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Corporate Crime - Ethical perspective

Understanding Corporate Crime 

Corporate Crime

corporate crime is a type of white-collar crime committed by individuals within 
their legitimate occupations, for the benefit of their employing organization. It is also called organizational crime.

Corporations use a variety of business methods to commit this fraud, including misrepresentation of books, manipulation of accounting records, obfuscation of debt, corruption, discrimination and so on.

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If we want to reduce the number of violators, we must stop imposing heavy fines on the company. This idea is not as radical as it seems.
First, when I say that there is no corporate crime, I simply mean that a crime is always committed by individual people. With that in mind, you can imagine my best way to reduce this crime: 
First think, when heavy fines are imposed on company, who pays? this is a valid question; why? come with me...

Who Pays For Corporate Crime?

Exactly who pays when a large company is fined for breaking the law? First, the shareholders pay. Many of them are innocent retirees who have invested money in this business and do not know they are breaking the law. 

If the financial situation of the company is damaged by fines. Who doesn't pay? Only criminals - people who decided to break the law.
As i said earlier, All crimes are committed by people, not companies. When a company injects toxins into the environment, one (or more) people choose to do so. People make this decision when a company steals a pension fund or violates employee salaries. People commit corporate crimes, not corporations!

So, how to stop corporate crime?

If you want to stop corporate crime, start by imprisoning people who are involved in this crime, i.e. individual criminal. In our current system, employees typically perform cost / benefit calculations to see if the benefit of certain violations outweighs the sum of the ancillary penalties. Although the laws are broken, they are unlikely to be held personally accountable. Why don't we hold them accountable?

It is appropriate to fine companies for the real costs that crime impose on others. We clean the toxic waste and, in other cases, give it back to the victims. It also means that shareholders have cause for restraint in choosing a board member. However, a "punishment" is nonsense unless it is imposed on individual perpetrators. Force the perpetrator to pay a fine.
Is that a radical idea? I don't think so! Because what do you think is the most likely factor preventing a director from committing a crime, a fine the company pays that doesn't even affect his salary, or ten years in prison? The answer to that gives us the answer to corporate crime.

Types of Corporate Crime 

  • Fraudulent Financial Statements
Fraud in financial statements is exactly what it seems: forging balance sheets, income statements, and cash flow statements to deceive the people who read them. False financial statements are a type of accounting fraud. This can include a variety of crimes, including securities fraud and perjury.
  • Employee Fraud
Employee fraud is a deliberate act in which a position of trust or power is abused through deception. This can affect any company, regardless of size or type, and carries significant risks not only to ultimate profits but also to its reputation.
  • Vendor Fraud
Vendor fraud can be a form of payment fraud in which the information provided by the "seller" is false. The seller's fraud can also take the form of a real legal seller manipulating their price or unknowingly delivering the goods.
  • Customer Crime
Consumer crime is broadly defined as fraudulent business practices that cause consumers to suffer financial or other loss. ... Consumer crime is often accompanied by false promises or allegations made to consumers, and methods that lead consumers directly into making money.
  • Investment Scams
Investment fraud involves the promise of big payments, quick cash, or guaranteed returns.
  • Bankruptcy Fraud
Bankruptcy fraud is a white-collar crime and can take many forms. It can be used to hide assets to prevent their seizure. In bankruptcy proceedings, some people knowingly submit incomplete forms, or submit false information multiple times.
  • Fraudulent embezzlement (Misappropriation of Assets)
Fraudulent embezzlement occurs when individuals responsible for managing a company's assets steal them. Fraud embezzlement involves third parties or employees of an organization who take advantage of their position to steal them through fraudulent activities. It can also be called an internal fraud.
  • Corruption
Corruption is the dishonest or unethical behavior of people in positions of power such as managers or government officials. Corruption can include giving or receiving improper bribes or gifts, double deals, covert transactions, money laundering etc.

Closing remarks

As corporate crimes are difficult to prevent or discourage, especially as they are committed by the elite class of educated people in our society, they are considered more of a threat to our society than local street crimes such as robbery, etc.

Much corporate crime is exposed today. Although done in a calm and business-friendly environment, they sometimes have a negative impact. As i said earlier, start by imprisoning people who are involved in this crime and impose tougher penalties on that person rather than cover-up.

If i talk about india, There are some regularity authorities who look into the corporate crimes like Central Bureau of Investigation (CBI), Central Vigilance CommissionSerious Fraud Investigation Office, Directorate of Enforcement (DOE), etc. 

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