Look At These White Collar Crime Examples So You Know How To Prevent Them Happening To Your Business

Look At These White Collar Crime Examples So You Know How To Prevent Them Happening To Your Business

While many companies prefer not to disclose that they have been a victim of while collar crime, this dastardly form of criminality is known to cost American businesses billions, if not trillions every year. Once in a while, a huge case hits the headlines, with scandals rocking entire industries or prompting the creation of new legislation to better protect the public. 

To many, these white collar crime examples can seem unrelatable in their sheer scale and audacity—but within each newsreel-worthy story of vast-scale fraud, bribery, or insider trading lies a valuable lesson for even the most modest of business owners. In truth, no enterprise is immune to the threat of white collar crime. This makes learning valuable lessons and being proactive about prevention key to avoiding becoming another number in the worst kinds of statistics.

What Can We Learn from These White Collar Crime Examples?

You may be familiar with these white collar crime examples, but why not stop and look again? Within each dramatic tale lies a valuable lesson for any business or organization that is keen to safeguard against the perils of white collar crime and the painful losses, workplace investigations, and potential litigation that so often follow.

Bernie Madoff’s Story Shows Us the Vital Role of Reporting Channels

Perhaps the most famous white collar crime in all of history, Bernie Madoff’s dastardly actions introduced the term “Ponzi scheme” into the everyday American lexicon. Once a jack of all trades, Madoff managed to climb his way up to become the chairman of the NASDAQ before forging a multi-billion dollar investment firm on the back of entirely falsified trading reports. 

Despite years of swirling rumor, the villain remain unscathed until one of his own sons reported him to the authorities. For Madoff, the result of that fateful flow of information was a 150-year jail sentence passed in 2009. The question is, how healthy are your enterprise’s reporting channels?

The Wirecard Scandal Demonstrates the Importance of Oversight 

In another dark star among white collar crime examples, all appeared to be going fantastically for the 20-year-old German electronic payments company Wirecard. However, an unexpected audit revealed a $2 billion hole in their books. 

Ultimately, CEO Markus Braun took the fall in 2020 for falsifying financial records, while his co-conspirator COO Jan Marsalek fled charges and is thought to be hiding out in Russia. The question is, how stringent are your organization’s financial oversight mechanisms?

The HealthSouth Accounting Case Shows Why Ethics Are Key in Corporate Culture

Despite the facade of a focus on wholesome well-being, HealthSouth had been attracting suspicion for its financial dealings since the 1980s. Unfortunately, behind closed doors founder Richard Scrushy had falsified billions of dollars worth of profits, engaged in bribery and mail fraud, and tragically defrauded Medicare and other federal healthcare programs. It makes us wonder, how strong is the ethical framework within your company’s corporate culture plan?

Marcus Schrenker’s Story Showcases the Power of Corporate Investigations

As alarming as all cases of white collar crime might be, there is comfort in knowing that effective corporate investigations can leave fraudsters quaking in their boots. In 2008, Indiana native Marcus Shrenker’s unethical practices as a money-grabbing investment advisor ultimately caught up with him. 

An investigation ensued, and rather than face the consequences of his actions, Schrenker attempted to fake his own death by staging a plane crash and parachuting to safety. Happily, investigators saw right through the theatrics and put Schrenker behind bars. The moral of the story is that even the most cunning of criminals are no match for high-caliber corporate investigators!

Do You Require Assistance Keeping White Collar Crime at Bay?

Here at Lauth Investigations International, we take immense pride in helping corporations across the country safeguard the interests of their shareholders and employees while supporting their success and prosperity. This includes the provision of deft, swift, and effective white collar crime investigations. However, it also includes preventative strategies, such as corporate culture audits, candidate background checks, and more. Do you require assistance keeping white collar crime at bay? If so, get in touch today for a no-obligation consultation about how we can support you best.

What Is White Collar Crime And How Much Is It Costing YOUR Business?

What Is White Collar Crime And How Much Is It Costing YOUR Business?

Did you know that a single shady threat is behind a potential $1.7 trillion in annual losses for American businesses each year? Alarmingly, the number can only be estimated because as many as 90% of instances of this particular flavor of crime go unreported. And who or what is this sly and shadowy danger? It’s none other than white collar crime. So, would you know how to protect yourself against it, and do you have effective measures in place?

Understanding the Enemy: What Is White Collar Crime?

The term “white collar crime” was coined back in 1949 by a sociologist named Edwin Sutherland. He defined it as a crime committed by a person of respectability and high social status in an era that typically saw white-collar workers hold office positions and blue-collar workers hold industry roles. Crucially, white collar crime is usually non-violent in nature, instead targeting financial gain, while being perpetrated by individuals, businesses, organizations, and government officials alike. Examples include but are not limited to:

  • Ponzi schemes
  • Embezzlement
  • Accounting fraud
  • Bribery
  • Email fraud
  • Identity theft
  • Money laundering
  • Data theft
  • Insider trading
  • Securities fraud

All too sadly, the Lauth team’s extensive experience in corporate workplace investigations tells us that we are living in an era of rampant white collar criminality escalation. The usual suspects of Ponzi schemes, accounting and securities fraud, money laundering, and insider trading are joined by an ever-expanding realm of internet scams, ranging from cryptocurrency scandals to fraudulent email networks. 

While some of these schemes target individuals, many set the assets of businesses and enterprises in their crosshairs. Without stringent preventative measures, many companies don’t realize the scale of the risk until it’s too late—and are left trying to stay afloat while desperately trying to claw back a portion of their losses and field potential liability if customer or investor assets have been lost.

The Bottom Line on White Collar Crime Today

Because of the scale of the threat, white collar crime is taken very seriously at a federal level, with the FBI, SEC, and NASD working with state authorities to bring perpetrators to justice. Penalties for committing a white collar crime include prison, fines, and paying restitution—although many cornered white collar criminals submit to negotiated repayment programs, avoiding the involvement of law enforcement agencies altogether. As we touched upon earlier, data reveals that this is clearly a path that many organizations prefer.

However, out-maneuvering the perpetrator of white collar crime requires deft workplace investigations, and most organizations call in expert investigatory assistance in this area. Skilled and licensed corporate investigators can carry out forensic accounting, gather evidence, conduct suspect surveillance—even going undercover when necessary to paint a clear picture of the crime and provide proof that will stick. In this vein, a high caliber of documented evidence is your best protection against loss of assets and potential liability for the company itself.

Better yet, prevention is an excellent place for the savvy business owner to begin. Criminal behavior is bred in toxic working environments and when un-vetted employees are allowed to join your workforce. So, alongside rapid, discreet, and diligent investigations of white collar crime, the team here at Lauth Investigations International also assists with preventative corporate culture audits and comprehensive background checks—drawing on many of the same databases used by law enforcement agencies to keep your company’s assets safe.
Do you need support in navigating the choppy waters of white collar crime? From effective prevention to covert workplace investigations, the seasoned corporate team here at Lauth Investigations International can provide just the skillset required to help you reach dry land unscathed. Reach out today to discuss your needs and receive no-obligation guidance on our diversity of investigative and preventative services.

This Is The Major Key To Preventing White Collar Crime

This Is The Major Key To Preventing White Collar Crime

white collar crime

Have you ever noticed how defending against certain kinds of corporate threats can seem obvious but others less so? For example, data theft can be prevented with top-notch digital security and physical inventory theft with security teams and CCTV systems. These dangers are easy to imagine and anticipate, but others are ominously shadowy. White collar crime is a shadier case because the enemy often lies within—a trusted member of your team who decides to line their own pockets illegally. 

Sure, white collar crimes might be non-violent, but they can dent or sink companies just as readily as bombs do ships. So what is the most important factor when aiming to block a white collar crime stealth attack? The answer might surprise you.

There are numerous practices and procedures that can act as layered lines of defense against white collar crime: human resources oversight, coordinated access control, dual-authorization for asset transfers, background checks for recruits, and more. However, a single factor can be more relevant than any of these, and that is corporate culture.

To understand why, ask yourself a few simple questions. What leads a person to want to rip off their employers, customers, or shareholders? What allows a team to decide not to report the nefarious activity of a colleague? When corporate culture sours, employees on any level can experience resentment, entitlement, or simply little enough emotional investment that they’re willing to turn a blind eye. So let’s explore how to avert these scenarios effectively through the strengthening of corporate culture.

Why You Should Care About the Culture Within Your Business

White collar crime can sound dramatic and unimaginable when we see it in the news, but in reality, more than 35% of U.S. businesses have felt the very real sting in its tail. For businesses that have allowed a toxic workplace culture to stew, the bad news is that white collar crime is just one of the potential symptoms of a corporate curdle. Others include employee theft, malingering, rapid turnover, FMLA fraud, bullying, harassment, discrimination, workplace violence, and more. 

In a melting pot of bad corporate culture, you can be sure that by the time you start to spot red flags popping up everywhere, productivity will have plummeted and untold damage may have been done. However, it’s never too late to turn the ship around.

In contrast, a strong corporate culture is home to effective communication, high-caliber talent, shared goals and values, strong company loyalty, engaged and mutually supportive teams, and—critically—a universal sense of responsibility that makes the working environment hostile to those with criminal intentions. 

Undoubtedly, it is very difficult to run a scam or scheme in an environment where everyone has their eye on the ball. Critically, employees who feel nurtured and supported within the workplace are far less likely to consider biting the hand that feeds them. With that in mind, let’s explore how to rapidly course-correct your corporate culture and keep it on track.

Combat White Collar Crime With a Corporate Culture Audit

Understanding not only how vital corporate culture is to the successful operation of any business but also how urgent addressing eroded workplace culture can be, we developed a comprehensive service to support proactive clients within the corporate sphere. The Lauth Investigations Corporate Culture Audit serves as a critical health check for businesses and a primary line of defense against white collar crime.

Some of our clients use this resource as a preventative measure, periodically reviewing their current corporate culture standing and setting a course for continuing improvement. Others use it as a fire extinguisher—a means to press pause on a situation that has gotten out of hand and take strategic steps toward a far more solid position.
Our corporate investigations team provided tailored auditing, addressing everything from assessing operational efficiency, shared values, and communication practices to uncovering unseen wrongdoing and potential white collar criminality in the workplace. If we illuminate something that you weren’t expecting, we can also assist with swift, discreet, and effective corporate investigations to deliver justice and better protect your interests. To have a team of corporate culture and white collar crime experts in your corner, reach out to Lauth Investigations International today—because prevention is even more powerful than cure.

Keeping Leadership Honest by Preventing White Collar Crime

Keeping Leadership Honest by Preventing White Collar Crime

For many business owners, white collar theft seems like a pretty abstract concept until  faced with its fallout first hand. We tend to romanticize the idea of the white collar criminal, and how could we not? Over the years, cinema has glorified this kind of perpetrator—from Leonardo DiCaprio in the Wolf of Wall Street to Christian Bale in American Hustle. But as fascinating as the idea of a well-paid professional taking an insane risk for illicit gain may be, at the end of the day there are always victims left behind.

The FBI reports that white collar theft costs the United States upward of $300 billion per year. And while its true that 31% of this kind of illegal activity is undertaken by operations staff, the vast majority was ultimately traced to trusted leadership. Yes, some 34% of white collar theft was found to be committed by middle management and 26% by senior management. That means that if someone’s going to engage in this kind of behavior within your business, the chances are they’ll be doing so from somewhere within your core leadership team.

Delving Into the Mind of White-Collar Criminals 

A substantial part of mitigating white collar theft among your leadership lies in anticipating where the criminally inclined might find means and opportunity. This begins with conducting comprehensive background checks on managerial or high-responsibility candidates—or potentially leaders already in place if this step was overlooked during recruitment. 

Introducing security-centric procedures such as segregating and rotating certain duties can remove opportunity to some extent, as can using accounts-monitoring software and making timely audits. Launching an anonymous white collar theft tip line is also a powerful tool that shouldn’t be overlooked. In fact, the #1 way that occupational fraud is detected is via a tip, and companies with a hotline manage to detect white collar crime 33% faster than their counterparts.

Of course, the ill-intended are most likely to thrive in a working environment where many of their colleagues are already bending or breaking the rules. Team members suffering low morale due to work-related stress are also far less likely to feel motivated to report white collar theft if they witness it. These factors alone should be enough to inspire you to prioritize elevating your corporate culture if you aren’t already. 

It’s true that organizations with strong culture enjoy better employee performance and greater profits, and the flip-side of that is that those with an eroded culture can become a hotbed of white collar crime—right under the nose of oblivious executives. Fundamentally, your leadership staff are critical to setting the tone on corporate culture, so if you suspect that their example is anything but shining, a corporate culture audit is definitely in order.

Navigating White Collar Theft When It’s Rooted With Leadership

When employee misconduct is coming from lower-level team members, the process to deal with it—from investigation through to discipline or dismissal if required—can be uncomfortable, but is ultimately a part of being responsible for a functioning team. However, when the suspect of workplace criminality is a member of your most trusted inner-circle, and perhaps someone who has been by your side for years, the situation becomes a little more challenging.

While HR may usually take the lead on employee investigations, this can become problematic if the individual in question is senior to the HR team. Simultaneously, impartiality is critical to navigating a potentially criminal corporate investigation, and long-standing colleagues can hardly be expected to assess the facts without bias, making it tricky for fellow leaders to investigate a peer. The only logical option in dynamics such as these is to bring in an external corporate investigator to provide pivotal support.

The investigator’s work may begin with a corporate culture audit or a targeted investigation following an unexplained discrepancy. In instances where discretion is key, an undercover investigator can be placed within your team to covertly gather facts until a case is solid enough to bring it forward. Providing peace of mind to those seeking this support, the seasoned and specialized corporate investigator will be able to advise on how to navigate each unique situation in pursuit of the best possible outcome.

So, whether you wish to initiate a culture audit or risk assessment as a preventative measure against white collar theft, or want to know what truth lies concealed from your suspicions, the expert corporate team at Lauth Investigations International is ready to assist. Learn more about our approach to white collar crime or reach out to us today for a no-obligation consultation and we’ll help you explore your options.

How to Detect Embezzlement Within Your Company

How to Detect Embezzlement Within Your Company

Understandably, embezzlement is something of a specter—a ghost haunting the dreams of business owners across America. Why? Because embezzlers often go undetected for years, are usually in a long-standing position of trust, can leave a gaping financial hole that is discovered all too late. 

Alarmingly, the average company loss through embezzlement is a whopping $357,650, and over half of businesses recover less than one-third of what was lost. If you know that a crisis on that scale could cripple your enterprise, a timely embezzlement investigation is a proactive way to place yourself on the happier side of those numbers. In fact, many don’t realize that an embezzlement investigation can be both reactive or cautionary, depending on their sense of vulnerability. So, is it time to call in a corporate investigator to make sure you haven’t got a capital drain in free-flow right under your nose?

Knowing the Common Types of Embezzlement

When we talk about launching an embezzlement investigation, what kind of crimes might we be looking at? Well, embezzlement is an umbrella term for any type of fraud or capital theft engaged in by an employee and afforded by their position of trust. 

Common forms of embezzlement include chronic undercharging of friends and family in a customer-facing setting, or creating a phony ghost supplier to charge your company for transactions that never really existed. The embezzler may fabricate fake refunds or fictitious bad debt. Another common type is payroll fraud—although there are many ways in which an embezzler may cook the books so that their thefts go undetected.

Red Flags of an Embezzler In Your Midst

If the perpetrator covers their tracks well, even your CFO may not notice that a sinkhole is growing in the company’s financials. However, there are other factors to become attuned to that may indirectly let you know an embezzlement investigation is called for.

For example, someone neck-deep in a complex embezzlement scheme may be very reluctant to take their accrued vacation days while exhibiting enthusiasm to work overtime. As you can imagine, moments when honest employees and management are off the clock create a far easier setting for them to conduct their nefarious activities undisturbed. 

An employee overseeing an unmeasured expense such as office supplies or with access to petty cash that they can skim from should always be subject to scrutiny. So too should employees who start spending in a way that doesn’t reflect their salary, or those who dedicate a lot of time to whispered meetings with co-workers or vendors. Keep in mind that 79% of embezzlement cases involve more than one person collaborating to rip off their employer.

Launching an Embezzlement Investigation and Preventing Future Problems

As grim as these statistics might be, employers can reclaim their confidence by uncovering and stopping embezzlement in its tracks and taking steps to prevent it from happening again. Because of the complex nature of embezzlement crimes, a specialist corporate investigator is the ideal ally for tackling this challenge. They will be able to roll out digital forensics, surveillance, background checks, and even undercover investigations to bring the perpetrators and their methods to light.
A corporate investigator from Lauth Investigations International can also help you safeguard your future endeavors with comprehensive employee screening, risk assessments, procedural overhauls, and corporate culture assessments. A rise in employee misconduct often indicates a larger problem and a culture audit is a swift way to address the cause rather than only the symptoms. Would you like to know more about how we can help your business navigate an embezzlement investigation? Then connect with us today for a no-obligation consultation.

Investigating White Collar Crime Covertly

Investigating White Collar Crime Covertly

For any company with precious assets and interests to safeguard, fortifying the ramparts against external threats is a given—but what happens when the true dangers lurk within? White collar crime occurring under the radar often leaves a trail of devastation in its wake. Making matters worse, the greater the position of trust enjoyed by the perpetrators, the more substantial the damage is likely to be.

In truth, the extent of white collar crime across the US remains an unknown—loosely estimated to be anywhere between $426 billion and $1.7 trillion annually—because data suggests that as many as 90% of white-collar crimes go unreported. Simultaneously, prosecutions continue to drop, having plummeted by more than 50% since 2011. So, how can you ensure that your organization doesn’t simply become one of these sinister statistics?

Covert corporate investigations can help you identify the white collar criminal and stop them in their tracks. From stemming the flow of financial haemorrhaging to gathering enough evidence to take swift legal action, a corporate investigator from Lauth Investigations International will serve as your secret weapon against white collar crime.

What Constitutes White Collar Crime?

If you think that your leadership team doesn’t warrant scrutiny, think again. The types of white collar crime that our investigators regularly encounter are diverse in nature. Bad actors with data and assets at their fingertips can soon dip into nefarious activities such as securities fraud, insurance fraud, insider trading, money laundering, embezzlement, bribery, tax evasion, Ponzi schemes, identify theft, and more. 

What’s worse is that a company operating under a veil of naivety will not only be vulnerable to substantial financial losses, but also potential implication in illegal activity that may lead to a quagmire of investigations and litigation. The key to avoiding such an unwelcome destiny is constant evaluation of security protocols and taking deft action whenever the faintest aroma rises that something might be amiss.

Why You Might Call on Covert Corporate Investigations Services

Preventive measures to keep white collar crime at bay include conducting regular Corporate Culture Audits, threat assessments, and comprehensive employee background checks. These tactics can dramatically reduce the risk that a member—or members—of your team are about to go rogue. However, when warning signs begin to appear, covert corporate investigations become the best resource in your toolkit for nipping white collar criminality in the bud.

Examples of these raise-the-alarm indicators include finding evidence of losses but being unable to trace their cause, receiving a tip on criminal activity but lacking the detail to address it, becoming aware of worrying evolution of departmental team dynamics, or pervasive divergence from company policy within the behaviours of employees. At times, the signs that all is not well are obvious, but at others, following an instinctive hunch that something is amiss can mean the difference between taking swift disciplinary action and moving smoothly on, or being overwhelmed under the weight of an escalating legal fallout. 

Covert Corporate Investigations From Lauth Investigations International

Our seasoned and objective undercover operators are experts at quickly blending in within any corporate environment, adopting the role of a new recruit before tracking and evidencing all of the information required to identify a white collar crime perpetrator and mount an effective counter offensive. Their speciality is illuminating the unseen within your organization, drawing not only on covert corporate penetration tactics but also cutting-edge surveillance technology and licenced access to verified law enforcement-favored databases.

Covert corporate investigations are not only ideal for revealing the facts of a white collar crime as quickly as possible, but also ensuring that navigating this internal threat is done discreetly, protecting your organization’s operations from the substantial disruption that can occur when an unmitigated crisis takes hold. If you are concerned about white collar crime within your teams, we are ready to assist. Connect with our corporate investigations specialists today and protect your assets and integrity from internal dangers.