Copyright 2010 by South-Western/Cengage Learning Chapter 7 Business Crime

Copyright 2010 by South-Western/Cengage Learning

Chapter 7 Business Crime



Bernard Ebbers – Worldcom


Andrew Fastow – Enron


Richard Scrushy – HealthSouth


Jeffrey Skilling – Enron


John Rigas – Adelphia


Martha Stewart


Samuel WaksalImclone Systems



Sanjay KumarComputer Associates


Calisto Tanzi – Parmalat


Bernie MadoffBernie Madoff


Dennis Kozlowski – Tyco


Copyright 2010 by South-Western/Cengage Learning7-16

Business Crime Business Crime ElementsElements

• Criminal Intent—Scienter or Mens Rea– State of mind required to commit a crime

– For corporations—prove intention on behalf of directors• To prosecute, must show individual intent• Can establish by showing their knowledge

of actions and failure to object



• Case 7.2 United States v Ahmad (1996)– What is the difference between

knowledge of the law and knowledge of the conduct?

– Why is Ahmed’s testimony that he thought he was discharging water significant?



• Actus Reus—The Act of the Crime– Intent alone is not a crime; the act must

be committed– The required conduct described for each

crime– Sometimes a failure to act may

constitute a crime—for example, failure to pay taxes


• The Megan Meier Suicide

• State Crime Statutes

• Still Evolving

• Prevent Postings That Humiliate and Degrade

CyberbullyingCyberbullying


Procedural RightsProcedural Rights

• Fourth Amendment Rights:– Privacy amendment

– Search warrant procedures• Must be based on probable cause• Must be issued by a disinterested magistrate• If searches are done improperly, evidence is

inadmissible at trial


• Fifth Amendment Rights:– Protection against self-incrimination

– Given to natural persons - not to corporations• Corporate officers can assert it to

protect themselves but not corporate records

Procedural RightsProcedural Rights

Documents

Copyright 2010 by South-Western/Cengage Learning Chapter 7 Business Crime