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Crimes of the Powerful: White Collar, Corporate, and Organized Crime Understanding Criminology 10th March 2009.

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Presentation on theme: "Crimes of the Powerful: White Collar, Corporate, and Organized Crime Understanding Criminology 10th March 2009."— Presentation transcript:


2 Crimes of the Powerful: White Collar, Corporate, and Organized Crime Understanding Criminology 10th March 2009

3 Lecture Outline White Collar Crime –Definitions –Typologies Corporate Crime –Definitions –Typologies Impact of White Collar Crime (In)Adequacy of mainstream criminological theories

4 White Collar Crime General sense: –A variety of offences committed by powerful people or organizations –Offences are enabled by legitimate activities Specific Sense –Offences carried out by individual people in the course of their employment, often against employers

5 Edwin Sutherland (1941) White Collar Crime “crime committed by persons of high social status and respectability” a critiques of criminology’s focus on low-status criminality: –‘hidden’ / non-crime status of middle class criminality crime defined in terms of harm on victims / society Questions raised about criminal status and social class

6 Types of White Collar Crime Individual offences –Against employer Theft, fraud –Against customer Overcharging, fraud, identity theft, various “e-crimes” –Against employee Theft, embezzlement –Against other companies Insurance fraud –Against the State Tax evasion, benefit fraud

7 Corporate Crime Illegal actions, or omissions, resulting from deliberate decision making, or culpable negligence on the part of a company Organizational Goals central to understanding corporate crime Indifference to outcome of action often contributes

8 Jeffrey Reiman “The Rich Get Richer: The Poor get Prison” The Social Construction of Crime –The construction of ‘crime’ focuses attention onto the social harm perpetrated by the poor, and away from those (more damaging) harms perpetrated by corporations –“Typical” criminal: young, urban, poor and ethnic minority –A distortion of harms: “a carnival mirror”

9 How is this social construction achieved? 1.Legislative definitions of crime 2.Police and prosecutor priorities 3.Judges and jury decisions 4.Sentencing 5.Media reporting of ‘crimes’ and ‘accidents’ Each of these stages are inter-related

10 Impact of corporate crime? Occupational Disease and Injury Crime (x ½) Death 54,9288,250 Other Physical Harm 2,300,000425,000 Source: Bureau of Labor Statistics 2003; National Crime Victimisation Survey Note: Crime Rate halved to enable direct comparisons: workforce accounts for half the general population

11 Victims of Corporate Crime Employees Customers The Environment

12 Ford Pinto

13 Ford Motor Company internal memorandum: "Fatalities Associated with Crash-Induced Fuel Leakage and Fires" BENEFITS (OF RECALLING AND RETRO-FITTING) Savings: 180 burn deaths, 180 serious burn injuries, 2,100 burned vehicles. Unit Cost: $200,000 per death, $67,000 per injury, $700 per vehicle. Total Benefit: 180 X ($200,000) X ($67,000) + $2,100 X ($700) = $49.5 million. COSTS Sales: 11 million cars, 1.5 million light trucks. Unit Cost: $11 per car, $11 per truck. Total Cost: 11,000,000 X ($11) + 1,500,000 X ($11) = $137 million.

14 Variety of corporate crime Against consumers –Mis-selling: providing goods and services –Car-clocking, counterfeiting, dangerous goods Health and safety offences –Employee, consumer and environment Financial Fraud

15 Impact of Corporate Crime Lethal Corporate Crime A ratio of 7:1 – seven times as many work-placed deaths than homicides (once figures adjusted for risk)

16 Injuries resulting from Corporate Crime Thalidomide –Chemie Grunenthal deliberately falsified test data, and concealed the dangers of the drug Lung Cancer and Passive Smoking Asbestos

17 Financial Costs of Corporate Crime Mirror Pensioners £440 million missing from Daily Mirror pension funds : 30,000 employees / former employees of Mirror Group affected Levi (1987) -Cost of fraud reported to fraud squads: £2113 million -Twice the cost of theft, burglary and robbery that year

18 Other Harms Health Care –negligence, injuries and deaths, drug reactions and interactions Chemical Warfare –pollution, toxic wastes, smoking, food additives, pesticides Poverty –Higher infant mortality, lower rates of health, shorter life expectancy Consumer Safety –Defective Products

19 Problems with “Hidden” Corporate Crime Construction of Official Statistics Media Constructions of the Criminal: ‘Respectable’ v ‘Criminal’ CJS focus on “conventional” crime –Corporate crime largely outside control of Criminal Justice –Most cases emerge from campaigning / whistle- blowing –Crime is seen as individualistic, inter-personal, and finite: much corporate crime does not fit the model

20 Organized Crime The production, supply and financing of illegal markets in good and services Organizations established with criminal intent, though the divide from corporate crime is not always clear Much organized crime is “governmental”: threatening the State’s monopoly of coercion, protection and extraction

21 Range of Organized Criminality Organized theft and sale of stolen goods Protection rackets Markets covering prohibited goods and services –Drugs, illegal drinking, illegal arms, prostitution, people trafficking, gambling, pornography Money Lending Money laundering

22 Themes in the study of organized crime Globalization –Localised ‘firms’ replaced by globalized enterprises Relationship to legitimate businesses –Legitimate business as a “front” –Provision of services to businesses –Legitimate businesses providing services to organized crime (consciously or unconsciously) Opportunities provided by criminalization

23 Problems for Criminology Conceptual –Most of the ‘crimes of the powerful’ challenge mainstream assumptions of what crime is (e.g. victim/offender) Empirical –Evidence of these crimes are much harder to obtain Explanatory –Mainstream theories need adapting, though many can retain relevance –Direct and Indirect Causes Theoretical –Is ‘crime’ the model? Harm?

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