This document discusses various perspectives on socio-economic offenses and economic crimes. It provides definitions and theories related to economic crimes, organized crime, white-collar crime, and corruption. Some key points include: - Economic crimes are illegal acts committed for financial gain, such as theft, fraud, and tax evasion. Motives can include pure economic gain or other personal interests. - Leading theories of economic crime include the neoclassical approach that views criminal decisions as rational choices based on risk/reward calculations, and illegal enterprise theory that sees criminal organizations operating like legal businesses. - Organized crime refers to criminal groups that operate over long periods for material benefits through serious criminal acts like drug trafficking. Leading theories are

1. Adv. Vijay Jayshwal
Kathmandu University School of Law
Socio Economic Offenses

2. Perspectives
 The law shapes politics, economies and society in countless
ways and serves as a social mediator of relations between
people.
 When there is offense done to the law, it is called criminality.
Criminality is also dealt with the laws that are made by the
legislature itself.
 Some of the social crimes are murder, rape, man slaughter, child
labor and human inequalities while some of the economic crimes
are forgery, grand theft, organized frauds, credit card frauds, real
estate frauds / mortgage fraud and corruption.
 United States is the country with the maximum number of crimes
(11,877,218 crimes per month) followed by United Kingdom
(6,523,706 crimes per month).
 Globalizations that expand trade, communications and
information, have first- time reached into the lives and affairs of
ordinary people, multinational companies and governments.
 The cross-border flow is the cause for criminal activities,
corruption and tax evasion and is estimated to be over US$ 1
trillion. $3 billion worth money was lost as a result of criminals
swiping copyright protected digital copies of music, movies,
software and games and distributing them through websites,
chat rooms and mass e- mails.

3. ECONOMIC CRIME: THEORY
 It explores three aspects of economic crime: offender
motivations, economic outcomes, and economic
processes.
 The first tradition refers to economic crimes as
illegal acts in which offenders' principal motivation
appears to be economic gain (e.g., Freeman).
 An economic crime is conceived of as any offense in
which individuals or collectivities of
people purposively act in an illegal manner in order to
gain financial returns (e.g., robbery, drug selling, tax
evasion, computer crime, and abuses of economic
aid).
 A second tradition avoids difficulties associated with
trying to infer motives and focuses on illegal acts that
successfully provide offenders with an economic

4.  A third tradition contends that the processes that
lead to criminal behavior are the same as those
that guide consumer behavior in the marketplace.
 This approach informs most theoretical work on
crime offered by economists since the late 1960s.
 Its most cogent statement is found in Gary
Becker's neoclassical or "economic" approach to
explaining crime.

5. Neoclassical or economic approach
 According to this perspective, people choose criminal
over noncriminal alternatives in the same way that
they choose particular strategies when they act as
consumers in the marketplace.
 This theoretical explanation (Becker, 1976) is based
on the following assumptions:
1. People's actions can be understood as rational; that
is, people are naturally motivated to pursue their
own interests and their behaviors can be examined
as attempts to meet these desires.
2. Material gain is a common interest, but it is not the
only, nor necessarily the primary influence in
people's decisions. People have a much richer set
of interests, and the actions they undertake reflect
their attempts to maximize these.

6.  Because they are rational and must make choices,
people can always express preferences between
outcomes and the things they desire (commodities).
 Rationally economic actors prefer more of a desired
outcome or commodity to less, and prefer a lower
cost to a higher one.
 People base their rational decisions on information
they collect.
 People have imperfect memories and often
miscalculate; these attributes can further compromise
their ability to maximize utility.
 The future is not completely predictable. All decisions
are based on expected utilities and have an element
of risk or uncertainty.

7. A MARXIAN THEORY OF
CRIME
 A definition of crime which is oriented to a theory of
human rights. Antisocial behavior, personal as well as
institutional, necessarily must be repressed. I have
elsewhere offered a set of Human Rights which might
be helpful in such a task.
 A secure and significant relationship to the means of
production for every person in the society. This means
jobs for those who can work and resources for those
who are too young or too old.
 Production and distribution must be oriented to
enhance community. This means that communal
accumulation preempts private accumulation. Private
accumulation based on merit should be continued but
not that of exploitation.

8. Organized crime
 The United Nations Convention on Transnational
Organized Crime (UNTOC,2003) does not contain a
precise definition of 'transnational organized crime'.
 Nor does it list the kinds of crimes that might constitute it.
This lack of definition was intended to allow for a broader
applicability of the UNTOC to new types of crime that
emerge constantly as global, regional and local conditions
change over time.
 The Convention does contain a definition of 'organized
criminal group'. In Article 2(a)
 A group of three or more persons that was not randomly
formed;
 Existing for a period of time;
 Acting in concert with the aim of committing at least one
crime punishable by at least four years' incarceration;
 In order to obtain, directly or indirectly, a financial or other
material benefit

9. Applicable Theories

10. Alien conspiracy theory
 Alien conspiracy theory holds that organized crime
is a direct spinoff of a secret society, the Mafia, which
is a single organization centrally coordinated through
a national commission.
 The ‘alien conspiracy’ model is central to the history of
the organized crime debate in the United States.
 This ‘model’ was not developed by scientists, but by
policy makers in the course of public debate. It has
evolved particularly around the dominance of Italian-
American Mafia groups in society.
 The involvement of American citizens of Italian
descent in organized crime is well documented, from
bootlegging and other criminal activities during the
Great Depression to the post-war involvement of
Italian-American Mafia families in New York and other
major North American cities.
 Hence, organized crime is defined as a problem of
‘outsiders’, while neglecting the involvement of

11. Illegal enterprise theory-
 It understands the organization
of criminal behaviour as reflective of specific
environmental factors - market or economic
forces, influencing the motivations of criminals,
how they interact, their perceptions or risk versus
benefit, and the efficiency and efficacy of their
modus operandi.
 Illegal enterprise theory emphasizes the –
sometimes remarkable – similarities between
illegal activities and legal activities. Offenders are
viewed as normal, rational, profit-oriented
entrepreneurs, who are involved in activities that,
though illegal, are driven by the same laws of

12. Bureaucracy Model
 Bureaucracy model- Criminal organisations like the
Italian Mafia are “tightly structured in a hierarchical
manner, resembling the bureaucracy found in the
legitimate economy”.
 Through initiation rituals, recruits are bound to
become brothers of other members and show
altruistic behavior without expecting short-term
reward.
 These status and fraternization contracts guarantee
extraordinary flexibility, as Mafia bosses dispose of
the capacities of members (and even their lives) to
reach their goals.
 It also explains the fact that Mafia groups are
multifunctional entities, which are used by members
to achieve a variety of goals. .

13. Protection Theory
 Protection theory is mainly based on the historical
manifestation of Mafia control over specific territories (e.g.
Mafia control in Sicily since the late nineteenth century)
and over specific licit economic sectors, such as the
building industry in Italy and the dominance of Italian-
American Mafia families in New York, in the building sector,
the waste disposal industry, the Fulton fish market, the
unions, the harbor, et cetera.
 Mafia groups gained control, acting as ‘alternative
governments’, and made profits by taking over two
traditional state monopolies: the use of violence and
taxation. In the international literature, these illegal
operations on legal markets are also referred to as
‘racketeering’.
 These manifestations of Mafia control were often
paralleled by ‘weak states’, Sicily being the main historical
example of absent state control. Other authors refer to
periods of rapid transition, the Soviet Union being the main
recent illustration of rapid change and evaporating
centralized state control that presented opportunities for

14. The Social Network Approach
 Organized crime does not operate within a social
vacuum, but interacts with its social environment;
consequently we should have a thorough
understanding of social ties and social interactions if
we want to explain it.
 The world of organized crime might be characterized
as a kind of ‘jungle’: the financial stakes are high, yet
the rules and mechanisms that regulate transactions
in the licit world are absent: entering into contracts,
paying debts via the official banking system, and – in
case of disagreement – the availability of mediation or
the courts.
 Social relations might also dissolve problems of co-
operation in an environment dominated by distrust,
suspicion, and deceit.

15. The logistic or Situational Approach
 Mainstream criminology traditionally focuses upon
offenders instead of criminal events and criminal
activities.
 The prevailing line of reasoning is roughly that
there is something wrong about offenders who
continue along the path of crime, either in a
biological sense (for example, a lack of self
control) or in a social sense (for example, a lack
of conventional ties or stakes in conformity).
 However, organized crime research shows, first,
that some offenders are quite normal in many
respects, though they are involved in serious
forms of crime; and, second, that not all crimes
are the same or just symptoms of latent

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17. White Collar Crime
 Reportedly coined in 1939, the term white-collar crime
is now synonymous with the full range of frauds
committed by business and government
professionals.
 These crimes are characterized by deceit,
concealment, or violation of trust and are not
dependent on the application or threat of physical
force or violence.
 The motivation behind these crimes is financial—to
obtain or avoid losing money, property, or services or
to secure a personal or business advantage.
 White-collar crime has been associated with the
educated and affluent ever since the term was first
coined in 1949 by sociologist Edwin Sutherland,
who defined it as "crime committed by a person of
respectability and high social status in the course of
their occupation."

18. Bribery and corruption, abuse of
authority
 The Commission for the Investigation of Abuse of Authority
(CIAA) is an apex constitutional body to curb corruption and its
tentacles in the country.
 The constitution of Nepal has empowered CIAA to investigate
and probe cases against the persons holding any public office
and their associates who are indulged in the abuse of authority
by way of corruption.
 CIAA is a distinctive anti-corruption agency in South-Asia, which
plays the role of an ombudsman, investigator and prosecutor as
well. It aims to crack down the corruption issues at national level
with system-based approach.
 It also focuses on detection and punishment of corrupt acts on
the one hand and social, cultural and institutional reform on the
other.
 While performing its duties and responsibilities, CIAA embraces
preventive, promotional and punitive (3Ps) measures to combat
corruption.
 CIAA basically is a law enforcing agency, guided by the principle

19.  Banking Crimes- Banking and Financial Institution
Act 2073
 Money laundering- "Asset (Money) Laundering
Prevention Act, 2008".
 Narcotic Drugs- Narcotic Drugs (Control) Act,
2033 (1976)
 Looting- chapter of Muluki Code, 2074
 Cheating- chapter of Muluki Code, 2074
 Arson- chapter of Muluki Code, 2074
 Cyber offences and
 Counterfeiting- chapter of Muluki Code, 2074