Business Law ch. 7

Perjury occurs

in oral and written forms

Due process rights apply to

individuals only

The Fifth Amendment to the United States Constitution's protection against self-incrimination applies to

individuals only

Federal Sentencing Guidelines

( U.S sentencing guidelines) apply to federal crimes such as securities fraud, antitrust violations, racketeering, theft (embezzlement), Medicare fraud, and other business crimes. -The sentencing guidelines permit a judge to place a guilty company on probation, with the length of the probation controlled by whether the company had prevention programs in place. O

Misdemeanor

(n.) a crime or offense that is less serious than a felony; any minor misbehavior or misconduct

A crime consist of 2 elements

1. mental sate( scienter or intent) 2. Act or Omission

Under the Sarbanes-Oxley (SOX) obstruction of justice provision, auditors must retain working papers related to a client's audit for at least:

10 years

Officers and Agents of Corporations

Can be liable for employees' conduct if they knew and failed to act

The Racketeer Influenced and Corrupt Organizations (RICO) Act is a product of:

Congress

Corporations are entitled to Fifth Amendment protection.

False

The Sarbanes-Oxley Act (SOX) made minor adjustments to penalties and prison sentences for executives of companies.

False; The White Color Crime Penalty Enhancement Act of 2002- federal reforms passed as a result of the collapses of companies such as Enron; provides for longer sentences and higher fines for both executive and companies.

Blackmail and extortion the same?

False; blackmail is the act of threatening someone with publicity about a matter that would damage the victim's personal or business reputation. Extortion-illegal demand by a public officer action with apparent authority.

The Fourth Amendment warrant requirement does not apply to businesses.

False; exceptions include are emergencies, such as a burning building, and the "plain-view" exception, which allows law enforcement officials to take any property that anyone can see, for no privacy rights are violated when items and property are left in the open for members of the public to see.

White-collar crimes generally involve violence.

False; generally considered business crime, the type committed generally in the course of doing business and usually involving some form of deceit used to get gains.

Larceny is best defined as the taking of personal property from the presence of the victim by the use of force or fear.

False; the wrongful or fraudulent taking of the personal property of another by any person with fraudulent intent. Shoplifting is a common form of larceny.

Miranda Rights

Miranda v. Arizona warning required to prevent self- incrimination in a criminal matter.

racketeering

Organized illegal activities by gangsters; dishonest and fraudulent business dealings

Federal Laws Targeting Officer and Director Criminal Responsibility

Proof of fraud requires something more than an officer just being an officer at the company—there must be active engagement in operations that led to the officer's committing fraud or some underlying crime, such as bribery that led to the company problems and loss in value.

Sixth Amendment

Right to a speedy trial

Sally operates a large manufacturing firm near a federal land preserve known for its waterfowl and fauna. The federal government has just filed suit against Sally and her corporation, charging them with criminal violations of various environmental protection statutes. What rights do Sally and her corporation have that are guaranteed under the United States Constitution?

The Fourth Amendment requirement that a search warrant be issued before any search is conducted applies both to Sally's property and to that of the corporation. The Fifth Amendment right against self-incrimination applies to Sally, but not the corporation. Further, both Sally and the business organization are entitled to due process.

Racketeer Influenced and Corrupt Organizations (RICO) Act

The law was designed primarily to prevent individuals involved in organized crime from investing money obtained through racketeering in legitimate business.

Corporate managers found guilty of masterminding any criminal activity must be sentenced to prison time

True

Destroying information stored on a computer may be a crime.

True

The Foreign Corrupt Practices Act applies to businesses with their principal offices located in the United States.

True

The Racketeer Influenced and Corrupt Organizations (RICO) Act authorizes both criminal and civil actions.

True

Embezzlement involves fraud.

True; Embezzlement is the fraudulent conversion of another's property or money by a person to whom it has been entrusted.37

A computer crime generally can only be committed by a person having some knowledge of the operation of a computer.

True; Just as stealing an automobile requires knowledge of how to operate and drive a car, so the typical computer crime requires the knowledge of how the computer works.

Forgery includes signing another person's name to a check with the intent to defraud.

True; it may also consist of making an entire instrument or altering an existing one.

The issuing or delivery of a forged instrument to another person constitutes the crime of counterfeiting a forged instrument

True; uttering

Forfeiture

When a defendant is convicted of a crime, the court may also declare that the defendant's rights in any property used or gained from a crime (an instrument of that crime) be confiscated.

The unauthorized use of a computer belonging to someone else is

a crime in some states.

A crime generally consists of:

a mental state and an act or omission.

conspiracy

a secret plan by a group to do something unlawful or harmful

Conspiracy means ____ committing a criminal act.

all of the above

Penalties for crimes are:

always paid to the government.

Blackmail is defined as

an illegal demand made by a NON PUBLIC official.

Which of the following is NOT a common law crime?

blackmail

Counterfeiting is

both a federal and state crime.

The Fourth Amendment to the United States Constitution's protection against unreasonable searches applies to

both homes and businesses

Crimes are generally defined and their punishments specified by

codes and statues

Fifth Amendment

constitutional protection against self-incrimination; also guarantees due process.

Corporate Liability

corporations are held responsible for the acts of their employees; also held liable for crimes based on the failure of its employees to act.

Felony

criminal offense that is punishable by confinement in prison for more than one year or by death, or that is expressly stated by statute to be a felony.

White-collar crimes:

do not involve the threat or use of force or violence.

Mental State

does not require an awareness or knowledge of guilt.

The Patriot Act

expands the coverage of the law from banks and financial institutions to anyone involved in financial transactions, which includes securities brokers; travel agents; those who close real estate transactions; insurance companies; loan or finance companies; casinos; currency exchanges; check-cashing firms; auto, plane, and boat dealers; and branches and agencies of foreign banks located in the United States.

When a defendant is convicted of a crime, the court may also declare that the defendant's rights in any property used or gained from the crime be confiscated. This is known as __________.

forfeiture

Bribery is defined as:

giving money, property, or any benefit to a person to influence that person's judgment.

bribery

is the act of giving money, property, or any benefit to a particular person to influence that person's judgment in favor of the giver.

Money __________ involves the knowing and willful participation in a financial transaction involving unlawful proceeds when the transaction is designed to conceal or disguise the source of the funds.

laundering

he Economic-Espionage Act (EEA)

makes it a crime to transfer proprietary files, documents and information from a computer to an unauthorized person.

Sarbanes-Oxley (SOX):

provides for both fines and jail time for corporate fraud

predicate act

qualifying underlying offense for RICO liability

James Smith, a health inspector for the state of Missouri, inspected a restaurant owned by Salley Slick. Smith found numerous health violations in the restaurant and fined Slick accordingly. When Smith notified Slick of the infractions, Smith strongly suggested that $5,000 "would sure prove handy in the Spring" when he planned to purchase a new fishing boat. Slick understood Smith's obvious hint and offered Smith $5,000 if he would lose the paperwork concerning the failure of the restaurant to meet proper inspection guidelines. Smith accepted the $5,000 and lost the paperwork. One month later, Smith returned to the restaurant and told Slick that he would reappear every month and find violations unless Slick produced $1,000 each month to go toward the purchase of a fleet for Smith. Slick agreed to make the $1,000 payments. What crimes have been committed by Smith and Slick?

ribery occurs when a person's judgment is influenced through the giving of something of value, such as money, to benefit the giver. Smith is guilty of soliciting a bribe and of bribery itself. Smith sought to obtain a bribe and this constituted the crime of bribery solicitation. When the money came forth and was accepted, the crime of receiving a bribe occurred. When additional sums of money were requested, based solely on the request and no actual violations, the crime of extortion (blackmail) was committed. Acting on his authority as a health inspector, Smith is threatening action not based on violations, but rather by greed. Slick is guilty of bribery of a public official to escape the payment of fines and damage to reputation that are the results of health code violations.

Burglary

the breaking and entering during the night into the dwelling house of another with the intent to commit a felony.

A computer crime generally requires that:

the criminal have some knowledge of computers.

Due Process

the right to be heard, question witnesses, and present evidence before any criminal conviction can occur.

Robbery

the taking of personal property from the presence of the victim by use of force or fear.

Racketeering is defined as:

using money derived from illegal activities to invest in legitimate businesses.

Crime

violation of the law that is punished as an offense against the state or government .