Question 1

Which of the following is said to be an incentive for senior managers and directors to remain uninformed about illegal activities happening in large corporations?

Accepted Answer

The courts have not imposed a duty on directors to uncover corporate wrongdoing, which may lead to senior managers and directors remaining uninformed about illegal activities happening in large corporations. This lack of legal obligation may also act as an incentive for them to turn a blind eye to unethical or illegal practices, as they are not directly responsible for uncovering and addressing them.

Question 2

Which of the following is true about the nature of corporate crimes?

Accepted Answer

Corporate crimes can involve a group of individuals within a corporation who are able to achieve larger-scale crimes than what they could accomplish as individuals. This can include things like embezzlement, fraud, and price-fixing. While insider trading may be one type of corporate crime, it is not the most common or defining characteristic of the nature of corporate crime.

Question 3

Alini reported that over 200,000 people in Canada had their tax returns adjusted by Canada Revenue Agency.What was the reason their tax returns were adjusted?

Accepted Answer

The passage does not mention any other reasons for the tax returns being adjusted, so A is the best answer.

Question 4

"Corporations are subject to the same laws as natural persons." What is the common term for the legal concept expressed in this statement?

Accepted Answer

The common term for the legal concept expressed in this statement is "juristic person," which refers to a legal entity that is not a natural person but is recognized as having legal rights and responsibilities similar to those of a natural person. This concept applies to corporations, which are considered juristic persons under the law and are therefore subject to the same laws and regulations as natural persons. Options A, B, and D are unrelated concepts that do not apply to this statement.

Question 5

Which of the following best represents the "criminogenic market structure"?

Accepted Answer

Criminogenic market structure refers to competitive market environments that exert pressure on companies, managers, and employees to commit illegal acts to stay competitive or achieve certain financial goals.

Question 6

Which type of blue-collar business appears to have significant fraud associated with it?

Accepted Answer

Auto repair businesses have been found to have significant fraud associated with them, including overcharging for unnecessary services, charging for services not performed, and charging for new parts but installing used parts.

Question 7

What has been the impact on Canadian Volkswagen executives as a result of their fraudulent representation of the "clean diesel"?

Accepted Answer

The impact on Canadian Volkswagen executives from the fraudulent representation of the "clean diesel" was primarily legal and financial, leading to a class action lawsuit that resulted in a multi-billion dollar settlement. However, no criminal charges were laid against them specifically in Canada related to this issue.

Question 8

What was the decision by the Ford Motor Company when they discovered that drivers of the Ford Pinto could die in fires ignited by the car being rear-ended?

Accepted Answer

The Ford Motor Company decided it would be cheaper to pay for lawsuits brought by the families of Ford Pinto drivers who had been burned to death than to fix the design flaw that caused the fires. This decision was highly controversial and criticized for prioritizing profits over safety.

Question 9

Which of the following is the term for a type of fraud where stock promoters take a worthless company,invent a story about how profitable the company will be,spread that story so that people to buy the stock,and then sell the stock realizing a profit?

Accepted Answer

This scenario describes a classic "pump and dump" scheme, where promoters inflate the value of a stock through misleading information and then sell their shares at a higher price, leaving other investors to suffer losses.

Question 10

According to the textbook,what were the most widely publicized cases of unprofessional conduct in recent years?

Accepted Answer

The textbook states that sexual abuse by members of the clergy has been the most widely publicized case of unprofessional conduct in recent years.

Question 11

Which of the following best describes a belief held by judges who have sentenced white-collar offenders relatively leniently?

Accepted Answer

Judges who have sentenced white-collar offenders relatively leniently believe that their loss of a job, professional license, or status is sufficient punishment since these offenders are not typically viewed as dangerous to society and are unlikely to reoffend in the future. This is often referred to as the "collateral consequences" or "civil death" punishment.

Question 12

What strategy is perceived to be the most effective in reducing misconduct among large corporations?

Accepted Answer

Aggressive regulation and enforcement is the most effective strategy in reducing misconduct among large corporations. This includes strict laws and penalties for white-collar crimes and increasing the scope and resources of regulatory bodies. Monitoring bank accounts or infiltration by undercover law enforcement may not always be effective and reducing the size of corporations may not address the root cause of misconduct.

Question 13

What is the name of the fraud in which investors are promised substantial returns on an investment,but there is in fact no investment and existing investors are paid off with money from new victims.

Accepted Answer

This describes a classic Ponzi scheme in which returns are paid out to investors from the money of new investors rather than from actual investments or profits. This scheme is named after Charles Ponzi, an Italian immigrant who famously ran such a scheme in the early 20th century. The other answer options are not appropriate descriptions of this type of fraud.

Question 14

What was the nature of the accounting scandal that Enron executives were engaged in?

Accepted Answer

Enron executives engaged in manipulating the company's financial statements by hiding debts and losses, inflating profits, and artificially increasing the stock price through dubious accounting practices. They also used off-balance-sheet special purpose entities to conceal debt and avoid scrutiny.

Question 15

Which of the following best represents an example of "executive disengagement"?

Accepted Answer

Executive disengagement refers to the action of corporate executives who knowingly disregard facts that could impact ethical decision-making, such as ignoring unethical financial decisions made by employees. Choices A, B, and D do not accurately represent executive disengagement.

Question 16

About what percentage of the Canadian workforce reported either having committed fraud against their employer or witnessing someone committing fraud during the previous year,according to a 2001 survey by Ernst & Young?

Accepted Answer

According to the 2001 survey by Ernst & Young, about 25% of the Canadian workforce reported either having committed fraud against their employer or witnessing someone committing fraud during the previous year.

Question 17

The social movement against white-collar crime beginning in the 1970s has resulted in a move toward which of the following in Canada?

Accepted Answer

The answer of The social movement against white-collar crime beginning...

Question 18

The textbook argues that the justice system does not deal with white-collar crimes effectively.Which of the following is one of the reasons given as to why these crimes are not dealt with more effectively by the justice system?

Accepted Answer

The textbook states that white-collar crime is complex and costly to prosecute, which can hinder the justice system's ability to effectively deal with these crimes. The other options (A, C, and D) are not mentioned as reasons why white-collar crimes are not dealt with effectively.

Question 19

According to the textbook,why are civil suits against corporations often unsuccessful?

Accepted Answer

Civil suits against corporations often result in limited liabilities for the corporation because of legal protections and limited liability laws. These laws protect the corporation's assets and limit the amount of damages they can be held responsible for, making it difficult for individuals to successfully sue corporations for large amounts of money.

Question 20

What was the focus of the Truth and Reconciliation Commission's investigation?

Accepted Answer

The focus of the Truth and Reconciliation Commission's investigation was to uncover and address the abuse suffered by Indigenous children in residential schools. The investigation was aimed at facilitating the process of reconciliation and addressing the harms suffered by Indigenous peoples as a result of colonization and systemic oppression. The other options mentioned (insider trading, selling stocks, fraudulent prescriptions) are unrelated to the focus of this investigation.

Quiz 17: Corporate and White-Collar Crime