© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. 1 David P. Twomey - Boston College Marianne M. Jennings - Arizona State University

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 2 Chapter 8 Crimes Crimes

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 3 A.General Principles 1.Nature And Classification Of Crimes 2.Basis Of Criminal Liability 3.Responsibility For Criminal Acts 4.Indemnification Of Crime Victims

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 4 A. General Principles 1.Nature and Classification of Crimes. [LO.1] –Crime is conduct that is prohibited and punished by a government. –Can be violation of common law or statutory law. –A misdemeanor is punishable by a fine or less than a year in prison. A felony is a crime that is punishable by imprisonment or death.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 5 A. General Principles (A) (A) Mental State The defendant does not have to know that the act is criminal; it is sufficient that the act was done voluntarily. (B) Act or Omission An act or omission of a required act must actually take place. B. Basis of Criminal Liability. [LO.2] Harm Harm may occur, but it is not a required element for an act to be classified as a crime.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 6 A. General Principles 3.Responsibility for Criminal Acts. [LO.3] (A) Corporate Liability. (B) Officers and Agents of Corporations may be held responsible for the criminal acts of their employees. Liability may attach when employees fail to act.  U.S. v. Erickson: convictions were upheld; defendants intentionally backdated documents.  U.S. v. Park: corporate officers can be held personally liable for corporate crimes.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 7 A. General Principles 3.Responsibility for Criminal Acts. [LO.4] (C)Penalty for Crime: Forfeiture. is a penalty for a crime. (D)Penalties for Business and White-Collar Crimes. ―Courts now apply percentage of revenues when calculating corporate fines and penalties. ―Mandatory prison sentences for officers. US Sentencing Commission.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 8 A. General Principles 3.Responsibility for Criminal Acts. (E)Sarbanes-Oxley Reforms to Criminal Penalties. Passed after the Enron-WorldCom debacles, called the White-Collar Crime Penalty Enhancement Act of Substantially increases penalties for corporate crimes. 2.Mail and wire fraud penalties to 20 years.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 9 A. General Principles 4.Indemnification of Crime Victims. Penalties are paid to the government. (A)Action for Damages. Victims can bring civil lawsuit against wrongdoer. (B)Indemnification of Unjustly Convicted.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 10 B.White-Collar Crimes 5.Conspiracies 6.Crimes Related To Production Competition, And Marketing 7.Money Laundering 8.Racketeering 9.Bribery 10.Commercial Bribery

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 11 B.White-Collar Crimes 11.Extortion And Blackmail 12.Corrupt Influence 13.Counterfeiting 14.Forgery 15.Perjury 16.False Claims And Pretenses 17.Bad Checks 18.Credit Card Crimes

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 12 B.White-Collar Crimes 19. Embezzlement 20. Obstruction Of Justice: Sarbanes-Oxley 21. Corporate Fraud: Sarbanes-Oxley 22. The Common Law Crimes

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 13 B. White-Collar Crimes 5.Conspiracies. [LO.5] 6.Crimes related to Production, Competition, and Marketing. (A)Improper Use of Interstate Commerce. (B) Securities Crimes.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 14 B. White-Collar Crimes 7.Money Laundering. ―Money Laundering Control Act (2000), amended by Patriot Act and Bank Secrecy Act. Conspiracies. ―Patriot Act expands coverage to different money accounts, and banks are more involved in supervising accounts. 8.Racketeering. (A) Criminal and Civil Applications. (B) Expanding Coverage.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 15 B. White-Collar Crimes 9.Bribery. 10.Commercial Bribery. 11.Extortion and Blackmail. (A) Extortion: public officer makes illegal demand on nonofficial. (B)Blackmail: nonofficial makes illegal demand on public official.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 16 B. White-Collar Crimes 12.Corrupt Influence. (A)Improper Political Influence. (B)Foreign Corrupt Practices Act. 13. Counterfeiting. 14.Forgery. 15.Perjury.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 17 B. White-Collar Crimes 16.False Claims and Pretenses. (A)False Claims. (B)Obtaining Goods by False Pretenses. (C)Unauthorized Use of Automated Teller. (D)False Information Submitted to Banks. 17.Bad Checks. 18.Credit Card Crimes. 19.Embezzlement.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 18 B. White-Collar Crimes 20.Obstruction of Justice: Sarbanes-Oxley. –Felony for anyone (including company employees, auditors, attorneys, and consultants, “to alter, destroy, mutilate, conceal, cover up, falsify or make a false entry with the “intent to impede, obstruct, or influence the investigation or proper administration of any matter within the jurisdiction of any department or agency of the United States.”

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 19 B. White-Collar Crimes 21. Corporate Fraud: Sarbanes-Oxley. –Sarb-Ox created new crimes of mail and wire fraud. Corporate officers must now certify their financial statements when issued.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 20 B. White Collar Crimes 22.The Common Law Crimes. [LO.6] (A)Larceny. (B)Robbery. (C)Burglary. (D)Arson. (E)Riots and Civil Disorders.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 21 C.Criminal Law and the Computer 23. What Is A Computer Crime? 24. The Computer As Victim 25. Unauthorized Use Of Computers 26. Computer Raiding 27. Diverted Delivery By Computer

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 22 C.Criminal Law and the Computer 28. Economic Espionage By Computer 29. Electronic Fund Transfer Crimes 30. Circumventing Copyright Protection Devices Via Computer 31. Spamming

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 23 C. Criminal Law and the Computer 23.What is a Computer Crime? [LO.7] –The unauthorized taking of information from a computer is now a crime under both federal and state statutes. –A computer crime is committed only by person having knowledge or use of a computer.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 24 C. Criminal Law and the Computer 24.The Computer as ‘Victim.’ (A)Theft of Hardware. (B)Theft of Software. (C)Intentional Damage. (D)Diverting Delivery by Computer. 25.Unauthorized Use of Computers.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 25 C. Criminal Law and the Computer 26.Computer Raiding. 27.Diverted Delivery by Computer. –Involves logistics and supply chains. 28.Economic Espionage by Computer. –Economic Espionage Act: felony to steal, appropriate, or take, copy, duplicate, sketch, draw, photograph, download, upload, alter, destroy, replicate, transmit, deliver, send, mail, or communicate a trade secret.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 26 C. Criminal Law and the Computer 29.Electronic Funds Transfer Crimes. 30.Circumventing Copyright Protection Devices via Computer. –DMCA makes federal offense to circumvent copyright holders protection of their intellectual property. Example: circumventing DVD’s or CD’s for copying. 31.Spamming.

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed. 27 D. Criminal Procedure Rights For Businesses 32. Fourth Amendment Rights For Businesses 33. Fifth Amendment Self-Incrimination Rights For Businesses 34. Due Process Rights For Businesses

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed Fourth Amendment Rights for Businesses. [LO.8] (A)Search and Seizure: Warrants. The Fourth Amendment protects against unreasonable searches. (B)Exceptions to Warrant Requirement: Emergencies and Plain View.  Dow Chemical v. U.S.: plane taking pictures of manufacturing plant did not need a warrant because plant was in plain view of public. D. Criminal Procedure Rights for Businesses

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed Fourth Amendment Rights for Businesses. (C) Business Records and Searches. (D) Protections for Privileged Records and Documents. –Includes: attorney-client privilege and other privileges. D. Criminal Procedure Rights for Businesses

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed Fifth Amendment Self-Incrimination Rights for Businesses. (A)Self-Incrimination. The Fifth Amendment protects against self-incrimination and provides due process. DOES NOT apply to corporations, only individuals. Disclosures of corporate records must be made.  Georgia v. Randolph: wife cannot overrule husband’s objection to search or waive his right to privacy. D. Criminal Procedure Rights for Businesses

© 2011 Cengage Learning. All Rights Reserved. May not be copied, scanned, or duplicated, in whole or in part, except for use as permitted in a license distributed with a certain product or service or otherwise on a password-protected website for classroom use. Twomey-Jennings, Anderson’s Business Law and the Legal Environment, 21 st Ed Fifth Amendment Self-Incrimination Rights for Businesses. (continued) (B)Miranda Rights. 34.Due Process Rights for Businesses. –Due Process is the right to be heard, question witnesses, and present evidence before any criminal conviction. Sixth Amendment requires a speedy trial. D. Criminal Procedure Rights for Businesses