Corporate Crime Deterrence: A Systematic Review
Sally S. Simpson, Melissa Rorie, Mariel Alper, Natalie Schell-Busey
With William S. Laufer and N. Craig Smith
A Systematic Review Campbell Systematic Reviews 2014:4
Focusing on legal and administrative prevention and control strategies, this systemic review and meta-analysis examines the effect of legal and administrative interventions such as new laws or changes in laws, inspections by regulatory agencies, punitive sanctions and non-punitive interventions aimed at deterring or controlling illegal behaviors by firms and their representative managers. The review process identified nearly 30,000 studies that were potentially relevant for inclusion, but only 265 met the eligibility criteria for the systematic review.
Taken as a whole, our basic findings are inconclusive regarding treatment effects. Looking at the specific mechanisms, the impact of law on corporate crime showed a modest deterrent effect at the firm and geographical level of analysis (there was not enough data to calculate effect sizes for individuals) but only for cross sectional studies. Punitive sanctionsalsoreveal a tendency toward deterrence across units of analysis, but with relatively few effects are significant regardless of study design. The one area where there appears to be a consistent treatment effect is in the area of regulatory policy,but only at the individual level. Effects for other levels are contradictory (with some positive and others iatrogenic) and none are statistically significant. Multiple interventions is the only treatment category to demonstrate a small but consistent treatment effect at both the individual and company level. Although there are not enough studies to thoroughly test this approach as it applies to corporate deterrence, recognizing the need for different types and levels of interventions is consistent with the enforcement pyramid developed by Braithwaite and the pulling levers “varied menu” of sanctions (Kennedy, 1997) which have showed promise in the prevention and control of violence (Braga and Weisburd, 2012).
The overall objective of this research is to identify and synthesize published and unpublished studies on formal legal and administrative prevention and control strategies—i.e., the actions and programs of government law enforcement agencies, legislative bodies, and regulatory agencies on corporate crime. This review has considered all types of legal and regulatory practices as long as corporate crime prevention and control was part of the outcome. The study provides a systematic assessment and meta-analysis of the effectiveness of the identified strategies and programs. - Sally S. Simpson, Principal Investigator
Building a Federal Statistical Series on White Collar Offending (grant funded by the Bureau of Justice Statistics).
This project has multiple objectives: (1) to propose a definition of white-collar crime that is consistent with data currently held by BSJ and data developed and utilized by regulatory agencies; (2) to identify regulatory agencies with whom BJS can partner to build a more comprehensive data set and specify how agency cooperation will be sought; (3) to map how regulatory agencies process offenses, especially identifying similarities and differences in legal/legislative authority, decision processes, available sanctions, levels of analysis, and ultimately the kinds of data collected in processing across agencies so that BJS can develop and implement the means to standardize coding and presentation of data across the variety of data sources; (4) to describe the kinds of regulatory agency data that are available on-line and the challenges associated with extracting and converting these data into statistical tables; and (5) to propose a pilot analysis using data from a sample of federal judicial districts that will integrate individual case-level data on regulatory actions and criminal and civil actions to assess the “totality” of sanctions imposed on white-collar offenders. - Sally S. Simpson, Principal Investigator (with Peter C. Yeager, Boston University)
Public Willingness to Pay for White-Collar Fraud Control.
Funded by the National Institute of Justice, this study provides policy-relevant evidence on the public’s attitudes towards white-collar and corporate frauds. In particular, the study will offer (1) new evidence on the cost of white-collar and corporate frauds, (2) an assessment of how the public’s willingness-to-pay might vary with policy alternatives such as civil versus criminal adjudication, and (3) a comprehensive analysis of how the public’s willingness-to-pay varies by the information provided on factors (e.g., details of the offense, the offender, the victim, and the institutional approach to handling the offense). We also will explore the feasibility of collecting self-report data on fraud offending. Data for this research will be collecting using knowledge panel survey methodology. - Sally S. Simpson, Co-Principal Investigator (Mark A. Cohen, Vanderbilt Co-Principal Investigator, and Tom Laughran, University of Maryland, Co-Principal Investigator)
Publications and Reports
C-BERC researchers have a proven publication track-record with many papers accepted for journal publication and presentations at industry and academic conferences. The following are examples of some of the research produced by the faculty, fellows and students affiliated with C-BERC.
Schell-Busey, Natalie, Sally S. Simpson, Melissa Rorie, and Mariel Alper. “What works? A Systematic Review of Corporate Crime Deterrence.” Criminology & Public Policy. Available online. 21 MAR 2016 | DOI: 10.1111/1745-9133.12201. In print, May, 2016.
Sally S. Simpson and Melissa Rorie, Economic Fluctuations and Corporate Crime. Chapter 16, The Oxford Handbook of White-Collar Crime (Van Slyke, SR, Cullen, FT., and Benson, ML., Volume Eds.; Tonry, M., Series Ed.). Oxford, UK: Oxford University Press. 2016.
Sally S. Simpson and Peter C. Yeager, 2015. Building a Comprehensive White-Collar Violations Data System, Final Technical Report. Bureau of Justice Statistics grant # 2012-R2CX-K016. NCJRS. March 15th.
Sally S. Simpson, Carole Gibbs, Lee Ann Slocum, Melissa Rorie, Mark Cohen, and Michael Vandenbergh. “An Empirical Assessment of Corporate Environmental Crime Control Strategies.” Journal of Criminal Law and Criminology 103 (1): 231-278, 2013.
Stephen E. Loeb, " Education in Accountancy and Social Control: Questions and Comments," Issues in Accounting Education, (November 2012), pp. 1059-1069.
T. Leigh Anenson, Clean Hands and the CEO: Equity as an Antidote for Excessive Compensation(with Donald O. Mayer), Vol. 12, University of Pennsylvania Journal of Business Law 101-165 (2010) (lead article)
David Maimon (Principal Investigator), with co-investigators Sally S. Simpson, Alan Neustadtl, and William Rand. Offending and Victimization of Corporate America: A Blueprint for Estimating the Prevalence of Known White Collar and Cybercrime Incidents in the US. BSOS Dean’s Research Initiative, $30,000.
Sally S. Simpson (Principal Investigator) with Co-PIs Debra Shapiro, Christine Beckman, and Gerald S. Martin (American University). Preventing and Controlling Corporate Crime: The Dual Role of Corporate Boards and Legal Sanctions. National Institute of Justice, $404,978.
Dr. Sally S. Simpson
“Building a Corporate Violations Data Series from Administrative, Civil, and Criminal Data: Lessons Learned” (with Peter C. Yeager). A Presentation to the National Research Council Panel on Modernizing the Nation’s Crime Statistics. August 4, 2015.
“What does Science Offer Corporate Criminal Justice?” National Academy of Sciences Planning Meeting, sponsored by NAS Committee on Law and Justice and the Zicklin Center of the Wharton School. June 3, 2015.
Michael J. Hindelang Lecture, “What Works in Corporate Crime Prevention and Control: Evidence from a Meta-Analysis.” University at Albany. April 30, 2015.
“The Origins of Corporate Criminality: Redux.” Mark A. Cohen, Sally S. Simpson, and Jacqueline Ghislaine Lee. Conference on Corporate Crime & Financial Misdealing. Program on Corporate Compliance and Enforcement. New York University School of Law. April 17, 2015.