WHITE-COLLAR CRIME IS NOT going away. It is highly profitable, relatively risk-free, and almost socially acceptable. Since these crimes will not just disappear, security managers must find new ways to fight back through prevention, investigation, and prosecution.
White-collar crime probably costs U.S. businesses more than $40 billion each year. Statistics are unreliable, however, because many of these crimes are never reported. White-collar crime is also responsible for a significant loss in productivity that is not reflected in the statistics. Disruption is inevitable after a crime has been committed. Therefore, competitiveness is reduced even more than the numbers indicate.
White-collar crimes are those committed without the use or threat of force and without the risk of physical harm to the victim or the criminal. Also, a person who abuses his or her position for personal financial gain is considered a white-collar criminal. An example of this is an attorney who uses his or her influence to convince a person suffering from Alzheimer's disease to include the attorney in the will as a beneficiary.
Motives of white-collar criminals include a drug, gambling, or upscale lifestyle habit; large medical expenses or past-due bills; revenge against an employer; and just plain greed.
White-collar crimes may be perpetrated by the following:
* Individuals against other individuals. Most of these crimes have been committed by people in a position of authority and control, such as family members, attorneys, real estate, and insurance, agents, conservators, and physicians.
* Insiders against their organization. Internal criminals include business partners, office managers, computer programmers, stockbrokers, and senior executive officers.
* External criminals. External criminals include forgers, counterfeiters, computer hackers, industrial spies, and office supply pirates.
Whether internal or external, white-collar criminals' tactics include trickery, deceit, or misrepresentation. Some familiar schemes are customer impersonations, medical and insurance frauds, real estate and banking swindles, and embezzlements. The crimes may involve forged or counterfeit checks, receipts, business records, or other legal documents, or the criminals may be aided by technologies, such as on-line computer terminals, fax machines, and color copiers.
The white-collar criminal is generally a calculating risk taker who weighs the potential risk against the potential profit. If a criminally motivated person believes that the opportunity to make a profit is greater than the potential risk associated with discovery, it is crime time.
The motivation to commit a crime has increased in recent years as reports have revealed the vast wealth accumulated by tax cheaters and crooked savings and loan officers. This motivation is bolstered by the belief that white-collar criminals usually do not get caught. If they do, the punishment is light, and the social stigma is insignificant.
White-collar crime can have a significant financial payoff, but what are the risks?
Identification. The criminal must be identified in order to be prosecuted. In a society where people often do not look at each other while walking on the sidewalk and where recording a driver's license number on a check is more important than identifying the writer, this is usually a minor issue for external criminals. It is a greater issue, however, for internal criminals.
To help identify a criminal, employees should remember to pay equal attention to all details of any internal or external transaction, including the other employees involved, the transacting employee's level of authority, the customer, the setting, the type of identification, and the payment method used.
Apprehension. If the criminal is identified, the local law enforcement agency is usually responsible for conducting the initial investigation. …