chapter  12
23 Pages

Financial crises and fraud

A pattern emerges
WithDemelza Hall

Three significant financial crises have taken place in the United States (US): the Great Depression, the savings and loan crisis and the 2007/2008 financial crisis. All three financial crises began in the US, affecting the country’s financial sector. A significant contributory factor to each of the three financial crises listed is arguably white-collar crime. American sociologist Edwin Sutherland is heralded as the pioneer of coining the term ‘white-collar crime’ when he delivered his seminal presidential address to the American Sociological Association, entitled ‘The White Collar Criminal’. Sutherland built on the ‘criminaloid concept’ initially used by Edward Ross in 1907, who focused on businessmen who under the mask of respectability engaged in harmful acts. As a crime, fraud has been in existence since the earliest of writings; from Roman times, which saw ‘Cicero’s Virrine Orations attest multiple thefts and the fraudulent collection of tax proceeds by Verres, the Governor of Sicily’.