Financial Crime Registry: Will it Deter Fraud and Improve Restitutions?

Every state in the United States has a sex offender registry that is publicly available for everyone to see in order to identify people who have been convicted of a sex crime in the past. Could such an approach also prove effective at lowering financial crime rates? A recent article in The Wall Street Journal discusses the creation of a White Collar Crime Offender Registry in Utah. Utah is the first state to implement such a registry, making them, according to the article, the “most aggressive jurisdiction in the country when it comes to publicly shaming financial criminals.” The registry will list first time offenders of financial crime for five years, second time offenders for ten years, and third time offenders will never have the option of being removed. In addition, convicts who fully comply with court orders and pay their restitutions in full will not be added to the list.

How to Avoid Being Asked to Commit Fraud

A recent article in The Economist discusses how to avoid being asked to commit fraud. It can be very uncomfortable if your manager asks you to alter the books or do anything that is unethical. Often there are not only repercussions for committing the fraud (i.e., fines or jail time), but also for not committing the fraud (21% of employees who reported unethical behavior at work said they experienced some form of punishment from their employer). If you refuse to commit a fraud, your manager may choose not to promote you or may even fire you.  Rather than refusing to commit a fraud, the best scenario for an employee would be to never be asked to commit a fraud. A study that was done by Dr. Sreedhari Desai (professor at the University of North Carolina at Chapel Hill) found one approach that dissuades managers from asking employees to engage in unethical behavior.

Volkswagen Cheats the Emissions Test and Gets Caught Big Time

The Volkswagen scandal has been all over the news the past several days (TIME, CNN, Economist). In summary, Volkswagen committed a massive fraud by installing a chip in at least 11 million of their diesel cars that slowed down emissions only when the car was plugged in to the emissions machine. Then as soon as the test was finished and the car was unplugged, the car emitted anywhere from 10 to 40 times the amount of nitrogen oxides than what the test results showed. The amounts emitted normally by the car far exceed environmental regulations in the United States. (For more information on the story, see the video below.)

Even Cancer Research Lacks Integrity

An article in Discover Magazine details some of the practices that occurred for 50 years in cancer research that both slowed and misled cancer research for decades. In cancer research, scientists use cancer cell lines (cells that contain a particular type of cancer) taken from tumors infected with the cancer in order to test possible treatments. The problem is that it is very easy for these cell lines to become contaminated, thereby changing the characteristics of the cell line. For years scientists used contaminated cell lines for their research, with numerous publications occurring based on false lines.