In 1939, the term "white-collar crime" was coined by the American sociologist Edwin Sutherland to define illegal acts committed at the times by higher status individuals and organizations while carrying out legitimate activity. In general, white-collar crimes are non-violent crimes committed primarily in a commercial or corporate context, in which the primary motivation is financial: to obtain or avoid losing money, goods or services, to obtain personal or business economic gain. advantage. These crimes include, but are not limited to, fraud, money laundering, identity theft, bribery, Ponzi schemes, insider trading, and cybercrime. Say no to plagiarism. Get a tailor-made essay on “Why violent video games should not be banned”? Get an original essay Although non-violent in nature, white-collar crimes can affect more individuals than traditional street crimes and can lead to significant financial and emotional consequences. and physical harm to victims. For example, a single scam can wipe out a person's livelihood and savings, or it can cost partners or clients considerable sums of money, which can lead to business closure and loss of jobs for its employees. White-collar crimes are often committed by people such as business owners, managers, employees, associates, and professionals who, in most other circumstances, would be considered ideal role models for society. This then begs the question: why would someone who has so much going for them choose to risk everything they own by breaking the law? According to Donald Cressey's Fraud Triangle, three fundamental principles are required for fraud to occur and these three elements can be used to identify fraud. before they occur or by participating in the reactive investigation process. A typical fraudster first experiences an incentive or pressure, usually financial, and then takes advantage of an opportunity which usually manifests itself as a weakness in control. Finally, the fraudster will rationalize their act by adopting an attitude or mindset that the act of fraud will solve an immediate problem or need. An opportunity is a situation or combination of situations that opens the door to fraud. For white-collar crimes, the opportunity style focuses on the situational factors of the industry, the workers' corporate environment, and the current state of the organization. An initial opportunity presents itself through industry culture, norms and expectations. For example, financial professionals are rewarded for short-term profits. Thus, to maximize their performance-based remuneration, some circumvent existing laws. In the 2017 Wells Fargo scandal, CEO Tim Sloan said his retail banking group implemented an incentive plan that resulted in inappropriate behavior that led thousands of their employees to cheat. The Volkswagen (VW) emissions scandal is a classic example of management's disregard for ethics, which also leads the company to violate safety laws. The second opportunity presents itself through the structure and culture of the company. Increasing business size also increases the likelihood that illegal activities will occur due to gaps and complications in communication and coordination. The ABC typology explains the differences between a bad apple (an individual acting alone), a badbushel (when there are accomplices and therefore collusion) and a bad harvest (when the leaders of the organization engage in corrupt behavior). Bad harvest syndrome can even affect an entire industry, as seen recently in the case of the LIBOR (London Interbank Offered Rate) scandal which tarnished the reputation of many major banks such as Barclays, the Union Bank of Switzerland and the Royal Bank of Switzerland. Scotland, which has engaged in extremely questionable behavior. The materialistic view of business produces a culture in which the desire to obtain more profits can motivate businessmen to perform actions that can harm society. Pride in success can create and promote a culture of tolerance for breaking the law. In 2015, Hans-Dieter Potsch, chairman of Volkswagen's supervisory board, admitted that their tolerance of rule-breaking led to the Volkswagen scandal. Opportunity creates a framework within which deterrence theory, rational choice theory, and general strain theory can take their course as motivation. These theories deal with the decision of whether a crime will be committed based on the situation presented. General deterrence theory is more concerned with preventing the illegal act and focuses more on what happens when the decision maker believes that the risk is greater than the potential reward. While this may be more of a demotivational theory, it still falls under the motivational side of the fraud triangle. Deterrence against white-collar crime comes primarily from prison, but it can also include public humiliation, loss of respect, and the collapse of an entire organization, as in the case of ImClone. Rational choice theory places more emphasis on the motivations that persuade the decision maker to commit the crime. Crimes committed by organized criminals are intentional in nature and illustrate rational choice factors such as the calculation of costs versus benefits. Rational choice theory makes the commission of a crime a decision about the utility of the circumstances. In general strain theory, it explains how individuals who are unable to achieve their economic goals through legal channels experience strain and may try to use deviant means to obtain what they desire. reach. Some tensions or stressors relevant to explaining white-collar crime include the blocking of economic goals, exposure to a range of other economic problems, inability to achieve monetary and statutory goals, and other stress factors. stress at work. Whether these outcomes result in white-collar crime is also influenced by other factors such as the individual's coping skills and resources, social support, social control, opportunities to commit the crime, and the perceived cost and benefits of white-collar crime. Economic tensions can be both individualistic or corporate, where crimes are committed solely for personal gain. The final stage of the fraud triangle is rationalization which also correlates with the justification of the act. Justifications can take many different forms before and after the commission of the crime. When individuals commit crimes, there is cognitive dissonance between moral standards and bad behavior. To bridge this gap, many white-collar criminal offenders use different types of justifications that may occur before the act, as rational choice theory shows, or they may be retroactive, as explained.