http://www.tampabaycfe.org

September 2005

white-collar crime: an overview

The phrase "white-collar crime" was coined in 1939 during a speech given by Edwin Sutherland to the American Sociological Society. Sutherland defined the term as "crime committed by a person of respectability and high social status in the course of his occupation." Although there has been some debate as to what qualifies as a white-collar crime, the term today generally encompasses a variety of nonviolent crimes usually committed in commercial situations for financial gain. Many white-collar crimes are especially difficult to prosecute because the perpetrators are sophisticated criminals who have attempted to conceal their activities through a series of complex transactions. The most common white-collar offenses include: antitrust violations, computer/internet fraud, credit card fraud, phone/telemarketing fraud, bankruptcy fraud, healthcare fraud, environmental law violations, insurance fraud, mail fraud, government fraud, tax evasion, financial fraud, securities fraud, insider trading, bribery, kickbacks, counterfeiting, public corruption, money laundering, embezzlement, economic espionage, and trade secret theft. According to the Federal Bureau of Investigation, white-collar crime is estimated to cost the United States more than $300 billion annually.

Although white-collar criminal charges are usually brought against individuals, corporations may also be subject to sanctions for these types of offenses. The penalties for white-collar offenses include fines, home detention, community confinement, costs of prosecution, forfeitures, restitution, supervised release, and imprisonment. However, sanctions can be lessened if the defendant takes responsibility for the crime and assists the authorities in their investigation. Any defenses available to non-white-collar defendants in criminal court are also available to those accused of white-collar crimes. A common refrain of individuals or organizations facing white-collar criminal charges is the defense of entrapment. For instance, in United States v. Williams, 705 F.2d 603 (2nd Cir. 1983), one of the cases arising from "Operation Abscam," Senator Harrison Williams attempted unsuccessfully to argue that the government induced him into accepting a bribe.

Both state and federal legislation enumerate the activities that constitute white-collar criminal offenses. The Commerce Clause of the U.S. Constitution gives the federal government the authority to regulate white-collar crime, and a number of federal agencies (see sidebar), including the FBI, the Internal Revenue Service, the Secret Service, U.S. Customs, the Environmental Protection Agency, and the Securities and Exchange Commission, participate in the enforcement of federal white-collar crime legislation. In addition, most states employ their own agencies to enforce white-collar crime laws at the state level.

Source: http://straylight.law.cornell.edu/topics/white_collar.html

Embezzlement - A Definition

embezzlement, wrongful use, for one's own selfish ends, of the property of another when that property has been legally entrusted to one. Such an act was not larceny at common law because larceny was committed only when property was acquired by a “felonious taking,” i.e., when the act was committed with respect to property that was at the time in the legal possession of the owner.

Consequently, unfaithful servants, employees, agents, trustees, or guardians who misappropriated another's property could be sued only in the civil courts, on the grounds that although the defendant had legally come into possession of the property, he had breached his trust by wrongfully misappropriating it to his own use. To remedy this situation statutes were passed in England and the United States that either made embezzlement a distinct crime or enlarged the definition of larceny in such a way as to include all cases of misappropriation of property in the lawful possession of the wrongdoer. In most states of the United States embezzlement is a felony. Under acts of Congress, stealing of letters by postmasters, clerks, and letter carriers is considered embezzlement.

Source: http://www.answers.com

What is the difference between larceny and embezzlement?

The major difference between larceny and embezzlement is the way in which the property changes hands. With larceny, the property is carried away; it was never in the possession of the perpetrator. With embezzlement, however, the perpetrator has lawfully possessed the property, but then has converted it into his/her own property.

The following example illustrates the difference. A man walks onto a construction site and takes a hammer and goes home. He has committed larceny, because he has taken someone else’s property away, with the intent never to return it. A construction worker on that same site, who uses the hammer every day, puts it in his pocket at the end of the day and takes it home. He has committed embezzlement, because it was in his possession to use while he worked on the site, but when he took it off the site, he converted it into his own property.

Source: http://criminal-law.freeadvice.com/white_collar_crimes/embezzlement_larceny.htm

TRAINING

Association of Certified Fraud Examiners

Advanced Computer Aided Fraud Prevention & Detection

CPE Credits: 16
12/12/2005 - 12/13/2005

Clarion Hotel Tampa Westshore
5303 W. Kennedy Blvd.
Tampa, FL  33609
+1 (813) 289-1950
+1 (813) 287-2002 (Fax)
Room Rate: $79.00 - subject to availability
Hotel Cut-off Date: 11/11/2005
Early Registration Deadline: * 11/14/2005

Tampa Bay Chapter

Dinner Meetings

September 13, 2005
"White Collar Crime - Embezzlement"

October 18, 2005
"Identity Theft - Resolution & Restoration"

January 10, 2006
"T.B.A."

February 14, 2006
"T.B.A."

March 14, 2006
"T.B.A."

April 11, 2006
"T.B.A."

7th Annual Fraud & Computer Crimes Seminar

May 9 - 10, 2006
Ruth Eckerd Hall
1111 McMullen Booth Road
Clearwater, FL 33759

2005 - 2006
OFFICERS & DIRECTORS

PRESIDENT
Steve Hooper, CIA, CFE, CCSA
Clerk of the Circuit Court Hillsborough County, FL
(813) 276-2029 x3703

VICE PRESIDENT
Christine Dever, CPA, CFE
 

SECRETARY
Kara Preston, CFE
Polk County Sheriff's Office
(863) 499-2400

TREASURER
Laura Krueger Brock, CFE, CPA
Cherry, Bekaert, Holland, LLP
(727) 822-8811

DIRECTOR
Mark Dubina, CFE
Florida Department of Law Enforcement
(813) 878-7366

DIRECTOR
Ellen Wilcox, CFE
Florida Department of Law Enforcement
(727) 298-2482

DIRECTOR
Penny Borjas, CFE, CIA

CHAPTER TRAINING
Wayne Boytim, CFE
City of Tampa, Internal Audit
(813) 274-7167

Dinner Meeting News

September 13th Dinner Meeting

Allen Ezell, CFE, is employed as Vice President, Corporate Fraud Investigative Service, Wachovia Corporation, Tampa, Florida. Mr. Ezell will speak on White Collar Crime - Embezzlement. Mr. Ezell handles both internal and external fraud at Wachovia Corporation and its subsidiaries. He was employed by the Federal Bureau of Investigation for 31 years until his retirement in December,1991.   He also worked at the Boston, Charlotte, and Tampa FBI offices. As a Special Agent (Accountant) he investigated various violations of White Collar Crime, including Diploma Mills.

During these investigations over an eleven year period (1980-1991), Special Agent Ezell obtained 10 Bachelor, 19 Masters, 4 Ph.D. degrees, still finding time to obtain 2 M.D. degrees. (He assisted in other FBI Agents also obtaining degrees from Diploma Mills). After becoming a “graduate”, Ezell visited his alma matter, normally was taken on a tour at which time he made observations which were later used in affidavits for federal search warrants.  (On occasion, he was recruited to work for the school or raise money on their behalf).

The dinner meeting will be held at the Clarion Hotel Tampa Westshore, located at 5303 West Kennedy Blvd. NOTE: THIS MEETING WILL BE HELD ON THE 2ND FLOOR. The hotel is just west of Westshore Plaza on the north side of Kennedy Blvd. Evenings will begin with a social at 6:00 P.M., followed by a buffet dinner at 6:30 and a presentation at 7:00. The cost remains only $15.

To make your reservation, please use the following link Chapter Meeting Reservation and complete the form at the bottom of the page.  You can also make your reservation by emailing Wayne Boytim or calling him at (813) 274-7167 by the Friday before the meeting date. Reservations will be accepted after that date and walk-ups are always welcome. Please remember that cancellations are accepted up to the afternoon of the meeting. No shows will be billed after the second missed meeting. Please help us keep our costs down by letting us know if you are unable to attend.
 

Local Chapter Member Quoted in the Tribune

For those of you who missed it, FDLE Special Agent William Miles, CFE, and Tampa Bay Chapter member was quoted in "Foreign Scams Showing Up In Local Mail" published in the Tampa Tribune on August 31, 2005. The article had to do with new variations of lottery and other scams originating in Europe, Canada and Nigeria, which target U.S. victims.

Because of his involvement working such cases, Bill explained how the scams worked and together with U.S. Secret Service Special Agent John Joyce, that their effectiveness is due to the quality of the counterfeit documents and greed. The Tampa Tribune article can be found at: http://tampatrib.com/floridametronews/MGBZV6121DE.html.

WARNING...New Credit Card Scam

Note, the callers do not ask for your card number; they already have it. By understanding how the VISA & MasterCard Telephone Credit Card Scam works, you'll be better prepared to protect yourself.

The scam works like this: Person calling says, "This is (name), and I'm calling from the Security and Fraud Department at VISA. My Badge number is 12460. Your card has been flagged for an unusual purchase pattern and I'm calling to verify. This would be on your VISA card which was issued by (name of bank). Did you purchase an Anti-Telemarketing Device for $497.99 from a Marketing company based in Arizona?" When you say "No", the caller continues with, "Then we will be issuing a credit to your account. This is a company we have been watching and the charges range from $297 to $497, just under the $500 purchase pattern that flags most cards. Before your next statement, the credit will be sent to (gives you your address). Is that correct?"

You say "yes." The caller continues - "I will be starting a Fraud investigation. If you have any questions, you should call the 1- 800 number listed on the back of your card (1-800-VISA) and ask for Security."

"You will need to refer to this Control Number." The caller then gives you a 6 digit number. "Do you need me to read it again?" Here's the IMPORTANT part on how the scam works. The caller then says, "I need to verify you are in possession of your card." He'll ask you to "turn your card over and look for some numbers." There are 7 numbers; the first 4 are part of your card number, the next 3 are the security numbers that verify you are the possessor of the card. These are the numbers you sometimes use to make Internet purchases to prove you have the card.

The caller will ask you to read the 3 numbers to him. After you tell the caller the 3 numbers, he'll say, "That is correct, I just needed to verify that the card has not been lost or stolen and that you still have your card. Do you have any other questions?" After you say No, the caller then thanks you and states, "Don't hesitate to call back if you do" and hangs up.

You actually say very little and they never ask for or tell you the Card number. Long story made short - what the scammers want is the 3-digit PIN number on the back of the card. Don't give it to them.

Instead, tell them you'll call VISA or Master card directly for verification of their conversation. The real VISA will never ask for anything on the card as they already know the information since they issued the card! If you give the scammers your 3 Digit PIN Number, you think you're receiving a credit. However, by the time you get your statement you'll see charges for purchases you didn't make, and by then it's almost to late and/or more difficult to actually file a fraud report.

White Collar Crime Embezzlement and Penalties

White collar embezzlement and penalties depend on the specific circumstances of the case. For instance, charges of embezzlement can be negotiated if it is proven that the embezzler intended to return what s/he had procured. White collar embezzlement and penalties differ from larceny charges because in embezzlement cases the perpetrator legally assumes possession of the property, but then assumes illegal rights to it. A white collar embezzler often has a fiduciary relationship with the victim, meaning that the perpetrator has been entrusted by the victim with specific responsibilities.

One of the most common forms of embezzlement is employee theft, where employees who have access to their business's property procure it for their own use. White collar embezzlement is detected based on a number of factors including missing, late or suspicious documents, unexplainable profit fluctuations, and employee behavior such as personal spending behaviors, eagerness to work overtime, and other suspicious acts.

In order for white collar embezzlement and penalties to be proven and enforced, four things must be established in a case. A fiduciary relationship between the defendant and the victim must be proven. That relationship must be shown to have resulted in the defendant's possession of the property in question. The fact that the defendant illegally assumed rights to said property must be confirmed. And it must be revealed that this appropriation was intentional.

White collar embezzlement and penalties can be sought by a victim through the civil or criminal court systems. An employer, who suspects or has knowledge that his /her employee(s) are embezzling company property, may wish to speak with an embezzlement legal expert. This experienced attorney can advise an employer of his/her legal rights and options in a possible white collar embezzlement and penalties case.

White collar embezzlement and penalties include being charged with a felony in either a criminal or civil federal or state court system. The specific court system through which white collar embezzlement and penalties are decided depends on the circumstances of the crime. White collar embezzlement and penalties can include both monetary fines and jail time. Penalties usually depend on the value of the property that was embezzled. The severity of white collar embezzlement determines the severity of the penalties. If you have more questions about white collar embezzlement and penalties you may wish to speak to a qualified attorney.

Source: http://www.onlinelawyersource.com/criminal_law/white_collar/embezzlement.html

From the Association of Certified Fraud Examiners

Advanced Computer Aided Fraud Prevention & Detection

CPE Credits: 16
12/12/2005 - 12/13/2005

Clarion Hotel Tampa Westshore
5303 W. Kennedy Blvd.
Tampa, FL  33609
+1 (813) 289-1950
+1 (813) 287-2002 (Fax)
Room Rate: $79.00 - subject to availability
Hotel Cut-off Date: 11/11/2005
Early Registration Deadline: * 11/14/2005

This 2-day instructor-led course will explore computer-aided search strategies that are effective when trying to prevent and detect fraud. You will learn how to test allegations and support ongoing cases, expand a fraud examination and conduct “proactive” fraud tests. Advanced Computer-Aided Fraud Prevention and Detection will also teach you about fraud detection methodology – how to match indicators to schemes using a variety of database queries. Technical issues will also be addressed such as computer-aided data analysis programs and specific computer-aided fraud tests. Expand your skills with this advanced course!

Member: $695.00 *  Early Registration Price: $600.00 *
Non-Member: $795.00 *  Early Registration Price: $700.00 *

To view course outline and to register: http://www.cfenet.com/events/EventDetail.asp?PackageID=1462&EventID=524

ISACA West Florida Chapter - Network Auditing The Basics

Register Now! Class is filling fast!!
Training Day - September 12, 2005
Network Auditing - The Basics

Cost:
Member - ISACA: $100
Member - Other*: $100
Non-Member: $125
Student (full-time): $25
* Member rate is being extended to other Professional Organizations, including the Tampa Bay Chapter of the ACFE
Includes: Parking, Continental Breakfast, Lunch, Snack

Location:
Wyndham Harbour Island
725 S Harbour Island Blvd
Tampa, 33602
(813) 229-5000

Parking will be paid for by the ISACA Chapter

Time:
Registration: 8:00 a.m.
Start Time: 8:20 a.m.
End Time: 4:00 p.m.

Click Here to Register <http://www.westfloridaisaca.org/Register.asp>

Or go to ISACA's website www.westfloridaisaca.org for more information.
 

ACFE Membership Poll

 The ACFE released the results of a poll of members that was conducted recently.  It was interesting to discover that the poll results tie closely to the points highlighted (see the President’s Message) at the seminar “Growing Your Organization” at the Chapter Representatives meeting in July.  More than 50% of our Chapter members hold the CFE certification and 13 associate members took advantage of the reduced rate CFE Prep Course offer as the first step in earning the credential.   

Members join the ACFE to:

Referrals are the best source of membership:

Members say these benefits are valuable:

A Message from our President

I want to take a moment and extend my appreciation to our outgoing President, Penny Borjas, the officers and directors, for the outstanding job they did the past year. Under their watch, the chapter grew to a record 175 members and is viewed by the Association as one of their elite chapters. Attendance increased to record highs at our dinner meetings. Networking continued between our local college students and chapter members in an educational effort to prompt interest in the fraud profession. In May, the Chapter ventured away from the norm and held the 6^th Annual Fraud and Computer Crime Seminar at the Radisson Hotel and Conference Center in St. Petersburg. The evaluations we received from the attendees regarded it as one of the best seminars that they have attended. With that, a special thank you goes to Gary Chapman who worked feverishly in the days leading up to the seminar as our liaison with the hotel. As you can see, plenty was accomplished during the past year and now it is left up to this year’s officers and directors to keep steering the Chapter down the road of success.

During our first administrative meetings, the board discussed a number of things we would like to see happen during the coming year. Our list of “we wanna’s” goes like this: We want our members to spark excitement about our chapter to co-workers. We want to promote the chapter to the local community by sponsoring a youth activity. We want our dinner meetings to be more than a networking opportunity. We want to hear and discuss, the lessons learned by CFEs. We want to competitively compete for the Association’s “Chapter of the Year” award. We want to see more competition in our student and CFE scholarship program. We want the 7^th Annual Fraud and Computer Crimes Seminar to be the best ever. Finally, we want to take a proactive approach to encouraging membership in our chapter so we may maintain the steady increase we have grown accustom to seeing in recent years.

To do these things, we have to be excited about our chapter. At the last chapter representatives meeting held in Washington D.C., participants were asked to list the top twelve reasons someone should join their local chapter. Wayne Boytim, this year’s representative, brought to us the list of reasons we should give if asked. Here’s the list with my spin on what I think each one means:

• Career investment -  knowledge, education, best practices, staying current.

• Gain recognition - An organization devoted to our profession and our community.

• Advance your career - Greater knowledge and implementing the best practices learned.

• Contacts for employment - Over 175 members in addition to our dinner and seminar speakers.

• Continuing professional education - Earn up to 20 fraud related CPE hours per year.

• Affordable local training - Dinner meetings subsidized by the chapter and remain at only $15.

• High quality training - Our two-day seminar continues to receive outstanding ratings.

• Advances in technology - New trends are discussed and shared.

• Certification - Incentives offered by the Association and a CFE scholarship from the chapter.

• Access to continuing education - Partnering with other local professional organizations.

• Stay current in the fraud field - Members have access to all new developing trends.

• Networking - At 175 members, we offer a wide range of knowledge and skills.

So be prepared to sell  the benefits of being a chapter member.

Now for the Chapter of the Year award. We are already doing a lot of the good things it takes to qualify but we need to hear from our members as to their community relations efforts, especially in promoting fraud deterrence. Please let us know if you are participating in speaker groups, community advisory meetings, or promoting fraud deterrence in a different way.

Your Vice President, Christine Dever is hard at work putting the dinner meetings and annual seminar together. The dinner meetings will be held at the Clarion again this year. At present, it looks like our fraud seminar will be held at Ruth Eckerd Hall in Clearwater. So please, if you attended, come again. If you didn’t, don’t miss this excellent opportunity to get valuable continued professional education credit from the group of speakers and topics that Christine is putting together for this event. You will not be disappointed.

As you can see, we have a pretty full plate to get accomplished this year. I am excited about the upcoming year and I hope that the efforts of our members and the Board will bring the official recognition to our chapter it so richly deserves.

Steve Hooper