White Collar Crimes: The Pyramid Scheme And Ponzi Scheme

Ponzi Schemes also known as a multi-marketing organization are white-collar crime; it is essentially an individual swindling a quick investment from new investors. Always ends up with investors or victums losing “their shirt” all the profits and many cases the company and is bankrupted and the owner ends up in jail. Two very highly successful Ponzi schemes are Primerica group and Amway. Primerica Group sells insurance and financial services and Amway sells heath insurance, but it doesn’t matter what they sale, its all about recruitment. They take your hard earned money and invest it into there business for a bigger profit in the future for a retirement but many people who try to get some of there money back for emergency are sadly mistaken

Both white collar and organized crime involve a system of networks of criminals working in concert, with white-collar crimes being committed to enhance and further the interests of the company through the guise of personal gain, but organized crime main objective is to bring profitable enhancement to the head of the crime group while moving up in the organization.(Humphrey & Schmalleger, 2012) The issues with white-collar crimes is that it is usually committed by a person of respectability and high school status in the course of his or her career, while organized crime is a group of three or more people with the aim of making money (Humphrey & Schmalleger, 2012) White-collar criminals are rarely arrested or punished for their offenses due

Can "white collar" crime be explained by the same theories that address crimes such a domestic theft and burglary?

Usually the head of the ponzi scheme is someone trust worthy like Madoff. “Much of the reason why Madoff fraud went so long unchecked likely had to do with his respectability and reputation for being a market genius”(511). Once again, trust

White Collar crime has been a hot topic since the 20th century. Edwin Sutherland introduced the term at the fourth annual meeting of the Sociological Association. At this meeting he explained who this type of criminal is and what the criminal does for a living. Sutherland developed a theory to try and fit this type of criminal. The theory is differential association. There are four different pieces of evidence to understand the theory. White collar crime ranges from Embezzlement to Mortgage Fraud. This paper will explain several incidents which are involved with white collar crime and how it hurts many individuals from families to businesses. The sentencing guidelines help convict criminals. The Sarbanes-Oxley Act helped add on top of the

Embezzlement or property theft, is when someone sets aside property or money for personal gain when they are entrusted to handle a company's assets or someone else's money/property. When the defendant takes the money for their own personal gain is it considered as stealing. In order to be convicted of embezzlement, the prosecution must prove that the person was in a position of trust and had access to the money and property, even though he was not owner of it. Embezzlement is referred to as form of white collar crime because these crimes occur in the business world by the white collar professionals with high social status.

In this case of Madoff, he started an investment scheme where people invested in the scheme and were promised returns which were higher at a short period of time. Due to the high returns within a short period, many people invested in the scheme where at first he paid them returns as expected but after a time, he diverted investor’s money to make payments to earlier investors and also to himself (McDermott, M. A. (1998). He later disappeared with the investor’s money before they even realized.

An Individual that is in prison is a criminal no matter what type of crime he or she may have committed. There are no boundaries regarding, race, sex nor a social status in crimes. All crimes are the same no matter what type of crime it may be. Most women that are incarcerated are either from middle or lower class families of society. However, no matter what type of crime has been committed, it is the decision of that individual to obtain an education or the ability to learn while incarcerated. Furthermore, reality remains that the extent of comprehension and the degree of information of white collar crimes are being more muddled through the prison system requires some sort of vocational training. This does not imply that a women or a man

A ponzi scheme is a process that can be very successful, but is illegal and can be devastating to its victims. The leader of the ponzi scheme must convince people to invest their money with promises of high return rates. It relies on the constant addition of new investors because the older investors get money from the newer investors (Sallinger, 2013, 571). Bernard Lawrence Madoff ran a very long and successful ponzi scheme before getting caught and arrested in 2008. His ponzi scheme caused great hurt to many people inside and outside of the company.

* A pyramid scheme is an unsustainable business model that involves promising participants payment or services, primarily for enrolling other people into the scheme, rather than supplying any real investment or sale of products or services to the public.[1][2]

What is white collar crime? White collar crime has many types of different crimes. Some types of white collar crimes which are the most common are fraud, embezzlement, tax evasion, and money laundering. The main key factor that makes a crime a white collar crime is based on the fact that the individual does this crime in order to have a financial gain. One type of white collar crime people talks, about the most is a Ponzi scheme. The Ponzi scheme was created by Charles Ponzi. With a Ponzi scheme, the person makes a promise that the investor will have a high rate of return that can’t be found in the stock market. This person provides fake reports claiming the investor is making money when in actuality they are making nothing. One investor’s money is used for another investor’s money to show profit is being made. All the money is actually going to the person that is in charge of the Ponzi scheme. The scheme will grow through word of mouth and more and more people will want to get in, so they too can make a lot of money. The investor can back out at any time they please.

Crime is such a general word, and describes a whole conundrum of activities that are seen as unlawful. The oxford dictionary defines crime as “an action of omission which constitutes an offence and is punishable by law”. There are many different types of crimes, and they are classified based on the seriousness of the crime. Minor crimes/offences, for example a traffic offence, are called misdemeanors. More serious crimes, like murder, are called felonies and are punishable by more than a year in prison. When people hear the word crime, they most often associate it with a dangerous, violent act. There are crimes that are not violent in nature, but are still considered criminal acts because of their nature and their purpose. White-collar crime is one of those types of crimes that are non-violent but have a great impact on its victims.

“Bank robbery is down by half over the last decade, check fraud has declined in recent years, and cyber crime is surging” (Scanio and Ludwig). Fraudulent activity is everywhere. It is a crime even though there are no victims. Scams, price fixing, wiring accounts, fraud of all sorts, etc are all types of white-collar crimes. Not all crimes that are committed are even performed by the Chief Financial Officer. It has become more accessible, to commit these crimes, with the mass amounts of internet and cellular towers available. While the amount of electronic devices have increased so has the amount of cybercrimes. White collar crimes are criminal offences, formed from plans to rob from companies. There have been many in the past with substantial restitution rates, but the controversy is how they rate the crime and the consequences that a specific crime comes with it.

White collar crime is a problem that we do not really see the full extent of; Geis and Stotland (1980) present the argument that the seriousness of victimisation caused by many corporations is much greater than that caused by common crimes however the public seem much less interested and concerned with white collar crime. Some traditional criminological theories have attempted to prove that white collar crime is not a different and separate phenomenon to common, every day crime. Robert Merton’s Strain Theory is applied to everyday crime, however his theory was in fact set up as an economic theory that he believed could explain all types of corporate crimes as well as traditional crimes. Gottfredson and Hirschi also provided what they understood to be a ‘General Theory of Crime’ with Control Theory, which they also believed to be relevant to both white collar and traditional crimes. I am going to discuss these theories in detail and show how they do, and do not provide sufficient explanations of white collar crimes. I am also going to include Organizational Theory in my discussion which looks at the issue of understanding crime in a different way. Traditional theories such as strain theory and control theory form a certain understanding of the issue, on the contrary some argue that these theories are not appropriate and need twisting to fit the issue, some suggesting a completely separate way of thinking is needed to understand white collar and corporate crime.

Scams are happening all around us, and we often don’t even notice them. Pyramid schemes are very harmful towards investors, and are hard to watch out for unless you know exactly what they are, why they fail, the effect of the failure, common victims, how to avoid them, and how to prevent them from spreading. More individuals are hurt than are helped when dealing with these scams. Individuals should be more informed about pyramid schemes, because they can be easily disguised.