White collar crimes are the non-violent crimes committed by high profile individuals and companies for financial gains. In most cases, those involved take advantage of the trust that exists with the victims to use deceit and trickery for personal financial gain (Horsley, 2014). In this paper, tow white collar crime cases will be discussed, critically analyzed from a criminal justice of view and concluded through the consideration of the available facts. The two white collar crimes will involve the executives of Wells Fargo and Martin Frankel.
In the year 2004, Frankel Martin was convicted of ransacking insurance companies of money worth over $200 million in Midwest. This occurred through a schemed plan of creating a private trust that would be able to conceal his illegal practices as it related to company funds. Since he had been barred from trading earlier in Ohio because of similar claims, he decided to be cunning and come up with a workable plan. He argued that he was investing in companies assets but instead stole money in acquiring a high-end home in Connecticut and also bought luxury cars.
The Wells Fargo saga occurred in 2016 when this financial and banking service provider was involved in unlawful practices. The federal regulators suggested that the company employees were creating unauthorized credit card and bank accounts secretly with the knowledge and consent of the clients, from 2011. This crime was so given that opening about 1.5 fraudulent deposit accounts and providing over half a million credit cards applications would allow them to attain extremely high financial margins and sales targets at the expense of the clients. In fact, through these unlawful practices, the employees were able to receive bonuses at the expense of the clients.
The matter regarding Wells Fargo had various criminal justice issues that required the intervention of the court to pass the right judgment. The fact that clients were charged account fees secretly and wrongly is unlawful given that they did not even realize such accounts existed. The abnormal profit margins is acceptable when all legal and financial procedures are followed and applied accordingly. This deal affected robbed clients money worth over $5billion. The consumer financial protection bureau which was founded in 2011 would take up the case.
Frankels crime involved using deception to lure eleven small insurance companies through suggesting that he would invest the finances in five insurance companies. However, instead, he diverted the cash into a Swiss bank thus defrauding the companies. In fact, he tried to attain respectability by suggesting he would give $50 million to the Vatican to found St Anne of Assisi. When he realized he was on a search, he converted his $10 million into diamonds, acquired a jet and ran away to Germany with his two women friends. He was later caught in an expensive hotel while in Germany, Hamburg. Also, he was convicted of passport fraud that he used to travel to Rome and Germany as well.
Wells Fargo strategy to boost their sales and ensure consistent financial growth through the exploitation of the clients was unlawful and immoral. The acceptable thing would have to seek the consent of customers in the opening of the deposit accounts as well as the deduction of account charges. In this pursuit, there is a possibility that the bank employees and executives thought the fees were so minute that the bank clients would not realize it. Further, the giving of bonuses by the management and executive to the employees following fraudulent deals alludes that they endorsed the practice instead of seeking the right and legal strategy to increase sales. The Consumer Financial Protection Bureau had the responsibility of determining the credibility of the financial procedure using the outlined standards, principles and rules. The professional act benefits the clients by assuring them of the safety of their money is the bank. The appropriate decision would be the refund of money in the form of fees charged on these accounts. Two top executives of Wells Fargo, Stumpf, and Carrie, would be required to provide $75 million as compensation to the clients given that they allowed the fraud to proceed under their care and authority. Also, this professional act speaks volumes to other financial institutions that fraudulent activities will bring fewer benefits and long term adverse outcomes.
The FBI and insurance regulators would have the mandate to prosecute Martin Frankel since his crime dealt with insurance and also the federal government rules and regulations. For instance, the fake passport he used to travel the world using robbed money would be relating to federal laws. The moral thing to do would be for his jet, house and luxury cars and also the diamonds to be converted to liquid money and given to the insurance company he looted. He was to serve two jail terms each sixteen years and were to run concurrently one with federal prison and another with state court at Tennessee. During his term, he would be required to help attain the assets of the insurance companies that he looted.
In conclusion, the five insurance companies looted by Frankel would have been keen from the start to ensure that the money was being invested as it ought through the provision of evidence. The decision that Wells Fargo executives should pay the money is too harsh on the two, and it should also involve the employees who executed the plans. Such a treatment would also make employees responsible and not engage in unlawful activities.
Horsley, M. (2014). White-collar crime. Shades of Deviance: A Primer on Crime, Deviance and Social Harm, 139.
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