White Collar Crime or Corporate Crime is not something that gets much public condemnation as criminal crimes in our country. There can be many reasons for this, from the corruption that pervades the core of our society to the almost necessary prerequisite of paying bribes in government institutions to get ahead in the lines. But corporate crime is a very real thing – often that the perpetrators get away with due to the difficulty of detecting it in time as it skirts the lines between legal and illegal.
So what constitutes white-collar crimes? The most common include insider trading, fraud, bribery, forgery, Ponzi Schemes, money laundering, cybercrime, identity theft, embezzlement, and copyright infringement. Business owners need to be especially aware of this, as missing finances are very common – and a sign of running a poor business. This also affects the bottom line and can even result in businesses closing down as fraudulent activities grow in scale causing the crash from within or government intervention in cases of humongous scale.
So how do business owners deal with this threat in light of the difficulty involved in catching the perpetrator/s? Well, the proverb – prevention is better than cure works perfectly for white collar crime as it is easier to prevent than to get justice or recover losses. This blog discusses a few policy ideas that might help any entrepreneur or seasoned business owner prevent white-collar crimes in their organization.
Table of Contents
Hire a Corporate Lawyer
It is important to hire corporate lawyers Chandigarh before starting a company in Chandigarh, for example. These people can assist you with various legal matters that a small or emerging business may need to deal with. On top of that, they can also advise you on various matters like how to prevent or minimize the chances of corporate crime from happening.
And still, if a corporate crime does occur, they can even advise on the legal action or direction to take. Companies like Lex Solutions can also be consulted, who provide legal advice to corporate entities too.
Focus on Employee Training and Corporate Culture
There is a great need to instill work ethics in employees. That can only be done if the management sets a great example. Regular employee feedback systems should be implemented to assess the likelihood of dissatisfaction that might lead to misconduct. Similarly, some measures must be implemented in the training programs of employees, such as:-
Segregation of Duties
There should be clear segregation of duties between employees. Limiting who can do what and limiting access to specific resources to only those who might need them to perform their duties effectively can limit the opportunities for foul play. It also makes it easier for law enforcement if a crime does occur by limiting suspect pools.
In many ways, the best method for protecting potential victims and preventing white-collar crime is to alert inexperienced individuals to the risks of engaging in speculative deals. These victims are the low-level employees who might be tempted to commit or forced to participate in or cover up white collar crime.
Creating and promoting a work culture based on principles of ethics, transparency, and doing good for the people will go a long way in preventing corporate crime. The best corporate lawyer in Chandigarh would go on to advise you that it is important that ethical behavior is consistent even at the top of the corporate ladder in your company.
Have Control Systems in Place
Even with proper training and a value system in place, individuals will fall into the temptation of getting rich easily. To prevent that, companies should have various levels of control systems or measures in place that will discourage and limit opportunistic behavior that can be harmful to the company. Lex Solution proposes 3 primary solutions:
- Having some sort of monitoring software that does not violate the employees’ personal rights while still keeping track of their actions of company systems
- Having a dedicated anonymous tip-off line for internal or external whistleblowers
- Restricting access to potentially dangerous sites
- Regular internal audits
Have More Women on Boards
According to Forbes and a team of European researchers who analyzed bank misconduct fines. Companies have fewer instances of misconduct when there are women on corporate boards. A study by researchers from York University, China Europe International Business School, and the Open University of Hong Kong believes that companies that include more women on their boards statistically commit lesser and less serious white-collar crimes.
Monitor Entry & Exit Processes
Background checks while onboarding new employees should be thorough and done with due diligence. This can play an important role in preventing white-collar crimes as perpetrators of these types of financial crimes often do it again, with higher stakes as their confidence increases.
Exit interviews should be conducted respectfully so they might reveal any instance of corporate misconduct or toxicity. Listening to feedback can go a long way in preventing potential crimes.
Prioritize Internet Regulations and Cybersecurity
Legal consultants in Chandigarh would also advise you to spare no expenses in internet security, as most company data will be housed or accessible online. Employing a technical security team is most prudent. Internet usage by employees should also be restricted to some degree. Education on cyber security measures should be provided to all employees and it is also prudent to have insurance in case of privacy breaches by hackers.
We can conclude by agreeing that being a business owner fighting against corporate crime is no easy task. However, there are many slight tweaks in policy one can make to make corporate crime harder to commit while reducing the profit one can make from committing it. That is the strategy that legal firms like Lex Solution employ while advising businesses on how to prevent white collar crime.
1. Are white-collar crimes always of financial nature?
No. White most of the common white-collar crimes involve financial fraud, it may not be too like in the case of identity theft. However, they always have some financial implications.
2. What can be done to improve network security for hackers?
Internal servers, professional-grade firewalls, local area networks, and dedicated tech support teams can all implore the network security of a company.
3. Is diversity important in discouraging white collar crime?
Yes. Many studies show how diversity in an organization can improve the chances of its employees committing less white collar crime.
4. Can I block my employee’s use of social media to prevent corporate crime?
No. That borders on toxicity on the employer’s part and might encourage corporate crime instead of reducing it. Not to mention a violation of rights. However, employees can be denied access to internal information that is not relevant to their duties and their access to several harmful sites can be blocked.