion by Mafia-type organizations should not be counted as an economic activity but rather be considered as an illegal form of taxation imposed by quasi-political groups. In economic terms, it is a transfer of value and creates no economic output.
In contrast with the traditional understanding of extortion racketeering as “defining activity of organized crime,” some scholars have also focused on “extortion under the color of office,” or, in other words, extortion perpetrated by public servants or politicians in their official capacity. Extortion has often been compared with bribery, since both crimes can be defined as an unlawful conversion of properties and goods belonging to someone else for one’s own personal use and benefit. The debate on the differences between bribery and extortion, however, is a contested one, and has followed two lines of argument: respectively, the degree of coercion involved in the crime and the role (or modus operandi) of public officials in the bribery and extortive scheme. The common element for both crimes is the fact that representatives of the state abuse their power and official position for their own benefit.
Finance crime, that is, white-collar crime that occurs in the markets for financial goods and services, appears to be pervasive in 21st-century capitalism. Since the outbreak of the global financial crisis of 2007–2008, virtually all established financial institutions have been implicated in finance crime scandals, ranging from the mis-selling of financial products to money laundering and from insider dealing to the rigging of financial benchmarks. The financial stakes involved in such scandals are often significant, and at times have the potential to destabilize entire economies. This makes the phenomenon of finance crime a highly relevant topic for white-collar crime researchers. A major challenge, however, for those studying the phenomenon of finance crime is to engage with the complex mechanics of finance crime schemes. These often involve esoteric financial instruments and are embedded in arcane market practices, making them seem impenetrable for those unfamiliar with the intricacies of financial market practices. A helpful way to make the empirical universe of finance crimes intelligible is to construct a typology. This can be meaningfully done by distinguishing finance crimes by the different rationales that underlie the laws and regulations they violate. Doing so renders five main types of finance crime. These are (i) financial fraud, (ii) misuse of informational advantages, (iii) financial mis-selling, (iv) market price and benchmark manipulation, and (v) the facilitation of illicit financial flows.
White-collar crime scholars have taken various theoretical and analytical approaches to the study of finance crime. Some scholars have studied finance crimes in the light of their macro-institutional contexts. Such approaches are based on the premise that actors find meaning—motivations and rationalizations—and opportunities for their actions in the cultural and institutional environments in which they are situated and that such environments can be criminogenic in the sense that they structurally facilitate or even promote illegal behaviors. Others have studied the organizational dimensions of finance crime, looking at both the social networks through which finance crimes are perpetrated as well as the ways in which these networks are embedded in broader organizational and industry structures. Still others have studied the costs, consequences, and victims of finance crimes. Finally, some white-collar crime scholars have studied the ways in which societies create legal regimes that prohibit certain financial market practices as well as how these prohibitions are subsequently enforced by regulatory agencies, public prosecutors, and the courts.
Individual, Educational, and Other Social Influences on Greed: Implications for the Study of White-Collar Crime
Long Wang, Ziwei Wang, and David H. Weng
Greed is a central part of human nature. In history, feudal barons and kings, as war profiteers, continued to engage in war to acquire more after they had accumulated excessive wealth; in the modern era, greed is still rampant as the wealthy and powerful keep accumulating inordinate amounts of wealth and power. Greed does not exist in a social vacuum: it often involves a complementary reduction in other people’s outcomes, even as the greedy actor achieves substantive gains. In addition, people’s resource accumulation often stimulates rather than sates, creating a vicious cycle of extravagant spending and insatiable desire. Historical and philosophical approaches typically connect greed with immoral and deplorable behavior. Religious admonitions even make it more obnoxious and despicable.
Greed is often believed to be an obvious, perhaps too obvious, cause of white-collar crime. There is no shortage of notorious cases of corporate greed, where white-collar offenders engage in amazing frauds and/or extravagant spending sprees. Yet empirical research on the relationships between greed and white-collar crime is rather limited. Greed can be both personal and environmental. On the one hand, our natural needs and wants suggest that people cannot always easily escape the temptations of greed. Thus, for at least some people, greed may be intrinsic, dynamic, and grow across spans of their life cycle. This may make restraining greed a challenging task as it represents a dissonance of human nature. On the other hand, greed is not always portrayed as disgraceful or unacceptable because of its connection to self-interest maximization and market competition, foundational elements of business and economics education and management practices. In particular, when the push for profits is pervasive, traditional, and taken-for-granted in modern organizational life, greed may inadvertently become less derogatory.
Gema Varona and José Luis de la Cuesta
In a broad sense, international criminology can be described as the set of activities related to crime prevention and control, coming from the academia, public and private institutions and agencies, to join efforts to debate and publish and make policies, addressed to a global audience beyond a single country. This process of internationalization of criminology, started since its beginnings as a science, at the end of the 19th century through important congresses and meetings developed in Europe, where public officials and academics met. In the 21st century we can talk of a global or globalized criminology around the world, expressed also via websites on the Internet. Together with international crimes (genocide, crimes against humanity, crimes of war and, to a lesser extent, aggression as crime against peace), transnational crimes (corruption, financial crime, terrorism, organized crime, and its different modalities of illegal trafficking, cyber-attacks, and crimes against the environment), as well as crimes of abuse of (political and economic) power (enforced disappearances, summary executions, torture) are the subject matter of international criminology. However, the concept of international criminology is elastic and welcomes any international approach to other topics, traditionally thought domestically; in any case from the international perspective the social-political dimension of criminality appears as a much more relevant issue than the criminal’s personality (and treatment) and protection of victims and the community become the focus of interest.
Within the internationalization of criminology there are at least two trends that deserve further analysis. The first one is how to balance the cultural differences among all the countries and the myriad of interests involved in the construction of an international criminology. Some criticism is heard in the sense that international criminology is influenced by American or Anglo-Saxon views. From this perspective it is observed a risk of producing academic, legal, and policy criminological transplants without considering the cultural and socioeconomic context of every country and the voices of their inhabitants. The second trend refers to the role of international criminology in relation with the increasingly diffuse borders between police, intelligence agencies, and military forces; crime control and war; or internal and external security. Even though international crimes have always been a core topic, war and political and economic abuse of power across borders have been quite forgotten in the agendas of both national and international criminology. Today there are different forms of cooperation among countries in conflict situations, (e.g., terrorism, border controls, and the so-called refugee crisis) where the military, intelligence agencies, police forces, and private corporations of different countries work together, providing international criminology new topics for critical reflection and action.
American responses to white-collar crime, especially corporate wrongdoing, passed a turning point in 1991 with the enactment of the U.S. Sentencing Guidelines for Organizations, which adopted a “carrot and stick” approach to sentencing corporate offenders, including big incentives for companies introducing compliance programs. In the 2000s, this approach was enhanced by the enactment of the Sarbanes–Oxley Act of 2002 and the Thompson memo of 2003. In addition to the effects of the Thompson memo, federal prosecutors, learning from the fate of Arthur Andersen, came increasingly to rely on deferred prosecution agreements (DPAs) and non-prosecution agreements (NPAs) after 2005. However, the Yates memo issued in September 2015 may change Department of Justice policy on corporate wrongdoing dramatically, particularly regarding investigation and prosecution of individuals.
In thinking about and conceptualizing legal and political responses to white-collar crime, two main actors are meaningful: the corporation and the individual. Today, a corporation is criminally liable under the respondeat superior doctrine in federal criminal law, and corporate offenders are sentenced under the Organizational Sentencing Guidelines, which provide for fines, restitution, and probation as possible criminal penalties. In recent years, around 150–200 organizations have been sentenced under the Sentencing Guidelines annually.
An individual white-collar criminal may be personally liable for their unlawful acts even if the corporation itself is convicted too. Individuals may be convicted absent any showing of mens rea in rare cases (strict liability crime and “willful blindness”). In the last decade, more than 8,000 individuals were prosecuted and convicted, for around a 90% conviction rate. One effect of the Yates memo may be to shift the main target of legal and political response to white-collar crime from the corporation to the individual. New policies under the Yates memo also come with new problems, for instance, that companies may lose incentive to introduce a compliance program or may look for scapegoats to escape prosecution themselves.
Each year, millions of individuals worldwide find themselves victims of online fraud. Whether it is responding to a fraudulent email with bank account details or being defrauded through a false relationship, fraud can have a life-changing impact on an individual victim. For many victims, this goes beyond pure monetary losses and impacts their physical and emotional health and well-being. Historically, fraud has not been the priority of police or government agencies; however, increased developments in technology mean that fraud is affecting a greater number of victims than ever before. The online nature of many fraudulent approaches carries with it a new set of unique challenges associated with the policing and prevention of online fraud, and victim support services are currently not well equipped (if even in existence) to deal with the aftermath of victimization.
Clayton Peoples and James E. Sutton
The state is responsible for maintaining law and order in society and protecting the people. Sometimes it fails to fulfill these responsibilities; in other cases, it actively harms people. There have been many instances of political corruption and state crime throughout history, with impacts that range from economic damage to physical injury to death—sometimes on a massive scale (e.g., economic recession, pollution/poisoning, genocide). The challenge for criminologists, however, is that defining political corruption and state crime can be thorny, as can identifying their perpetrators—who can often be collectives of individuals such as organizations and governments—and their victims. In turn, pinpointing appropriate avenues of controlling these crimes can be difficult. These challenges are exacerbated by power issues and the associated reality that the state is in a position to write or change laws and, in essence, regulate itself. One possible solution is to define political corruption and state crime—as well as their perpetrators and victims—as broadly as possible to include a variety of scenarios that may or may not exhibit violations of criminal law. Likewise, a resolution to the issue of social control would be to move beyond strictly institutional mechanisms of control. Criminological research should further elucidate these issues; it should also, however, move beyond conceptual dilemmas toward (a) better understanding the processes underlying political corruption/state crime and (b) illustrating the broader ramifications of these crimes.
A considerable body of research on societal response to white-collar and corporate crime has evidenced a hardening of public attitudes, including increased perceived seriousness of upper-class criminality and punitiveness toward its perpetrators. These findings suggest that, over time, the public has gained a better understanding of white-collar crime and its deleterious social impact. However, none of the opinion surveys included a direct measure of public knowledge. As a result, it is difficult to determine to which extent U.S. citizens are objectively informed about crimes of the powerful. In fact, only a few studies have focused exclusively on the intersection between knowledge about white-collar crime and sentiment toward it. These scholarly efforts have concluded that the American people continue to underestimate the actual financial and physical consequences of white-collar crime, which may be the result of selective reporting by the mass media and biased research foci by scholars. By choosing to focus on traditional criminal law violations, such as homicide and theft, and relegating white-collar offenses to the rank of victimless crimes, journalists and criminologists have contributed to the construction and propagation of myths about upper-world criminality. In turn, continuous adherence to these myths might lead to polarized opinions about which type of penal policy to adopt against white-collar crime.
Gerald Cliff and April Wall-Parker
As far back as the 19th century, statistics on reported crime have been relied upon as a means to understand and explain the nature and prevalence of crime (Friedrichs, 2007). Measurements of crime help us understand how much of it occurs on a yearly basis, where it occurs, and the costs to our society as a whole. Studying crime statistics also helps us understand the effectiveness of efforts to control it by tracking arrests and convictions. Analysts can tell whether it is increasing or decreasing relative to other possible mitigating factors such as the economy or unemployment rates in a community. Politicians can point to crime statistics to define a problem or indicate a success. Sociologists can study the ups and downs of crime rates and any number of other variables in the society such as education, employment rates, ethnic demographics, and a long list of other factors thought to affect the rate at which crime is committed. Property value is affected by the crime rates in a given neighborhood, and insurance rates are said to fluctuate with the ups and downs of crime.
Analyzing any criminal act’s prevalence, cost to society, impact on victims, potential preventive measures, correction strategies, and even the characteristics of perpetrators and victims has provided valuable insights and a wealth of useful information in society’s efforts to combat violent/index crimes. This information has only been possible because there is little disagreement as to exactly what constitutes a criminal act when discussing violent or property crimes or what has come to be grouped under the catch-all heading of “street crime”; this is decidedly not the case with crimes included under the white-collar crime umbrella.
Studies of white-collar crime have largely focused on the crimes and immoral and unethical actions of adults during the course of their legitimate occupations, yet adults are not the only offenders, and white-collar crimes don’t always require employment. By narrowing the focus to who can offend, we may miss out on a fuller understanding of the phenomenon. The specific category of “white-collar delinquency” has been proposed to address this gap in the research. The original conceptualization of white-collar delinquency focused on crimes of juveniles that are of major financial and social consequence. The concept largely focuses on computer crimes, fraud, and crimes of skill, including piracy, securities fraud, espionage, denial of service attacks, hacking, identity fraud, dissemination of worms and viruses, and other crimes that can result in serious economic harm. Just as juveniles engage in conventional street crime offenses as do adult offenders, they also possess the ability to engage in white-collar offenses as do adult offenders, and there is a need to study the two age groups separately, as motivations, influences, and opportunities may differ.
The literature thus far has largely ignored juvenile involvement in white-collar crimes due to the nature of the phenomenon, the reliance on offender-based definitions, and the presumption of opportunities to engage in the actions. Some white-collar offenses that were historically committed exclusively by adults have a place in the juvenile community as well. This “migration” has taken place for a number of reasons, with the majority of them closely tied to the nearly limitless access juveniles currently have to technology. Due to the overwhelming popularity of personal computers in homes and marked advancements in technology, opportunities for hybrid white-collar crimes (e.g., credit card fraud, identity theft, hacking, phishing, general fraud, intellectual property theft, financial/bank fraud) have dramatically increased, yet criminological studies focusing on technology related crimes have, until recently, been relatively sparse, and studies of fraud have predominately focused on characteristics of the victims as opposed to the offenders. As access to computers and the internet grow, so too do opportunities to engage in these types of crimes. Juveniles are able to interact with others from the privacy of their own homes with the benefit of complete anonymity. This anonymity may contribute to the appeal of computer-related delinquency, as such acts involve almost no confrontation and no violence, and are individualistic in nature. These individualistic crimes may attract those who would normally avoid more conventional crimes that involve confrontation. Technology has opened the door for a new type of offender and new types of offending.
Although it is difficult to identify an exact dollar amount, financial losses from serious computer crimes such as audio, video, and software piracy; security breaches; and intellectual property theft are likely to exceed the financial losses from conventional crimes, and it is therefore imperative that more attention be given to these types of crimes and perpetrators. Theoretical explanations for this new category of crime have not yet been fully explored for many reasons. First, technology advances much faster than the laws regulating behavior. Second, apprehension and prosecution for crimes of technology are relatively low, and thus little data exists for theory testing with these crimes and offenders. Finally, computer and technology crimes fall into a gray area; they are not necessarily either property crimes or traditional white-collar crimes. In criminology, computer crimes tend to fall into a “hybrid” or “other” category of white-collar crime and as such are often ignored in studies on white-collar crime. Furthermore, juveniles are often overlooked in white-collar crime research due to their status and limited access to opportunity. By proposing the term “white-collar delinquency,” researchers hope to bring more focus to the understudied topic of juveniles engaging in crimes of serious economic consequence.
Rachel Boratto and Carole Gibbs
Wildlife crime is an area of study typically defined from a legalistic perspective as an act in contravention of laws protecting wildlife. These crimes occur both within and across national borders and may include trafficking in wildlife or wildlife products. Internationally, wildlife crime is regulated by a series of conventions, with CITES being the most important for the regulation of trade. While these conventions are international in scope, they must be administered by signatory nations through domestic laws. Domestic laws are enacted within local contexts and are as varied as the crimes themselves, regulating hunting, transportation, use, and sale of wildlife. Several international organizations (e.g., INTERPOL) facilitate collaboration between countries, but these organizations do not have law enforcement authority, so enforcement occurs primarily at the domestic, state, and regional level, following the domestically enacted law.
Scholars have taken a variety of approaches to define and understand various types of wildlife crime and criminals. Some have used a stage-based approach to develop typologies of wildlife crime based on the location of the crime or the criminal within the supply chain, while other criminal typologies are based on underlying motivations. In addition to typological approaches, more general theoretical frameworks (e.g., opportunity theory) have been used to explain these motivations and drivers of crime. More broadly, wildlife crime can be situated and understood within overarching theoretical perspectives, including Green Criminology and Conservation Criminology. Green criminologists define wildlife crime in terms of harm to animals, regardless of whether the act was against the law, and examine how power and inequality produce these harms. Conservation Criminologists, on the other hand, advocate taking an interdisciplinary approach to systematically define and understand environmental risks, including those related to wildlife.
The diversity of perspectives and approaches has produced a wildlife crime literature that is extremely varied, ranging from research on hunting and poaching to trafficking and enforcement. The continued pursuit of novel theoretical perspectives and methodological practices is necessitated by persistent criminal threats to wildlife, particularly to endangered species. Scholar must therefore continue to develop, test, and refine theory and methodological approaches in order to empirically guide wildlife conservation strategy.
Women and white-collar crime is a topic that has, overall, received little attention in the literature. Initially, women were omitted from discussion and research because of their lack of participation, though some early commentary focused on victimization. When Edwin Sutherland first drew public and academic attention to white-collar crimes, few women were employed in positions that were conducive to commit elite crimes related to occupations or professions. According to Sutherland, white-collar crime involved professional men in positions of trust. From 1939 until the 1970s, work on white-collar offenders and offenses was male-centric, which included both scholarly researchers who were exploring the topic and males committing the majority of crimes. Corporations and respected professionals, not women, were presented with a multitude of opportunities to engage in white-collar crimes with little or no serious consequences. Primarily male corporate executives, politicians, and medical professionals committed white-collar crimes that included, for example, activities such as price fixing, insider trading, bribery, insurance fraud, and Ponzi schemes.
Women, who lacked opportunity outside the private sphere of the home, were less involved in crime overall and certainly were in no position to commit white-collar offenses. In the 1940s and 1950s, female crime was typically viewed as promiscuous, aberrant, and male-like behavior. Eventually, in the mid-1970s as more women moved into the public sphere seeking employment, early predictions by female scholars suggested that an increased involvement in white-collar crime was inevitable. The types of crimes committed by women, as noted by pioneering female scholars, were likely to expand beyond prostitution, check kiting, and shoplifting to white-collar offenses as opportunities became increasingly available in the public sphere. Gender inequality in most criminal endeavors continues to exist and more recent debates continue about the role of women in white-collar crime.
Steven Tombs and David Whyte
From the best estimates we have, workers die as a result of health and safety crimes at perhaps 70 times the rate of people who are murdered and perhaps 15 times the rate of people killed in car accidents. Yet health and safety crimes are not the typical subject matter for criminology simply because they are not interpersonal crimes. Yes, individuals are involved, but health and safety crime always requires us to look beyond individual actors playing out a criminal event in a self-contained crime “scene.” This chapter provides a detailed overview of how safety crimes might be regarded as crimes of violence, and explores in detail the way scholars have characterized the regulation of those crimes. It closes by providing a theoretical and empirical description of the “political economy” approach to understanding safety crimes with reference to the case of a young English worker, Simon Jones, who was killed at the hands of his employer.