scholarly journals Hypotheses on the causes of financial crime

2019 ◽  
Vol 27 (1) ◽  
pp. 245-257
Author(s):  
Vincenzo Ruggiero
Keyword(s):  
Design Methodology ◽  
White Collar Crime ◽  
Economic Thought ◽  
Financial Crime ◽  
Content Type ◽  
Classical Economics ◽  
Financial Crimes ◽  
Universal Values ◽  
Classical Economic ◽  
And Control

Purpose The purpose of this paper is to examine the aftermath of the 2006-07 financial crisis and attempts to identify a range of causes that were responsible for it and are likely to trigger similar events in the future. The analytical tradition established by the study of white-collar crime provides the background for such an examination, which avails itself of some conceptualisations derived from classical economic thought. Design/methodology/approach Explanations of financial crime can resort to general theories based on allegedly universal values. They can posit the existence of criminaloids, namely, individuals who indulge in illegal practices, or ‘honest fraud’, while not deeming themselves culpable. Anomie and control theory in criminology have highlighted how the causes of financial crime are associated with general criminogenic contexts or with individual propensities or mindsets. This paper adds to the existing perspectives a number of variables that can provide a more nuanced picture of financial crimes. Findings This paper attempts to identify a range of discrete variables that can be termed interstitial in the sense that they can accompany a variety of theoretical hypotheses, locate themselves in the space left in between the different approaches while providing supplementary analytical foci. Ignorance, entitlement, reverse Keynesianism, recklessness, efficiency and the finance curse may offer additional angles from which the causation of financial crime can be observed. Sociological and criminological arguments, in this paper, are interspersed with notions derived from classical economics. Originality/value The originality of this contribution is to be found in its use of different theoretical traditions, establishing a dialogue between social theory, criminology and economic thought.

Criminal minds: profiling architects of financial crimes

2021 ◽  
Vol ahead-of-print (ahead-of-print) ◽  
Author(s):  
Shazeeda Ali
Keyword(s):  
Design Methodology ◽  
Comprehensive Analysis ◽  
Psychological Disorder ◽  
Financial Crime ◽  
Health Issues ◽  
Content Type ◽  
Psychological Attributes ◽  
Financial Crimes ◽  
Reduction Strategies ◽  
Risk Reduction Strategies

Purpose The purpose of this paper is to construct a profile of a financial criminal, with special emphasis on their psychological attributes. The objective is to determine if such a profile can provide a valuable tool for detecting perpetrators of financial crime and for implementing risk-reduction strategies. Design/methodology/approach The approach involved a review of various personality disorders and other mental health issues, as well as an analysis of a number of cases involving serious financial crime, to ascertain whether the behaviour of the perpetrators was consistent with certain psychological challenges. In addition, the study examined various motivators for the commission of the financial crime. Findings The research revealed some key commonalities among the perpetrators of financial crime and that their behaviour was often consistent with that of a person afflicted with a personality or other psychological disorder. Originality/value The study provides a comprehensive analysis of various personality and other psychological challenges afflicting a number of offenders involved in financial crime. It also provides some critical findings that could be valuable for those charged with establishing measures to prevent and detect financial crime.

Financial crime – is there any way out of the theoretical deadlock?

2017 ◽  
Vol 24 (4) ◽  
pp. 529-540
Author(s):  
Paul Eisenberg
Keyword(s):  
Design Methodology ◽  
State Of The Art ◽  
White Collar Crime ◽  
White Collar ◽  
The State ◽  
Financial Crime ◽  
Content Type ◽  
The Past ◽  
Financial Scandals ◽  
Research Questions

Purpose This paper aims to approach fundamental topics of financial crime and the law. What does constitute financial crime? Which field of law is best suited to address the threats of transgression by financial executives? What does motivate highly rewarded financiers to become white collar criminals? Design/methodology/approach To answer these research questions, contemporary theories of criminology in general and of white collar crime in particular, as well as theories on motivation, are critically discussed. Benefits and limitations of the theories in use are exemplified on the background of the London Interbank Offered Rate (LIBOR) scandal. Findings The paper criticises that the state-of-the-art theories are not able to embrace financial criminality in its entirety. A provoking pace for further research might be that of psychopathic disorders among white collar criminals. Thus, white collar crime maintains its challenging character. Originality/value This paper provides a thorough testing of multidisciplinary theories that emerged over the past decades against the recent LIBOR scandal. The research questions addressed and the methodologies applied provide a framework for the assessment of the prevailing theories against other financial scandals.

Stealing from the boss: who is looking?

2016 ◽  
Vol 23 (3) ◽  
pp. 613-623
Author(s):  
Peter John Lenz ◽  
Adam Graycar
Keyword(s):  
Design Methodology ◽  
White Collar Crime ◽  
Listed Company ◽  
White Collar ◽  
Lessons Learned ◽  
Corporate Fraud ◽  
Content Type ◽  
Secondary Sources ◽  
Occupational Fraud ◽  
And Control

Purpose The purpose of this paper is to discover organisational governance lessons that emerge from the unique facts and characteristics of one significant corporate fraud in Australia. Design/methodology/approach Data were triangulated between a primary loss adjustment file with multiple commercial and legal secondary sources. The data were analysed and conclusions were inductively drawn as part of a master’s degree research project. Findings White-collar crime takes many forms but it is rare for a medium-sized ASX listed company to be defrauded of Aus$22 m without anybody noticing. Narrative findings reveal the dynamics of the fraud and the weaknesses in corporate governance. This paper outlines the processes of detection and control. It provides several lessons for organisational governance that could prevent similar occupational frauds in the future. Research limitation/implications This unique fraud case has facts which are not necessarily typical of fraud in general. Anonymity in the case seeks to preserve the identities of the parties, but may in fact limit the potential for transparent discussion. Social implications While detecting and investigating occupational fraud has benefits for practitioners and commentators, there are extensive direct and indirect social costs associated with this case. Originality/value The value of this case lies in revealing details of how a significant fraud was perpetrated so that fraud investigators, accountancy professionals, academics and students can benefit from lessons learned.

Financial crime, corruption and tax evasion: a cross-country investigation

2018 ◽  
Vol 21 (4) ◽  
pp. 545-554 ◽  
Author(s):  
Ines Amara ◽  
Hichem Khlif
Keyword(s):  
Money Laundering ◽  
Tax Evasion ◽  
Design Methodology ◽  
Positive Relationship ◽  
Policy Implications ◽  
Financial Crime ◽  
Content Type ◽  
Financial Crimes ◽  
Cross Country ◽  
The Relationship

Purpose This paper aims to examine the relationship between the financial crime and tax evasion and tests whether corruption moderates such a relationship. Design/methodology/approach Tax evasion measure is based on Schneider et al. (2010). Financial crime is collected from Basel anti-money laundering (AML) report. Findings Using a sample of 120 countries, the authors find that the level of financial crime is positively associated with tax evasion. When testing for the moderating effect of corruption, they document that the positive relationship between financial crime and tax evasion is more pronounced for high corrupt environments. Originality/value The findings have policy implications for governments aiming to combat tax evasion and financial crimes.

The establishment of the OECD Asia-Pacific academy for tax and financial crime investigation

2020 ◽  
Vol 28 (4) ◽  
pp. 541-554
Author(s):  
Akira Matsuoka
Keyword(s):  
Law Enforcement ◽  
Design Methodology ◽  
The Other ◽  
Historical Background ◽  
Asia Pacific ◽  
Financial Crime ◽  
Content Type ◽  
Financial Crimes ◽  
Crime Investigation ◽  
Long Time

Purpose This viewpoint paper has two purposes: One is to argue that the Academy activities should increasingly be promoted and used for disseminating the practical and useful skills for the related law enforcement people who fight against financial crime, while the other is to contribute to the basis of discussions and further academy research. Design/methodology/approach This study summarizes and indicates potential usefulness of the new academy, specializing in the related social and political contexts in qualitative and descriptive ways. Findings This study indicates that the new academy activities in Japan would continue for a long time, thus providing immediately useful skillsets for the investigators and officers at the very frontline who face against various financial crimes. Originality/value While little research has been done about the series of related academy activities by OECD, this study describes the historical background and usefulness of the academy of the OECD in a specialized manner, thus showing its linkage with FATF.

Unearthing money laundering at Brazilian oil giant Petrobras

2019 ◽  
Vol 22 (2) ◽  
pp. 400-406
Author(s):  
Lucas Maragno ◽  
José Alonso Borba
Keyword(s):  
Money Laundering ◽  
Design Methodology ◽  
Financial Crime ◽  
Content Type ◽  
Key Points ◽  
Financial Crimes ◽  
State Agents ◽  
Brazilian History ◽  
Practical Implications ◽  
Allowed State

Purpose This paper aims to provide an overview of key points pertaining to financial crimes taking place during the single largest fraud scandal in Brazilian history. The authors provide details on how the historic fraud was carried out at Petrobras, as well as an overview of recent anti-money laundering regulation in Brazil. Design/methodology/approach The paper is based on an analysis of the scandal and on legal ramifications enacted by the prevailing Public Ministry taking place through the “Lava Jato” operation. Findings Fraud perpetrators continue to find new ways to move laundered money into campaign finance. The authors provide details on how the scheme was perpetrated at the placement, layering and integration stages. Research limitations/implications This study comprehends the first stage of the Federal Police’s operation, comprising 14 allegations of financial crimes. Practical implications A disconnect between regulations in effect and the reality of money laundering in Brazil over several years has failed to impede numerous cases of fraud. However, changes in legislation have allowed state agents to discover cases of fraud, with more and more wrongdoings being investigated. Originality/value The Petrobras fraud, individual experiences of organized financial crime and a widespread lack of understanding of how to detect and prevent fraud on this scale.

Moving in the right direction to fight financial crime: prevention and detection

2018 ◽  
Vol 25 (2) ◽  
pp. 362-368
Author(s):  
Fitriya Fauzi ◽  
Kenneth Szulczyk ◽  
Abdul Basyith
Keyword(s):  
Literature Review ◽  
Money Laundering ◽  
Financial Institutions ◽  
Design Methodology ◽  
Asia Pacific ◽  
Financial Crime ◽  
Content Type ◽  
Financial Crimes ◽  
The Right ◽  
Financial Intelligence

Purpose The purpose of this paper is to identify current measures taken for financial crime’s prevention and detection in the context of Indonesia. Design/methodology/approach This study is based on data from articles in Indonesian newspapers relating to the current financial crimes, current measures of preventing financial crimes in Indonesia and based on the literature review. Findings There are some attempts to combat financial crimes in Indonesia, both internally and externally. The attempts that have been made for the internal scope are the enactment of anti-money laundering law, the new monitoring system of financial institutions and the formation of a superintendent institution. The attempts that have been made for the external scope are the agreement between Indonesia’ financial intelligence unit Pusat Pelaporan dan Analisis Transaksi Keuangan (PPATK), and other countries’s financial intelligence unit, the affiliation member of the Asia/Pacific Group on Money Laundering (APG) to combat financial crimes through strengthening its anti-money laundering and terror financing capabilities. Originality/value This paper presents an overview of current prevention and detection measures in the context of Indonesia, and it is hoped that this paper will contribute to the current discussion of eliminating financial crimes.

Testing the fraud triangle: a systematic review

2019 ◽  
Vol 27 (1) ◽  
pp. 172-187 ◽  
Author(s):  
Emily M. Homer
Keyword(s):  
Systematic Review ◽  
Criminal Behavior ◽  
Design Methodology ◽  
Empirical Studies ◽  
Financial Crime ◽  
Fraud Triangle ◽  
Content Type ◽  
Financial Crimes ◽  
Different Types ◽  
Criminal Behaviors

Purpose The purpose of this study is to examine the existing literature on the fraud triangle. The fraud triangle framework, popularized by Donald Cressey and W. Steve Albrecht, has been used to explain financial crimes since the 1940s. The theory includes that workplace financial crime and fraud occurs only when an offender has sufficient opportunity, pressure and rationalization to commit the crime. The fraud triangle has been empirically applied to the array of criminal behaviors and specific financial crimes and offenders internationally to determine if all three elements are necessary for the crimes to occur. Design/methodology/approach This systematic review summarized 33 empirical studies that have applied all three components of the fraud triangle to study financially criminal behavior committed by both corporations and individuals. The review included published and non-published papers and manuscripts from a variety of sources internationally. Findings Of the 33 studies included, 32 found support for at least one element of the fraud triangle and 27 found support for all three elements. Overall, these studies have shown that the fraud triangle has generally received support across different subjects, industries and countries. Research limitations/implications This research only examined papers using the “fraud triangle” term. Originality/value This paper systematically reviewed different types of studies internationally, concluding that the fraud triangle is largely valid internationally as an explanation for financial crimes.

Role of money mules in money laundering and financial crimes a discussion through case studies

2020 ◽  
Vol 27 (3) ◽  
pp. 911-931
Author(s):  
Muhammad Subtain Raza ◽  
Qi Zhan ◽  
Sana Rubab
Keyword(s):  
Case Studies ◽  
Money Laundering ◽  
Design Methodology ◽  
Internet Usage ◽  
Financial Crime ◽  
Content Type ◽  
Financial Condition ◽  
Financial Crimes ◽  
The World

Purpose This paper aims to explain the role of money mules in money laundering and financial crimes through the discussion of case studies. The authors also explain the red flags of money mules and provide advice. Design/methodology/approach The authors use a case analysis approach. The paper mainly discusses ten cases about the use of money mules in financial crimes. Findings It has been found that money mules help criminal syndicates to remain anonymous while moving funds around the world. The unemployment, internet usage involvement of teenagers and youth in money laundering-related crime around the world are on a rising trend, and criminals are constantly looking for their victims by exploiting their mental and financial condition. Originality/value This paper provides case studies to understand the role of money mules in money laundering and financial crime.

Trend and pattern of economic and financial crimes statutes in Nigeria

2019 ◽  
Vol 26 (4) ◽  
pp. 969-977
Author(s):  
Osaretin Aigbovo
Keyword(s):  
Design Methodology ◽  
Financial Crime ◽  
General Direction ◽  
Content Type ◽  
Financial Crimes ◽  
Modern Economic

Purpose The purpose of this paper is to examine the general direction and pattern of modern economic and financial crimes statutes in Nigeria. Design/methodology/approach This paper examines Nigerian economic and financial crime statues. Findings This paper identifies the trend and features, which are common to all the statutes irrespective of economic and financial crime covered by them. Originality/value This paper shows that although Nigerian economic and financial crimes statutes have evolved gradually from Military era Decrees, and target different aspects of economic and financial crimes, there are certain features, which are common to all of them.

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