A white-collar crime is defined as “the illegal act of deceit, concealment or violation of trust, without violence or physical force to achieve financial gain within a company or organization" (Fbi.gov, 2017). White- collar crimes can be devastating to companies and commit them to financial hardship. Furthermore, organizations and individuals that commit such crimes has a sole purpose of obtaining money or other services from their act. Throughout the years there have been numerous cases of white-collar crimes that have defrauded a numerous of companies and individuals. Substantial amounts of acts that may constitute a white-collar criminal act are embezzlement, bank fraud, tax fraud, health care fraud and money laundering.
WorldCom was one
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That number rose to 11 billion dollars in total asset that was subsequently inflated. In 2002, Ebbers resigned and two months later, his financial officer was fired (Scharff, 2005). The investigation followed by members of Ebbers executive team arrested and charged with securities fraud. Subsequently, Ebbers was charged with conspiracy to commit, securities fraud, and several counts of falsifying files with the Security and Exchange Commission he was later on sentenced to 25 years in a federal prison.
The WorldCom scandal and bankruptcy caused investors billions of dollars as well as numerous downsizing of employees. Furthermore, numerous customers ended up leaving the company with hopes to seek other opportunities with other companies that can provide them with sophisticated service that would not overcharge them and fraud them out of their money. Many individuals as well as investors received monetary settlements from the company, which also played a major role in WorldCom filing for bankruptcy in
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Furthermore, the Oxley act also mandated strict guidelines and reforms to improve the financial sector as well as the disclosures that corporations provide to the securities board in which would help prevent them from committing accounting fraud (Fbi.gov, 2017). This particular act was created, after major companies with public scandals such as Enron Corporation, and WorldCom committed fraud on its investors’. Such act will require legitimate confidence with financial statements as well as crucial penalties for financial crimes committed by companies or