Using Financial Incentives and Income Contingent Penalties to Detect and Punish Collusion and Insider Trading

2005 ◽  
Vol 38 (1) ◽  
pp. 122-140 ◽  
Author(s):  
Bruce Chapman ◽  
Richard Denniss

Collusion and insider trading, being white collar crimes, are often characterised as being victimless crimes. The absence of identifiable victims makes the detection of these crimes particularly difficult. This paper proposes that, in order to increase the flow of information about collusion and insider trading, parties engaged in these crimes should be offered financial incentives to provide evidence against their co-conspirators. In order to provide greater certainty that rewards will be paid, and also to increase the probability that any fines are paid, it is also proposed that an income-contingent fine collection mechanism be utilised. The paper presents two case studies to illustrate how the fine collection mechanism could be used.

Think India ◽  
2014 ◽  
Vol 17 (3) ◽  
pp. 22-24
Author(s):  
Sreekumar Ray

Since inception, the growth of the Indian stock market has been constrained through unethical, illegal and self-actualized activities of swanky persons involved in different capacities in the market. The stock market was trying to retrieve itself from the devastating effect of Harshad Mehta share market scam, when within a gap of ten years it was once again pushed into the darkness of the dungeon by another demon-child of the country- Ketan Parekh. Corporations have been looted by the insider traders, diversifying internal information to an external in lieu of cash. Investigations in the majority cases have proved the involvement of the high ranking officers of the companies in the crime, sophistically referred to as white-collar crime. It has an adverse impact on the growth and sustainability of the share market. Under the light of the above issue, this paper endeavors to study the impact of such crime on the share market. It focuses on the mechanism behind the insider-trading, its impact on the share market and the regulators supervision on the issue. Finally, suggestions have been provided which will contribute towards the dream of every Indian-a fraud-free share market focusing towards the overall development of the country.


2019 ◽  
Vol 24 (6) ◽  
pp. 729-747
Author(s):  
Rudrajeet Pal ◽  
Erik Sandberg ◽  
Manoj Kumar Paras

Purpose This paper aims to purport deeper understanding of, and instigate theoretical elaboration to, multidimensional value created through different reverse supply chain (RSC) relationships. Design/methodology/approach By capturing the relationships (and their differences) constituted and embedded in three “extreme” case studies from global used clothing supply chain, the sources of multidimensional values are explored in line with Dyer and Singh’s (1998) relational theory. Findings In the RSC, when downstream relationships are typically more opportunistic, value is created using inter-personal ways of knowledge sharing and through use of informal safeguards. In contrast, the upstream RSC relationships are more symbiotic, and value is created through more seamless (and routinized) knowledge sharing practices, and additional use of more formal transaction-specific controls or financial incentives as safeguarding instruments. Research limitations/implications The use of consolidated case studies may affect the consistency in the findings presented. Another limitation relates to deriving propositions per each source presented in relational theory. Practical implications Practitioners particularly from industries whose global RSCs include different natures of relationships and multiple value incentives can be benefited through this study. Originality/value The paper extends the original sources of value creation prescribed in relational theory by contextualizing them in RSCs. It depicts how multidimensional values are created relationally by dyadic partners as the nature of relationship differs between upstream and downstream.


2020 ◽  
Vol 20 (1) ◽  
pp. 93-100
Author(s):  
Eun-han Lee ◽  
Waon-ho Yi

The purpose of this study is to extract the current problems of flood damage treatment, which relates towaste from wind and water, and to present waste information and statistical management methods for efficient flood damage treatment through domestic and foreign case studies. Responses to flooding have been found to be inefficient due to systematic and comprehensive statistical data on floods, the absence of basic plans, and a lack of collaboration between waste disposal agencies and local governments. In order to efficiently dispose of flood waste, a system such as providing financial incentives to local governments, is necessary. For systematic planning, a quantitative method of calculating a certain amount of occurrence should be applied. In addition, in order to monitor the implementation of the basic plan, it is thought that systematic and rational statistical surveys need to be continuously conducted.


2017 ◽  
Vol 30 (3) ◽  
pp. 95-115 ◽  
Author(s):  
Seppo Ikäheimo ◽  
Juha-Pekka Kallunki ◽  
Sinikka Moilanen ◽  
Eduardo Schiehll

ABSTRACT We use proprietary archival compensation panel data from Finnish white-collar employees (WCEs) over the period of 2002 to 2011 in order to examine the relationship between performance-based incentives for WCEs and the future profitability of the firm as well as to determine whether this association is moderated by task complexity. While many studies examine the determinants and performance effects of CEO compensation, virtually no evidence has been presented to indicate that explicit financial incentives for WCEs improve the profitability of the firm. Our empirical results show that performance-based incentives for WCEs are significantly positively related to the future return-on-assets, return-on-equity, and profit margin ratios of the firm. We also find that this effect comes from the performance-based incentives for low-level WCEs, corroborating the importance of implementing performance-based incentives also to low-task complexity jobs. JEL Classifications: M40.


Criminology ◽  
2020 ◽  
Author(s):  
Mary Dodge

The inclusion of gender in the field of white-collar crime represents a relatively new and challenging area of study and research. The existing information on this topic is scarce, though research is emerging at a steady pace on women who commit offenses and on victimology. Several reasons explain the lack of attention on women who commit white-collar crime and patterns of victimization. First, historical research on people who commit offenses focused on men because they committed the highest number of crimes. Illegal activities committed by women were viewed as aberrations that rarely occurred. Initial empirical studies and theories in criminology were developed based on young male delinquents who were engaged in the majority of offenses and white-collar crimes remained anonymous deeds that, historically, received little recognition. The trend to study males holds true, despite the rising number of females who have become involved in the criminal justice system. Young boys and men continue to outpace women on almost all criminal offenses. Second, women were engaged in domestic duties that hindered their participation in the workforce. As a consequence of their status as wives, mothers, and homemakers the crimes women committed were related to prostitution, shoplifting, welfare fraud, and embezzlement. Women had few opportunities to commit corporate or occupational white-collar crime. Though women fought to gain equal rights, particularly in the workplace, high-level positions in corporations were rare and the glass ceiling prevented advancement in many companies. Third, until the mid-1970s few feminist scholars were active in the fields of criminology and criminal justice, which stunted growth in the area. Finally, the debates over definitional issues and lack of access to large data sources on white-collar crime stymied research efforts. The problematic nature of deciding what actions constitute white-collar crime emerged almost immediately after Edwin Sutherland’s 1939 presidential address at the American Society of Sociology (later renamed the American Sociological Association). Sutherland argued that a huge portion of crime committed by respectable businessmen in positions of power was being ignored, despite the serious harm caused by their actions. The myopic attention on street-level crime resulted in societal, scholarly, and journalistic failures to acknowledge suite-level offenses and victims. While scholarly efforts to explore white-collar crime grew, the idea that women might be involved failed to emerge until 1975. Incidents of women committing white-collar crime were so rare that fraudulent schemes were the exception to the rule. Scholars noted that low-level white-collar offenses by women, such as embezzlement, may be worth investigating, though many people believed these actions represented pink-collar crimes. The lack of opportunity in male dominated corporate and professional realms resulted in few women who participated in, for example, insider trading, Ponzi schemes, or price-fixing. A few female scholars, however, recognized that the issue was not about gender and the ability to commit white-collar crime, but instead depended on opportunity.


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