Chapter 10

1. Chapter 10 White-Collar and Organized Crime

2. Introduction • White-collar crimes – criminal offenses committed by people in upper socioeconomic strata of society, usually in the course of the occupation or profession of these people. • These include: antitrust violations, bid rigging, price fixing, money laundering, insider trading, and tax fraud.

3. Introduction Continued: • Organized crime – offenses committed by people who conduct their business through illegal enterprises.

4. Legal Principles Governing White-Collar Crimes • Scope of Authority – corporations are held criminally liable for the acts of their agents committed within the scope of an agent’s authority within his office or employment.

5. Common Federal White-Collar Crimes • Sherman Antitrust Act – makes it a crime to enter any contract or engage in any combination or conspiracy in restraint of trade. This act protects and preserves a system of free and open competition. To prove a criminal violation of the act the government must establish: • 2 or more entities formed a combination or conspiracy • combination or conspiracy produces an unreasonable restraint of trade or commerce • restrained trade or commerce is interstate in nature • defendant’s general intent to violate the law

6. Common Federal White-Collar Crimes Continued: • Computer Abuse Amendments Act – it is a crime to knowingly cause the transmission of a program, information, code, or command in interstate commerce with an intent to cause damage to a computer exclusively used by a financial institution or the US government. • Also a federal crime to knowingly with intent to defraud produce, use, or traffic in counterfeit access devices which include cards, plates, codes, and electronic serial numbers, etc..

7. Common Federal White-Collar Crimes Continued: • False Statement Act – federal statute making it a crime for a person to knowingly make a false and material statement to a U.S. government agency to obtain a government benefit or in connection with performing work for the government. • False Claims Act – federal statute that makes it unlawful for a person to knowingly present a false or fraudulent claim to the U.S. government.

8. Common Federal White-Collar Crimes Continued: • Mail Fraud – scheme devised or intended to defraud or to obtain money or property by fraudulent means and the use or causing to use the mails in furtherance of the fraudulent scheme. • Money Laundering Control Act – 1986 act of Congress prohibiting the act of disguising illegal income to make it appear legitimate.

9. Common Federal White-Collar Crimes Continued: • Securities and Exchange Act – 1934 act of Congress regulating the sale of securities in interstate commerce. • Churning – applied to transactions in a customer’s account without regard to the customer’s investment objectives simply to generate commissions for the broker.

10. Organized Crime • Organized Crime Control Act – 1970 federal law dealing with organized crime. Title IX of the act is entitled Racketeer Influenced and Corrupt Organizations, also known as RICO. • The new RICO statute provided for forfeiture of property used in criminal enterprises and permitted the government to bring civil actions against such enterprises.

11. Organized Crime • Enterprise – any individual , partnership, corporation, association, or other legal entity, and any union or group of individuals associated in fact although not a legal entity. RICO was conceived as a weapon for prosecution for organized crime, but it has become the basis of prosecution against the white-collar criminal as well. Prosecutors have difficulty in securing convictions of organized crime leaders. Through RICO a prosecutor can circumvent statutes of limitation and seek to inflict multiple punishment for the same offenses.