WCC Textbook Outline White Collar Crime The Essentials Ch 3 Crimes in Sales Related Occupations A Systems Perspective In sales oriented occupations in particular the likelihood of theft is high Employee Theft in the Retail System Retail system is the setting where consumers purchase various types of products Employee theft in retail settings o Overcharging Employees charge customers more than they should o Shortchanging Employees do not give customers all of their change have and pocket the difference o Coupon Stuffing Employees steal coupons and use them later o Credits for nonexistent returns Employees give credit for returns to collaborators o Theft of production supplies and raw materials Employees steal items used to produce goods in retail settings o Embezzlement Employees steal money from an account to which o Over ordering supplies Employees steal money from an account to o Theft of credit card information Employees steal customers credit o Theft of goods Employees steal the items the retail setting is trying o Theft of money from the cash register Employees take money out they have access which they have access card information to sell of the register o Sweetheart deals Employees give friends and family members unauthorized discounts Prevention strategies o Importation strategies strategies that aim to import only the best types of employees who are less likely to engage in employee theft Ex background checks drug tests etc o Internal strategies include policies and practices performed within the retail setting in an effort to prevent employee theft Ex random inspections audits Random inspections include checking cash registers and employee lockers for evidence of wrongdoing o Technological strategies entail the use of various forms of technology to prevent employee theft in retail settings Ex use of video cameras Closed circuit television has been hailed as the most effective deterrent in retail settings o Organizational culture strategies aim to promote an organizational culture that values honesty and loyalty Supervisors must Provide advice to employers about the organization s culture Build loyalty between the employee and the employer Establish a trusting relationship between workers Eliminate temptations Strong integrity program Four elements Mangers would be held accountable for employees behavior and provided incentives as part of the accountability Managers would ensure that all employees be aware of the rules of conduct in the retail setting An effort would be made to give employees a sense of authority Managers would provide employees an outlet for reporting misconduct o Anonymous reporting systems have been found to be particularly useful in detecting wrongdoing o Awareness strategies focus on increasing awareness among employees about various issues related to employee theft Employees should be exposed to the following Formal codes of conduct Anonymous tip lines New hire orientation Bulletin board posters related to theft prevention Periodic lectures on theft and the consequences of theft Loss prevention compensation programs o Monetary rewards for reporting coworker s theft Crimes in the Entertainment Services System Entertainment services system describes those settings where consumers consume or purchase various forms of services designed at least partially for entertainment or pleasure o Focus is on restaurant and hotel industries In terms of crimes by workers against the restaurant patterns similar to those of employee theft in retail settings are found Factors leading to theft by workers in restaurants o Tend to hire younger workers o Low wages lead to feelings of being underpaid and underappreciated o Part time nature of work workers feel less invested in employer o Erratic hours lead to various opportunities for misconduct Policies and strategies for reducing theft in restaurants o Inventory control o Controlled exits so mangers know when workers are leaving o Inspections of employees belongings o Video cameras o Locks on goods and items o Restricted access to the cash register Hotel Industry Crime types include o Theft of hotel food o Theft of items owned by the hotel o Theft of hotel guests items These crimes are particularly difficult to detect Particularly problematic during summer months when temporary employees are hired consumers Fraud in the Sales Service System Sales service system entails businesses that sell basic goods and series to These basic goods and services are those that most individuals nee in order to function in their communities o Home and automobile Home Repair Fraud Most common types of home repair fraud o Roof repair o Asphalt paving or driveway sealing fraud o House painting fraud o Termite and pest control fraud o Tree pruning and landscaping fraud Usually door to door scams initiated by offender Home repair frauds appear to increase after national disasters The advantage of criminal laws and policies directed toward home repair fraud is that officials have clear guidance on how these cases should be processed o Without these laws these crimes would be handled as civil wrongdoings if at all Auto Repair Sales Fraud Billing for services not provided occurs when auto mechanics bill consumers or insurance companies for services not provided o Industry insiders critiqued the BAR study for being methodologically flawed and for using vague definitions of fraud which included billing mistakes Unnecessary auto repairs occur when mechanics perform mechanical services that are not necessary and bill the consumer for those services o Well planned o Particularly difficult for consumers to detect o Presumably an automotive repair shop will advertise cheap specials as a way to get consumers into the shop and then convince consumers that they need certain repairs Airbag fraud occurs when mechanics fraudulently repair airbags o Two types The first type involves outright fraud in which mechanics clearly intend not to fix the airbag appropriately The second type of airbag fraud is inaccurate repair mechanics simply fail to repair it correctly Auto insurance fraud occurs when mechanics dupe the insurance company into paying for unnecessary or nonexistent repairs o Types Enhancing damages Substituting parts Creating damage This is when mechanics work with car owners to damage a car so that the owner can files claim with the insurance company Ex stripping and vandalizing o Very few academic studies have focused on auto repair fraud o Smaller