White-collar Crime Can Lead to Violence, "Red-collar Crime"
June 4, 2011 (Savannah Morning News, Ga.) Trust no one. Or if that seems too cynical, then: Trust, but verify. The speakers at Georgia Southern University's fifth annual fraud and forensic accounting conference say anyone can be tempted to commit fraud.
That is to say, most people have a price.
It comes down to finding opportunity, being put under pressure and then rationalizing your actions.
"Thinking you don't have it (fraud) is the biggest red flag that you do have it," said Rich Brody, a professor at the Anderson School of Management at the University of New Mexico.
Brody told conference attendees Friday that white-collar "fraudsters" can become violent in some cases, hence the term "red-collar criminals."
When people are threatened with their fraud being exposed, he said, they risk the possibility of jail time, loss of respect, financial losses, embarrassment, family exile and loss of status.
Sometimes they think violence is their only way out.
And often, they aren't thinking clearly when they're cornered. They just react.
Financial motives are hard to uncover and harder to prove in court, Brody said.
He said the case of Hilton Head Island couple John and Elizabeth Calvert appears to be a red-collar crime, but proving that might be difficult.
The couple disappeared three years ago, apparently after confronting their bookkeeper, Dennis Gerwing, about missing money.
Gerwing killed himself the day police named him a person of interest in the case. The couple's bodies were never found, but they have been declared legally dead.
The Savannah-Chatham Metropolitan police has five full-time investigators in its financial crimes division, and they have more work than they can handle, said Detective Ray Woodberry.
"We could use five more people," he said.
Woodberry said the department handles all sorts of white-collar crimes, including credit card fraud, forgery, counterfeit money, identity fraud, financial Internet fraud, embezzlement and bank fraud.
More money is lost through white-collar crimes than through other types of crimes, such as burglary, robbery and car break-ins, he said.
Woodberry said he can't think of one red-collar crime case the department has investigated since he started 20 years ago.
Brody said finding paper trails and proving financial motivation for a violent crime, beyond a reasonable doubt, is difficult.
"It's probably not a high percentage, but it happens enough that you should be aware of it," he told the accountants in the audience at the Hyatt Regency.
A lot of criminals seeking money for drugs commit white-collar crimes such as identity theft or credit card or check-cashing fraud and they have the potential to turn violent, he said.
"In many cases, they're going to do anything not to get caught," Brody said.
BY THE NUMBERS
Estimated cost of fraud annually:
- Worldwide more than $2.9 trillion
- Cost of fraud for U.S. businesses annually:
Source: Richard BrodyCopyright (c) 2011, Savannah Morning News, Ga.