WHITE COLLAR CRIME IN CONTEMPORARY SOCIETY 4TH ED. C.docx

WHITE COLLAR CRIME IN CONTEMPORARY SOCIETY
4TH ED.
CHAPTER 5
GOVERNMENTAL CRIME:
STATE CRIME AND POLITICAL WHITE COLLAR CRIME
Trusted Criminals
Designed by: Jordan Land, M.S.
Governmental Crime: Some Basic CrimesAbuse of power is
perhaps the broadest charge of governmental crime - it has no
fixed meaning
In its broader meaning, abuse of power occurs when the state
assumes and exercises power it ought not to have
The full range of governmental abuses of power entails many
forms of harm, including violations of universally defined basic
human rights
Governmental Crime: Some Basic CrimesA second basic
concept associated with governmental crime is corruption
Political corruption most typically involves the misuse of
political office for material advantage, although it also
encompasses acts undertaken for political advantage
Bribery is probably the activity most closely associated with
political corruption

Governmental Crime: Some Basic CrimesThe concept of
political scandal is important to our understanding of state
crime and political white collar crime
Such scandals are most likely to occur when a basic division of
power exists in society, when a major external threat to society
is lacking, and when politicians violate widely supported norms
about proper conduct in political office
Governmental Criminality on an Epic ScaleAt its most extreme,
anarchism holds that the state is a criminal enterprise
If unjustly depriving people of their property, their way of life,
and their very lives is regarded as criminal, conquests and state
sanctioned wars are governmental crimes of extraordinary scope
Over time, the state became the largest and most efficient users
of violence, a dubious distinction it originally shared with
bandits and pirates
Governmental Criminality on an Epic ScaleWar crimes are:The
use of poisonous gases, biological and chemical weapons,
nuclear weapons, and mines, indiscriminate attacks against
civilians, etc.
Only captured members of the losing side have been brought to
account for war crimes
Most war crimes go unpunished
The Vietnam WarThe U.S. engagement in the Vietnam War was
illegal under U.S. law because Congress never specifically

declared war, which is required by the ConstitutionSome
observers consider the destruction of millions of arable acres
and hardwood forests to be an ecological crime of immense
proportionsNo president, cabinet officer, or other high-level
civilian or military official involved in the pursuit of the
Vietnam War has ever been required to provide a formal defense
for their policy decisions
U.S. Military Activity
in the “New World Order”
More recent U.S. military ventures were all criticized in some
quarters as criminal actions
Despite some history of antiwar mobilization, most
conspicuously during the Vietnam War, the more enduring
theme in American culture has resisted the imputation of
criminality to American acts of war
Forms of State Criminality
Criminal state is when some form of state criminality becomes a
dominant force in the operation of the state
Accusations of state criminality are subjective and likely to
incorporate an ideological dimension
The Criminal StateThe controversial notion of a criminal state
is most commonly applied to the ultimate criminal enterprise
wherein the state is used as an instrument to commit crimes
against humanity

Such as genocideGenocide refers to a deliberate state policy of
mass killing directed at some identifiable group or people
Ethnic cleansing has also been invoked in the recent era to
describe large-scale killing of such groups
The Criminal StateThe Holocaust perpetuated by the Nazis
during World War II is perhaps the single most dramatic, fully
documented, and extreme case of genocide ever
The Nuremberg Trials generated some controversy over the
question of whether the Nazi leaders could be tried by the Allies
when no fully recognized international criminal law existedAnd
whether some of the Nazis’ alleged war crimes were
substantially different from those committed by the Allies
The Criminal StateSince the post-World War II trials, it has
proven difficult to bring perpetrators of genocides and ethnic
cleansing to justice, and much of the world has been quite
indifferent to these events
The United States was one of the few countries unwilling to
endorse the establishment of a permanent International Criminal
Court as a means in the 21st century of bringing perpetrators of
state crime to justice
The Repressive StateA repressive state systematically deprives
its citizens of fundamental human rights
Human rights are rights humans are naturally entitled to - what
the Declaration of Independence so eloquently called “Life,
Liberty and the Pursuit of Happiness”
Until World War I, the matter of human rights was essentially a
domestic concern

The Repressive StateThe United Nations was formed after
World War II, partly in response to the gross and conspicuous
abuse of the most fundamental human rights by the totalitarian
governments of the time
Though the United Nations Universal Declaration of Human
Rights of 1948 identified a long list of fundamental human
rights, the United Nations has not been able to impose these
standards on any government
The Repressive State
The principle motivating factor in the imposition of a repressive
system of government is the extension or retention of power,
often for its own sake
The Corrupt StateCorrupt state refers to a government used as
an instrument to enrich its leadership
Although corruption is thought of principally as a major
function of economic crime against citizens of a
countryCorruption kills when it plays a role in building
collapses during “natural” disasters like earthquakes
Corruption is virtually an institutionalized part of the political
system in some countries
The Corrupt StateWhat accounts for such entrenched patterns of
corruption?Absence of a civil service “work ethic”, extreme
economic inequality, a lack of disciplined leadership, extensive

bureaucratic powers, cultural norms favoring tribal loyalties
over integrity, and the absence of countervailing forces such as
opposition parties or a free pressIf political corruption is to be
diminished, a fundamental transformation of the entire
administrative structure and related cultural norms must take
place
State Negligence State negligence describes a situation in which
“crimes of omission” are committed
The state fails to prevent loss of human life, suffering, and
deprivation that are in its power to preventMalfeasance- doing
something you are prohibited from doingNonfeasance- failing to
do something you are required to doMisfeasance- performing a
permissible act in an improper manner
State Negligence The most serious form of negligent state
criminality involves the unnecessary and premature loss of life
that occurs when the government and its agents fail to act
affirmatively in certain situationsHurricane Katrina has been
characterized as a form of state crime of omission
The concept of state negligence could be extended to include
inadequate or inefficient government responses to poverty in
general, to crime, to environmental degradation, and the like
State-Organized CrimeState-organized crimes are acts defined
by law as criminal and committed by state officials in pursuit of
their job as representatives of the state
Piracy is one of the earliest forms of state-organized crime
Other forms include:State complicity in smuggling,
assassinations, criminal conspiracies, spying on citizens,

diverting funds illegally, etc.
State-Organized CrimeThe U.S. government has had a long
history of direct involvement in overthrowing foreign
governmentsWhile these operations have been justified by a
rhetoric of liberation or national security, there is much
evidence that the interests of Americans businesses were often
at the core of these military venturesIn the modern era, states
have been accused of carrying out state crime terrorism directly
when they engage in massive bombing of civilian populations
The White House and State-Organized CrimeSome of the most
significant state-organized crime in the U.S. has emanated
directly from the White HousePresident Nixon had secret
wiretaps that were used against journalists and government
officials suspected of being disloyal to the White House agenda
in Vietnam and elsewhereThis improper wiretapping scheme
provided a basis for one of the articles of impeachment drawn
up against President Nixon
The White House and State-Organized CrimeThe single most
celebrated case of state-organized crime was the Iran-Contra
Affair
The principal illegality involved was the violation of the Boland
AmendmentProhibited covert aid to the Contras
The Iran-Contra case involved a conspiracy to violate the
Boland Act

The Central Intelligence AgencyThe CIA was created after
World War II to prevent another Pearl HarborIn 1975, a
congressional investigation uncovered clear evidence that the
CIA had periodically violated its own charterNew evidence of
this illegal activity surfaced in 2007The CIA has been accused
of having a rightwing bias and of placing its own interests
ahead of other considerations
The Federal Bureau of InvestigationThe FBI generally enjoyed a
reputation for integrity and high professional standardsAfter
Hoover’s death, it emerged that the FBI had been engaging in
warrantless wiretapping and unauthorized domestic spying for
decadesFrom the mid-1950s on, the FBI had engaged in
extralegal and illegal disruption and destabilization of dissident
political groups though COINTELPRO, the umbrella for various
counterintelligence programs
The Federal Bureau of InvestigationOver many decades, Hoover
maintained secret files on public officials
The FBI has sometimes mounted undercover operations and
used deceitful tactics to produce evidence against powerful and
sophisticated white collar and governmental criminals
Police CrimePolice crime can be a form of state-organized
crime involving the abuse of power and can also be an
occupational crime, primarily corruption
It is not always possible to differentiate between organizational
and personal motivations or objective
Police crime involves:Violations of constitutional rights,
excessive use of force, and related illegal acts to fulfill state or

departmental objectives
Police CrimeThe most serious form of police brutality is the
sometime-fatal misuse of deadly force
Police brutality has rarely been prosecuted and only in recent
decades has this situation improved with the establishment of
civilian review boards, citizen mobilization and more attentive
press
Other forms of police crime include:Perjury, searches without
warrants, false arrests, and tampering with evidence
Political System CorruptionThe electoral process and inter-
party competition in society promotes forms of corruption
Once politicians gain the power of office, they more often than
not attempt to hold on to it
It has never been illegal for politicians to propose, endorse, or
push through policies and programs that still benefit special
interests and constituents, as long as no direct quid pro quo
exists
Corruption in the Electoral Financing Process
We tend to view political corruption in individualistic terms
because it is easier and more reassuring to focus on individual
wrongdoers
The financing of elections and the related practice of legislative
lobbying are two integral parts of the political system that
promote corruption

Corruption in the Electoral Financing Process
Since the federal election financing reforms of the early 1970s,
political action committees (PACs) became a vastly more
important element in the financing of elections
This form of legalized bribery not only gives incumbents an
enormous financial advantage over challengers but has been
demonstrated to influence legislators’ voting records as well
Political White Collar Crime
in the Executive BranchNo U.S. President has been convicted of
using this high office for personal enrichmentMany are alleged
to have engaged in unethical or specifically illegal conduct for
economic gainGeorge Washington was alleged to have engaged
in suspect land deals early in his careerAlthough President
Clinton was accused of various offenses, including perjury,
these charges for the most part did not allege personal
enrichment
in the Executive Branch
Vice presidents have sometimes been targets of accusations of
wrongdoing
Schuyler Colfax (VP in Ulysses Grant’s first administration)
was accused of accepting bribes and was politically ruined even
though he was never formally charged

in the Executive Branch
Many other high-level members of various presidential
administrations have been charged with specific criminal acts
Samuel Swartout was charged with having embezzled more than
$1 million
The complex intersection of big money and major governmental
power on this level generates endless opportunities for
corruption
Corruption in State Government
In the course of the 20th century, 15 sitting American governors
or former governors were indicted or convicted of such charges
as conspiracy, fraud, perjury, bribery, racketeering and income
tax evasion
These charges typically involved accepting stocks or taking
bribes from contractors and others doing business with the state
in return for political favors
Corruption in State GovernmentCorruption on the state level is
hardly restricted to governors
Countless other state and county officials have been charged
with various forms of corruption
During the colonial period, local governors were often guilty of
embezzling, taking bribes, and reserving for themselves the
right to rent out city property and sell liquor for profit
Corruption in State Government
The single most famous example of political machine corruption
is New York City’s Tammany Hall
The Tweed Ring defrauded the City of New York of up to $200

million through vastly inflated purchases and repairs, false
vouchers, fictitious bills and other such devices
in the Legislative BranchJames Madison believed that Congress
was less corruptible than the executive branch in part because
of its large number of members and diluted powerThe Credit
Mobilier affair was the first major public scandal concerning
congressional corruptionSince this Credit Mobilier affair, major
congressional corruption scandals have erupted in the form
of:JunketingDouble billingFree mailing privilege Using
congressional staff for personal purposes
Political White Collar Crime in the Legislative BranchLobbyists
are often at the center of legislative corruption casesTom DeLay
was forced out of his leadership role and Congressional seat
after being indicted for violation of state election laws and for
corrupt dealings with lobbyistsJack Abramoff bilked Indian
tribes out of millions of dollars while showering gifts, free
travel, and donations on Congressmen and other political
officials
in the Judicial BranchThe judicial branch has probably been the
least tainted by claims of corruption, but it has not been free of
such claims
Judges have been charged with many
crimes:BriberyExtortionObstructing justiceIncome tax

evasionEmbezzlementFraudAbuse of authority
in the Judicial BranchMany judges so charged have been forced
to resignOthers have been impeached, censured, or
disbarredSome have gone to prisonJudges are in a position to
abuse their considerable powerBecause judges are relatively
well compensated and enjoy considerable prestige, they have
relatively less to gain and much more to lose by engaging in
criminal conduct
WHITE COLLAR CRIME IN CONTEMPORARY SOCIETY
4TH ED.
CHAPTER 4
OCCUPATIONAL CRIME AND AVOCATIONAL CRIME
Trusted Criminals
Designed by: Jordan Land, M.S.
Retail Crime and Service FraudRetail businesses are often
thought of as victims of crime, whether by pilfering or
embezzling employees, shoplifters, or robbers and burglars
Retail stores engage in a wide range of deceptive and illegal
activitiesFraudulent advertisingIllegal pricing practicesSale of
fraudulently represented merchandisePurchase and resale of
stolen goods

Retail CrimePaul Blumberg has documented illegal and
unethical practices by businesses
He identified other deceptive practices in retail
crimeAdulteration of productsShort weighingBait-and-
switchBar-code pricesCollection of taxes on nontaxable
itemsWage theft
Defrauding Vulnerable PeopleIn a study conducted by David
Caplowitz, he found that the poor were:Being overchargedSold
inferior goodsVictimized by deceptive credit practices,
complicated consumer contracts, and lawsuits threatening wage
garnishment
Despite new laws and consumer affairs initiatives, these
fraudulent practices are hardly extinct
Service Business FraudRepair service businesses have a
notorious reputation for cheating customers
Complaints about auto repairs constitute the largest percentage
of consumer complaints according to the National Highway
Traffic Safety Administration
These frauds include:Highway banditsEstimate
scamsMaintenance hook schemesPart replacement problems
Service Business Fraud
Many consumers are unaware that they have been victimized
When they suspect that they have been victimized, they are
skeptical to report the crime because they do not believe that it

will lead to effective action
All consumers will be “robbed” by unscrupulous retailers and
entrepreneurs
Medical, Legal, Academic & Religious Crime
Profession refers to occupations characterized by higher
education and training; specialized technical knowledge and
skills, and a high degree of autonomy
Semi-professional has been applied to some occupational groups
such as pharmacists and nurses
Some who claim professional status but lack real
autonomyLawyers, physicians, scientists These individuals
work for large corporations
Medical CrimePhysicians are well compensated, are typically
accorded a high level of trust, and exercise unusual power or
professional dominance over patients
Among the specifically illegal and unethical activities
committed by physicians:Fee splittingTaking or offering
kickbacksPrice fixingUnnecessary operationsFalse and
fraudulent billing
Medical Crime as a Violent CrimeThe performance of
unnecessary surgery is the single most disturbing of medical
crimes
The most common forms of unnecessary surgery are:Removal of
tonsils, hemorrhoids, appendixes and uterusesHeart-related
surgeryCaesarean section deliveriesPerforming unnecessary
surgeries can cause paralysis, blindness or other forms of
permanent injury

Medical Crime as FraudMedicaid and Medicare fraud by
physicians have been characterized as an especially “pure” form
of white collar crime because it occurs within the context of
routine occupational activityOverutilization is perhaps the most
common form of medical fraud, and it is especially difficult to
prove and prosecute successfully Specific techniques used in
this fraud are:Ping-ponging, family ganging, steering,
upgrading, code games and unbundling
Legal Crime
Legal crime refers to lawyers engaging in criminal conduct in
the course of discharging their professional duties
It is more common for lawyers to become involved with,
facilitate, or help cover up illegal enterprises while maintaining
primary commitment to the conventional and legitimate tasks of
a lawyer
Legal Crime as Fraud
The intangibility of a lawyer’s work provides special
opportunities for overbilling clients
It is often proven difficult to establish criminal intent in such
cases of alleged fraudulent conduct
Legal Crime as CollusionThe ethics code of the American Bar
Association requires lawyers to keep in strict confidence any
knowledge of a client’s past crimes and prohibits lawyers from
advising or assisting a client in the commission of any illegal or

fraudulent act
A number of major insider trading cases in the 1980s involved
criminal charges against lawyers who passed on privileged
information about pending corporate takeovers
Academic Crime:
Professors, Scientists and StudentsThe fact that professors
engage in less occupationally related crime than do doctors and
lawyers is probably more a function of fewer opportunities for
such activity than a matter of greater personal integrity among
professorsAcademic crimes refer to plagiarism, embezzlement
of university discretionary funds, forgery, claims about
credentials, etc.Plagiarism refers to use or misappropriation of
ideas or words of others without giving them credit
Academic Crime:
Professors, Scientists and StudentsOutright embezzlement is
hardly unknown in the academic environment
Administrators and employees often have better opportunities
than professors to embezzle or obtain improper payments
Some academic researchers have taken advantage of the special
access they have to rare and valuable artifacts and manuscripts
to steal these items and sell them for profit
Academic Crime as Fraud
It has proven difficult to develop reliable data on the extent of
scientific fraud, which principally takes the form of fabricating,
manipulating, and suppressing data

Claims that outright scientific fraud is rare are commonly made,
but whether or not they are accurate have not typically been
based upon scientific research
Student White Collar CrimeStudents commit various illegal acts
that have nothing to do with white collar crime, including
vandalism, drunkenness, illicit drug use, car theft, etc.
Student white collar crime is best defined as illegal or harmful
conduct committed specifically in the context of their student
roleFor gain or advantageThe clearest form is cheating
Student White Collar CrimeColleges are also concerned that
many applicants engage in “résumé fraud” by making false
claims about their achievements and activities
New technology has greatly increased the opportunity for
cheating
Academic cheating takes many forms:Cheating on exams, home
work and term papers
Religious CrimeReligious crime may be the most disturbing of
all forms of crimes by professionals
Religious leaders may generate a bottomless well of trust among
gullible believers
Some religious leaders have defrauded believers and used
offerings or donations for corrupt purposes
Employee CrimeEmployees stealing from their employers is one
of the more common images of white collar crimeWhen

managers steal, losses average $250,000Executives and
managers are often in a position to award themselves huge
bonuses and a wide range of expensive “perks”Clark and
Hollinger define employee theft as:The unauthorized taking,
control or transfer of money and/or property of the formal work
organization perpetrated by an employee during the course of
occupational activity which is related to the employment
Employee CrimeA great deal of employee crime is not readily
discovered
Even when discovered it may not be reported to any official
agency
No agency collects and publishes statistics on the range of
activities encompassed Only rough estimates based on diverse
sources and statistical extrapolations are available for study
Forms of Employee TheftWithholding effort at work can be
viewed as a form of employee crimeEmployees use office
supplies and machinery for personal use, make personal phone
calls on a business phone, etc.Employee theft occurs on a
number of different levels:Pilfering refers to petty
theftChiseling refers to cheating or swindlingFraud is theft
through misrepresentationEmbezzlement refers to the
destruction or fraudulent appropriation of another’s money
which has been entrusted to one’s care
Employers’ Response to Employee Theft
Some employee theft is tolerated, sometimes even encouraged,
by employers to compensate for low wages and poor working
conditions

Workers who engage in it are less well positioned to organize
and make demands
Employers’ Response to Employee Theft
Many employers are unlikely to involve police when they
discover significant employee thefts because:To do so risks
relationships and productive patterns at workExposes improper
or even illegal practices of the employerPossibility of garnering
bad publicity if arrests and criminal trials ensue
Alternative Forms of Employee CrimeTheft of ideas, designs
and formulas are another form of employee crimeSuch theft can
be expected to become an increasingly costly problem in the
current “information revolution”Not all employee crime against
the employer takes the form of theftEmployees may commit
sabotageTo conceal their own errors, to gain time off or for
more pay, or to express their contempt and anger with their
work and employer
Some Factors in Employee TheftAn extensive study of
employee theft found that employees who commit theft are more
likely to be young males, and unmarriedCompany property
refers mainly to basic, bulky components and toolsProperty of
uncertain ownership refers to small inexpensive items like nails,
bolts, drill bits, etc. Personal property refers to monogrammed
clothing, wallets, jewelry, personal modified tools, etc.
Conditions in the Workplace

and Employee CrimeDuring the period of 1750-1850,
opportunities for employee theft became far more widely
available
In the more recent era, technology has facilitated new forms of
employee crime
The most important factors influencing employee theft
involve:Workplace conditions such as the size of the
organization
and Employee Crime
Smigel (1970)found that respondents were more prepared to
steal from large organizations than small ones
An employee stealing from a large organization is far less likely
to suffer measurable harm from conventional levels of theft
The larger the organization, the smaller the risk of being caught
and Employee CrimeOther studies have found that employees’
dissatisfaction with the company or with supervisors was
associated with higher rates of employee theft
Opportunity to steal is a major determinant of employee theft
Those who have the greater access to things worth stealing are
the most likely to do so
Avocational Crime and White Collar CrimeAvocational crime
refers to occasional economic crimes committed by respectable

members of society outside of an occupational context
Avocational crimes are similar to the concepts of occasional
property crime, folk crime and mundane crime
Occasional crime is an amateur, small-scale property theft or
destruction
Avocational Crime and White Collar CrimeFolk crimes apply
to everyday deviance, like traffic violations and
poachingMundane crimes are commonplace, innocuous, and
often dull or routine opportunistic forms of lawbreaking with
relatively low visibilityAvocational crimes include:Evading
personal taxesDefrauding insurance companiesProviding false
statements in connection with personal loans and obtaining
creditStealing servicesStealing copyrighted material
Income Tax EvasionIncome tax evasion is classified as a form
of occupational or individual white collar crimeFailure to
comply with tax law may take different formsFailure to file,
non-reporting of income, underreporting of income, etc.Tax
evasion defined by the IRS is:An act involving deceit,
subterfuge, and concealment. It is, of course, illegalHowever,
tax avoidance, the arraignment of a taxpayer's affairs to
minimize tax liability, is legal
Income Tax EvasionThe complexity of tax law makes it difficult
to distinguish between tax evasion and tax avoidanceIncome tax
provides 2/3 of federal tax revenueThe IRS has been more
vigorous in the pursuit of tax protesters (those advocating tax
evasion) than of tax straddlers (those using illegal tax
shelters)According to one study, the more prevalent an

individual perceives tax evasion to be, the more inclined that
individual will be to commit tax evasion
Other Forms of Avocational CrimeInsurance fraud is widely
recognized to be a growing problem in the U.S.Doctors,
lawyers, insurance adjusters, and the police may be involved in
facilitating false injury, damage and theft claimsMuch insurance
fraud generally is avocational crime committed by respectable
middle or upper class members of societyMuch avocational
crime is less stigmatizing than all forms of white collar crime
because the primary victims are most typically the government
or large corporations, and because the losses appear to be more
abstract than for other forms of theft or fraud

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