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White Collar Crime In The United States And One In Japan

2137 Words9 Pages

In recent years, white collar crime has gained attention due to various high-profile scandals. Regardless of country, financial crimes have the potential to negatively impact investors and related economies. As such, it is important for countries with high rates of white collar crime to have effective enforcement mechanisms in place. Of these crimes, securities fraud largely involves the manipulation of reported earnings or stock prices and can cause substantial monetary loss from investors and general distrust in the country’s economy and ability to enforce violations. In the early 2000s, two high-profile securities fraud cases, one in the United States and one in Japan, were uncovered and prosecuted by the countries’ respective governments. …show more content…

Until 2005, it could not make simple requests for securities statements from suspicious companies and individuals and did not actively search for such violations, which made enforcement exceptionally difficult (“Securities and Exchange Surveillance Commission”). However, under the provisions of the Securities and Exchange Act (SEA) of 1990, which was replaced by the Financial Instruments and Exchange Act (FIEA) in 2007, Japan operates under a disclosure system that requires stock corporations to report acquisitions of five percent or more of another company’s stock to the Ministry of Finance if the stock was acquired during on-the-floor trading (Kojima). Until 2007, this allowed corporations and individuals to acquire stock through stockbrokers to avoid reporting details about the acquisition to the government. Since then, Japan has taken several steps to enhance the transparency of public companies. In response to the globalization of world economies and mounting pressure from other nations, Japan has made significant efforts to improve its enforcement of securities violations to improve their economic standing on the world stage. While it is important to have adequate enforcement agencies for securities fraud, nations also require specific definitions and punishments for financial crimes. While the United States and Japan define securities fraud using different approaches and language, the criminal action remains similar. The United States code defines securities fraud as anyone who knowingly

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