Recent financial fraud legislation such as the Dodd–Frank Act and the Sarbanes–Oxley Act (U.S. House of Representatives, Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, [H.R. 4173], 2010 ; U.S. House of Representatives, The Sarbanes–Oxley Act of 2002, Public Law 107-204 [H.R. 3763], 2002 ) relies heavily on whistleblowers for enforcement, and offers protection and incentives for whistleblowers. However, little is known about many aspects of the whistleblowing decision, especially the effects of contextual and wrongdoing attributes on (...) organizational members’ willingness to report fraud. We extend the ethics literature by experimentally investigating how the nature of the wrongdoing and the awareness of those surrounding the whistleblower can influence whistleblowing. As predicted, we find that employees are less likely to report: (1) financial statement fraud than theft; (2) immaterial than material financial statement fraud; (3) when the wrongdoer is aware that the potential whistleblower has knowledge of the fraud; and (4) when others in addition to the wrongdoer are not aware of the fraud. Our findings extend whistleblowing research in several ways. For instance, prior research provides little evidence concerning the effects of fraud type, wrongdoer awareness, and others’ awareness on whistleblowing intentions. We also provide evidence that whistleblowing settings represent an exception to the well-accepted theory of diffusion of responsibility. Our participants are professionals who represent the likely pool of potential whistleblowers in organizations. (shrink)

Internet fraud is an issue that increasingly concerns regulators, consumers, firms, and business ethics researchers. In this article, we examine one common form of internet fraud, the practice of shill bidding (when a seller in an auction enters a bid on his or her own item). The significant incidence of shill bidding on eBay (in spite of the fact that it is illegal just as it is in live auctions) exemplifies the current ineffectiveness of regulatory means as well (...) as the lack of effective societal mechanisms to prevent online fraud. Further, the proliferation of shill bidding along with other types of internet fraud may have broader implications. If unethical behavior such as shill bidding becomes too widespread on the internet, regulators and other societal forces may deem it necessary to institute controls that will impact the entire online marketplace as well as the future development and regulation of business activities on the internet. Our results indicate that shill bidding is perpetrated on eBay significantly more often than 0.1% rate of fraud estimated by the firm. This suggests that regulators, users, and others stakeholders may become concerned enough to act. The impact of those responses on the internet of the future may affect a broad array of users beyond the unethical sellers on eBay. (shrink)

The rising tide of corporate scandals and audit failures has shocked the public, and the integrity of auditors is being increasingly questioned. It is crucial for auditors and regulators to understand the main causes of audit failure and devise preventive measures accordingly. This study analyzes enforcement actions issued by the China Securities Regulatory Commission against auditors in respect of fraudulent financial reporting committed by listed companies in China. We find that auditors are more likely to be sanctioned by the regulators (...) for failing to detect and report material misstatement frauds rather than disclosure frauds. Further analysis of the material misstatements indicates that auditors are more likely to be sanctioned for failing to detect and report revenue-related frauds rather than assets-related frauds. In sum, our results suggest that regulators believe auditors have the responsibility to detect and report frauds that are egregious, transaction-based, and related to accounting earnings. The results contribute to our knowledge of auditors’ responsibilities for detecting frauds as perceived by regulators. (shrink)

The objective of this study is to evaluate auditors’ perceived responsibility for fraud detection. Auditors play a critical role in managing fraud risk within organizations. Although professional standards and guidance prescribe responsibility in the area, little is known about auditors’ sense of responsibility for fraud detection, the factors affecting perceived responsibility, and how responsibility affects auditor performance. We use the triangle model of responsibility as a theoretical basis for examining responsibility and the effects of accountability, fraud (...) type, and auditor type on auditors’ perceived fraud detection responsibility. We also test how perceived responsibility affects auditor brainstorming performance given the importance of brainstorming in audits. A sample of 878 auditors participated in an experiment with accountability pressure and fraud type manipulated randomly between subjects. As predicted, accountable auditors report higher detection responsibility than anonymous auditors. We also find a significant fraud type × auditor type interaction with external auditors perceiving the most detection responsibility for financial statement fraud, while internal auditors report similar detection responsibility for all fraud types. Analysis of the triangle model’s formative links reveals that professional obligation and personal control are significantly related to responsibility, while task clarity is not. Finally, the results indicate that perceived responsibility positively affects the number of detection procedures brainstormed and partially mediates the significant accountability–brainstorming relation. (shrink)

This is a theoretical treatment of the term "Sha Zhu Pan" (杀猪盘) in Chinese, which translates to “Pig-Butchering” in English. The article critically examines the propagation and validation of "Pig Butchering," an animal metaphor, and its implications for the dehumanisation of victims of online fraud across various discourses. The study provides background information about this type of fraud before investigating its theoretical foundations and linking its emergence to the dehumanisation of fraud victims. The analysis highlights the (...) disparity between academic literature, subjected to rigorous peer-review processes, and sensationalised narratives prevalent in the media. While academic works subject "pig butchering" to critical scrutiny and refrain from endorsing derogatory terms to depict fraud victims, numerous media outlets employ this term uncritically, further worsening the predicament of these victims. "Pig butchering" is firmly rooted in the concept of dehumanisation, and this article underscores how language moulds perceptions of fraud and behaviour, extending to the development of preventive strategies. The role of law enforcement agencies in generating and disseminating materials is also a central theme, emphasising their responsibility as trusted sources of information. We suggest that these agencies should adopt non-victim shaming language to encourage victims to report crimes and alleviate the stigma attached to victimisation. Additionally, the article offers valuable cross-cultural insights by comparing metaphors from Chinese and Nigerian contexts. This comparative analysis enriches our comprehension of the global dimensions of online fraud and its cultural diversities, highlighting the substantial impact of language on perceptions and behaviours. We advocate for a departure from victim-blaming tendencies perpetuated by select media outlets, urging a more compassionate and accurate portrayal of those affected by online fraud. We, therefore, call for a more empathetic and accurate portrayal of individuals affected by online fraud, aligning with the broader objective of promoting understanding and support for these victims. (shrink)

This paper examines the structural features of the U.S. Health Care System that make it particularly vulnerable to fraud, and which help to account for the types of fraud that arise and the difficulties authorities confront in controlling them. These structural features include the predominance of fee-for-service structures, private sector involvement in health care delivery and health insurance, highly automated cl aims processing systems, and a processing culture and audit mentality that emphasize process accuracy over verification. The paper (...) also discusses the underlying pathology of fraud as a white-collar crime problem, and explains how the more general challenges of controlling fraud are exacerbated by particular features of the health system. The central and unsolved problem of False Claims is examined in some detail. A series of recent governmental responses to medically impossible claims of various types is shown to align more closely with a claims-process-improvement mindset than with a crime-control approach. A more mature crime-control orientation is a pre-requisite for any serious progress in reducing the levels of fraud in the U.S. health system. (shrink)

In response to recent controversies about racial transitioning, I provide an argument that deceptions about ancestry may sometimes constitute fraud. In order to arrive at this conclusion, I criticize the arguments from analogy made famous by Rebecca Tuvel and Christine Overall. My claim is that we should not think of racial transitioning as similar to gender transitioning, because different identity groups possess different kinds of obstacles to entry. I then provide historical surveys of American racial categories and the various (...) types of passing common in American history, in order to distinguish the potentially fraudulent from the relatively innocent styles of passing. (shrink)

The purpose of this paper is to develop an understanding about the internal fraud and corruption problem in the Turkish construction industry. The reasons behind the internal fraud and corruption problem as well as the types of prevention methods were investigated; and as a result various recommendations were made. To this end, a risk awareness questionnaire was used to understand the behavioral patterns of the construction industry, and to clarify possible proactive and reactive measures against internal fraud (...) and corruption. The type of fraud experienced by Turkish construction companies was also surveyed in the questionnaire. The questionnaire was sent to 89 firms; and depending on the collected data, certain recommendations for construction industry professionals were provided. (shrink)

Fraud from the frontlines: the importance of being nice Content Type Journal Article DOI 10.1007/s11016-010-9492-2 Authors Heather Douglas, Department of Philosophy, University of Tennessee at Knoxville, 815 McClung Tower, Knoxville, TN 37996-0480, USA Journal Metascience Online ISSN 1467-9981 Print ISSN 0815-0796.

Evasion of value added tax (VAT) is a pressing criminal justice problem; however, there still are no theoretical studies on the specific nature of this offense and the basis of its legal evaluation. This article is an attempt to explain the preconditions of the origin of this type of fraud and its connection with the Value Added Tax Law, to formulate the conceptual understanding of the offense, to reveal the important aspects of its legal evaluation and to discuss (...) relevant examples from the case-law. The preconditions of VAT fraud lie in the legal nature of tax administration and the particularity of VAT regulation creating opportunities to abuse the right of deducting the overpayment from the budget or reducing the tax payable. The system of tax crimes stipulated in the Criminal Code is not sufficient to properly assess the impact and danger of VAT fraud. The judicial practice considering VAT deception as property fraud is theoretically justified and welcome. (shrink)

OBJECTIVES: To study and describe how a group of senior researchers and a group of postgraduate students perceived the so-called "grey zone" between normal scientific practice and obvious misconduct. DESIGN: A questionnaire concerning various practices including dishonesty and obvious misconduct. The answers were obtained by means of a visual analogue scale (VAS). The central (two quarters) of the VAS were designated as a grey zone. SETTING: A Swedish medical faculty. SURVEY SAMPLE: 30 senior researchers and 30 postgraduate students. RESULTS: Twenty (...) of the senior researchers and 25 of the postgraduate students answered the questionnaire. In five cases out of 14 the senior researchers' median was found to be clearly within the interval of the grey zone, compared with three cases for the postgraduate students. Three examples of experienced misconduct were provided. Compared with postgraduate students, established researchers do not call for more research ethical guidelines and restrictions. CONCLUSION: Although the results indicate that consensus exists regarding certain obvious types of misconduct the response pattern also indicates that there is no general consensus on several procedures. (shrink)

Recently, the variety of the financial frauds have increased, while the number of victims became difficult to estimate. The purpose of this paper is to present the main profiles of financial frauds’ victims using a reviewing method. The analysis captures the main theoretical and empirical background regarding the motives and circumstances of becoming a victim, the dynamics of several social and demographical characteristics of this type of victims, as well as a sample of relevant case studies from some developing (...) countries. The main finding is that, in literature, most of the victims are male people of different ages, employed, married or single, regardless the level of education. For developing countries such as China, India and Nigeria, the majority of victims act out of naivety and desire to escape from poverty, while some victims from Latin America, China and Nigeria are influenced by greed and lack of empathy, without thinking of further consequences for their families and friends involved. Moreover, most of the victims are convinced to invest in financial schemes by family members, friends, or acquaintances. (shrink)

This article investigates the social accounts employed by 11 highly paid professionals and managers for neutralizing the moral stigma of losing their job due to resume fraud. This ethnographic study, based on 66 hours of interviews, explores the retrospective sense making used by resume fraudsters to justify, personally pardon and excuse behaviour seen as morally problematic by others. In this study the resume fraudsters sampled were selected because they all found high-paying jobs after their public humiliation, and each one (...) morally disengages. They put their transgressions behind them, not by seeing the light of day or asking for forgiveness, but by pointing to the ubiquity of information distortion in their companies, the victimless nature of their so-called transgression, and, most interesting, a portrayal of themselves and their act of resume fraud as the very type of risk taking required to instil capitalism with a passion and a will to succeed. The article closes with a discussion of how moral disengagement enlarges the zone of indifference in populations and reinforces cultures in which the pursuit of amorality thrives. (shrink)

The concept of agency as applied to technological artifacts has become an object of heated debate in the context of AI research because some AI researchers ascribe to programs the type of agency traditionally associated with humans. Confusion about agency is at the root of misconceptions about the possibilities for future AI. We introduce the concept of a triadic agency that includes the causal agency of artifacts and the intentional agency of humans to better describe what happens in AI (...) as it functions in real-world contexts. We use the VW emission fraud case to explain triadic agency since in this case a technological artifact, namely software, was an essential part of the wrongdoing and the software might be said to have agency in the wrongdoing. We then extend the case to include futuristic AI, imagining AI that becomes more and more autonomous. (shrink)

A growing literature has focused on understanding how to detect and deter unethical consumer behavior. In this work, we focus on a particularly important type of unethical consumer behavior, consumer insurance fraud, and we analyze a unique dataset to understand how experts investigate suspicious claims. Two separate but related literatures inform the process of investigating suspicious insurance claims. The first literature is grounded in field research and emphasizes the importance of secondary sources. The second literature is grounded in (...) laboratory studies that emphasize the importance of interpersonal interactions. Here we draw upon both literatures to consider the importance of claimant interviews within the context of many investigative actions and the potential for claimants to avoid interviews. In an empirical study using qualitative and quantitative data from auto insurance claim investigations, we analyze investigative chronologies conducted by skilled experts. In doing so, we find that even when investigators can access information from a variety of sources such as witnesses, databases, and physical evidence, claimant interviews are the most important step in determining whether or not claims are denied or paid. Furthermore, we identify interpersonal avoidance as an important signal of unethical claimant behavior. Our findings inform deception detection theory and practice. We identify implications for deception detection in business, particularly for consumer unethical behavior and insurance fraud investigations. (shrink)

This study links Cressey’s established fraud triangle theory to a recently developed academic fraud risk triangle as a platform for identifying the determinants of academic fraud risk factors. The study then evaluates the magnitude and extent to which students are willing to confront the realities of academic fraud and move towards a culture of academic integrity. Most of the studies pertaining to combating academic fraud have primarily been the opinions of the researchers, namely, the faculty. (...) Although students may not be expected to police the fight against academic fraud, their opinions as to what would work and what would not, have not been sufficiently examined, and this study contributes to filling that void. We explore the agreement among students and groups of students concerning specific deterrent strategies. We find two types of strategies, student action and faculty/administration action . Results from 740 students surveyed found that the most widely supported strategies are stronger penalties, parental notification, an anonymous tip line, and administering a uniform policy. The least supported strategies were academic honor code, no strategy at all, requiring an ethics course, and leaving individual instructors to determine penalties. Further, full time, domestic, undergraduate, and male students favor student action strategies, which are more reactionary and less punitive. (shrink)

Organizations of all types are vulnerable to frauds. Banks contribute to a significant extent in a country’s economic development by generating a large part of revenue in the service sector. Deterrence of fraud is impossible without understanding it. The present study attempts to extract themes by highlighting the major areas of the bank fraud literature within a specific time frame of 2000–2019 and finding the research gaps citing the future scope for research. Post the review of existing literature, (...) using thematic analysis, two major themes were observed by the author, namely, “regulatory and compliance”–based studies and studies related to the “socio psychological” aspect of the literature. An examination of themes indicated that the popularity of the research areas shifted from accounting frauds or balance sheet frauds in early 2000s to areas such as cyber frauds and identity theft at the later decade. The present study paves way forward for future research on the bank customer’s vigilance, experiences and perspectives on frauds. Other significant areas of research include coping mechanisms with the various challenges faced by banks in marketing themselves after any major fraud occurrence. (shrink)

This article is devoted to the study of the nature of the influence of elections on the risks of revolutionary destabilization. The authors study different approaches to estimating the probability of revolutionary events in an election year. Different types of revolutionary events are distinguished within the framework of the level of political violence. The primary reasons for the activation of the politically active part of the population, both in autocracies and in transitional political regimes, are identified, including the factionalization of (...) elites, the activation of "sleeping" institutions, the growth of political competence among individuals, the consolidation of the prodemocratic opposition and its institutionalization, electoral fraud and other manifestations of unfair political competition, greater emotional involvement of the population in political processes, and so on. The findings support the conclusion that elections promote peaceful revolutionary episodes and reduce the likelihood of armed uprisings. The novelty of the study lies in the fact that the influence of elections on the risks of revolutionary destabilization is considered in the regime context. The authors explore how elections affect violent or non-violent revolutionary actions in certain political regimes, according to Jack A. Goldstone's typology (full autocracies, partial autocracies, factional democracies, partial democracies and full democracies). The authors conclude that holding elections reduces the risks of armed revolutionary destabilization in all types of regimes, except for factional democracies. On the other hand, unarmed revolutionary action is more likely in an election year - in all regime types except full democracies. At the same time, holding elections primarily increases the risks of unarmed revolutionary uprisings in intermediate regimes / anocracies. However, even among anocracies, factional democracies stand out, where in the election year the risks of unarmed (as well as armed) revolutionary episodes increase significantly more than in partial autocracies and in partial non-factional democracies. At the same time, for consolidated democracies, holding elections is a factor that inhibits rather than provokes revolutionary destabilization. In full autocracies, the risk of unarmed revolutionary action increases in an election year, but not as much as in intermediate regimes. (shrink)

Using two experiments, I examine how apologizing for fraud influences investor's avoidance and revenge behavior. Investors in experiment one report how many shares they would sell and how likely they would be to pursue legal punishment after discovering fraud has occurred in an organization they are currently invested in and subsequently reading about management's response to the fraud. I manipulate the nature of fraud as fraudulent financial reporting or asset misappropriation. I also manipulate whether management apologizes, (...) scapegoats responsibility, or remains silent after the fraud. Results show avoidance and revenge behavior is more negative after misreporting fraud. Data suggest that this difference may be partially attributable to the underlying moral norm that is violated. Specifically, misreporting is primarily a moral violation of deception, whereas embezzlement is primarily a moral violation of stealing. Results also show differential investor reactions depending on the type of fraud and management's response. For misreporting, revenge behavior is higher when management apologizes, but there is no effect on avoidance behavior. For embezzlement, avoidance behavior is reduced when the organization apologizes, but revenge behavior is unaffected. In experiment two, I replicate the misreporting condition from experiment one and manipulate apology sincerity. Results show that apology sincerity is positively associated with revenge behavior. Results of these two experiments extend both accounting and trust repair research by emphasizing the importance of disentangling moral integrity-based trust violations and that the adage of "just say you're sorry" is helpful in some situations and harmful in others. (shrink)

The quality and authenticity of images is essential for data presentation, especially in the life sciences. Questionable images may often be a first indicator for questionable results, too. Therefore, a tool that uses mathematical methods to detect suspicious images in large image archives can be a helpful instrument to improve quality assurance in publications. As a first step towards a systematic screening tool, especially for journal editors and other staff members who are responsible for quality assurance, such as laboratory supervisors, (...) we propose a basic classification of image manipulation. Based on this classification, we developed and explored some simple algorithms to detect copied areas in images. Using an artificial image and two examples of previously published modified images, we apply quantitative methods such as pixel-wise comparison, a nearest neighbor and a variance algorithm to detect copied-and-pasted areas or duplicated images. We show that our algorithms are able to detect some simple types of image alteration, such as copying and pasting background areas. The variance algorithm detects not only identical, but also very similar areas that differ only by brightness. Further types could, in principle, be implemented in a standardized scanning routine. We detected the copied areas in a proven case of image manipulation in Germany and showed the similarity of two images in a retracted paper from the Kato labs, which has been widely discussed on sites such as pubpeer and retraction watch. (shrink)

Do men and women perceive cybercrime types differently? This article draws on the distinction between socio-economic and psychosocial cybercrime proposed by Lazarus (2019) to investigate whether men and women hold different perceptions of digital crimes across these two dimensions. Informed by the synergy between feminist theory and the Tripartite Cybercrime Framework (TCF), our survey examined respondents’ differential perceptions of socio-economic cybercrime (online fraud) and psychosocial cybercrime (cyberbullying, revenge porn, cyberstalking, online harassment) among men and women in the United Kingdom. (...) The results revealed that women considered psychosocial cybercrime worse than men. Conversely, we found no differences between men and women with regard to socio-economic cybercrime. The article concludes that psychosocial cybercrimes are more gendered than socio-economic cybercrime, suggesting problems with the meaning of ‘cyber-enabled crimes’, and substantiating the synergy between the TCF and feminist perspectives. (shrink)

Biomedical research has increased in magnitude over the last two decades. Increasing number of researchers has led to increase in competition for scarce resources. Researchers have often tried to take the shortest route to success which may involve performing fraudulent research. Science suffers from unethical research as much time, effort and cost is involved in exposing fraud and setting the standards right. It is better for all students of science to be aware of the methods used in fraudulent research (...) so that such research can be detected early. Biomedical research is one area that seems to have attracted maximum numbers of fraudulent researchers; hence this article devotes itself to biomedical research scenario. (shrink)

Libertarian philosophy asserts that only the initiation of physical force against persons or property, or the threat thereof, is inherently illegitimate. A corollary to this assertion is that all forms of speech, including fraudulent advertising, are not invasive and therefore should be considered legitimate. On the other hand, fraudulent advertising can be viewed as implicit theft under the theory of contract: if a seller accepts money knowing that his product does not have some of its advertised characteristics, he acquires the (...) property title to the customer’s money without voluntary consent, which is theft. The balance between these two logical extensions of property rights—the right of free speech and the right of contract—lies somewhere in the area of communication philosophy, and can be explained through understanding the role of communication in human interactions. Advertising is a form of communication that may convey important information about the conditions of the proposed contract. These conditions are expressed in particular words that may have different meanings in different circumstances. Therefore to determine whether a particular example or “misinterpretation” is mere sophistry or a type of fraud, the judicial system has to approach each issue on a case-by-case basis. The border between legal and illegal should be determined by precedents and by expectations based on commonly accepted definitions of terms—what people commonly understand by the words and other forms of communication they use. (shrink)

We examine cryptocurrency fraud cases prosecuted by Nigeria's Economic and Financial Crimes Commission (EFCC). We considered the lens of the Space Transition Theory (STT) in exploring the dynamics of these digital crimes. Our data analysis reveals common types of fraud, including cryptocurrency investment schemes. The results show an exclusive male demographic (100%), with the majority under 30 years old and only a quarter possessing a degree, providing insights into the socio-demographic characteristics of cryptocurrency fraudsters. Additionally, while most fraudsters (...) (55%) targeted victims in the United States, Bitcoin, leveraging blockchain technology, was the most commonly used method (46%) for cryptocurrency fraud. Our examination of the methods and mediums used for cryptocurrency fraud supports some aspects of STT, while others do not. We advocate for a multifaceted strategy that prioritises stringent regulation, implementation, and heightened scrutiny of digital currency ecosystems in Nigeria and beyond. This study contributes to the broader discourse on cybercrime prevention and enforcement by emphasising the novel methodological approach utilised. (shrink)

Recent incidences of fraud and the growing globalization of business have focused attention on the effect of culture on ethical decision making within organizations. Because fraud can be extremely costly and is more likely to be committed by employees than persons external to the organization, employees willing to report un-ethical acts are an important supplemental control tool. The current study provides evidence of the effects of culture (Canadian and Chinese) and the type of reporting (whistle-blowing and peer (...) reporting) on reporting unethical acts within organizations. Chinese and Canadian participants were asked to respond to scenarios describing unethical acts committed within organizations. Results indicate that Chinese are more likely to report the unethical acts of peers than Canadians. Chinese also appear more likely to report the unethical acts of peers than supervisors. The results also suggest that Graham’s model of principled organizational dissent may not be applicable to Chinese and perhaps other non-Western cultures. (shrink)

Cyber risk has become one of the greatest threats to firms in recent years. Accordingly, boards of directors must be continually vigilant about this danger. They have a duty to ensure that the companies adopt appropriate cybersecurity measures to manage the risk of cyber fraud. Boards should also ensure that the firm disclose material cyber risk and breaches. We examine how the board’s gender composition can influence the extent of such disclosure, based on a sample of the companies listed (...) on the S&P/TSX 60 Index over the period 2014–2018. Results show evidence of a positive association between the presence and level of cybersecurity disclosure and board gender diversity. However, the board must boast a critical mass of at least three women before this positive impact can be observed. Our findings contribute to the debate on the importance of gender diversity by adding the concept of the positive influence of heterogeneity on cyber disclosure. We also augment the literature on the critical mass of women in boardrooms by providing empirical evidence that three or more women constitute the threshold for better governance. Our study has important implications for investors, stakeholders and regulators. If investors wish to increase cybersecurity disclosure, they should ask for more diversified boards. Our findings support regulators in their efforts to increase women’s representation on boards by providing empirical evidence of better outcomes with this type of board composition. (shrink)

We report an experiment examining the effect of three factors on professional Hong Kong liquidators' decisions to bring legal action in negligence against auditors. Factors were (a) the strength (merit) of the supporting evidence (arguable vs. overwhelming), (b) the type of alleged audit failure (failure to report financial statement errors vs. management fraud) and (c) audit firm type (Big 6 vs. non-Big 6). We find evidence that liquidators' litigation decisions are influenced by case merit. We also find (...) that liquidators were marginally more likely to institute legal action against a Big 6 than against a non-Big 6 auditor. However, we find no evidence that the type of alleged audit failure influences litigation decisions. (shrink)

This study investigated the status quo of article retractions by Chinese researchers. The bibliometric information of 834 retractions from the Web of Science SCI-expanded database were downloaded and analysed. The results showed that the number of retractions increased in the past two decades, and misconduct such as plagiarism, fraud, and faked peer review explained approximately three quarters of the retractions. Meanwhile, a large proportion of the retractions seemed typical of deliberate fraud, which might be evidenced by retractions authored (...) by repeat offenders of data fraud and those due to faked peer review. In addition, a majority of Chinese fraudulent authors seemed to aim their articles which contained a possible misconduct at low-impact journals, regardless of the types of misconduct. The system of scientific evaluation, the “publish or perish” pressure Chinese researchers are facing, and the relatively low costs of scientific integrity may be responsible for the scientific integrity. We suggested more integrity education and severe sanctions for the policy-makers, as well as change in the peer review system and transparent retraction notices for journal administrators. (shrink)

Most consumer morality studies focus on consumer immorality, i.e. different types and degrees of consumer dishonesty or deviance. This paper follows this tradition, by looking at insurance customer dishonesty. For looking at insurance customer dishonesty in a wider perspective, the paper drafts a sociology of insurance customer morality, including outlines of micro-level, meso-level and macro-level moral sociologies of insurance fraud, as well as a discussion of moral heterogeneity and a critical understanding of deviance. As a next step a few (...) empirical rsearch questions are formulated and illustrated with data from a Norwegian-German pilot study. (shrink)

Business codes are an oft-cited management instrument. But how common are codes among multinationals? And what is their content? In an unprecedented study, the codes of the largest corporations in the world have been collected and thoroughly analyzed. This paper presents the results of that study. Of the two hundred largest companies in the world, 52.5% have a code. More than half of these codes describe company responsibilities regarding quality of products and services (67%), adherence to local laws and regulations (...) (57%) and the protection of the natural environment (56%). Many codes make reference to principles governing stakeholder relations (e.g. transparency (55%), honesty (50%) and fairness (45%)), corporate core values (e.g. teamwork (43%)), appropriate conduct among employees (e.g. discrimination (44%) and intimidation (43%)) and treatment of company property by employees (e.g. conflict of interests (52%), corruption (46%) and fraud (45%)). Monitoring compliance with the code is addressed in 52% of the codes. Based on this content study, three types of codes are distinguished: the stakeholder statute (72%), the values statement (49%) and the code of conduct (46%). The results of this inquiry present a benchmark for the evaluation and development of both individual and international business codes. (shrink)

Accounting professionals play an important role in the generation and auditing of financial statements and, given their understanding of business processes, may be relied upon in the development of organizations’ ethical infrastructures (i.e., the formal aspects of an organization’s ethical environment that are explicitly under the control of the organization). Thus, understanding and improving the work environments of accounting professionals is crucial to improving organizational ethical culture and reducing fraud. In this study, we extend prior research that documents the (...) prevalence of ethical infrastructure programs by assessing how accounting professionals, a key employee group, perceive their organizations’ ethical infrastructures. In addition, we examine whether perceptions of the effectiveness of the ethical infrastructure and professional autonomy influence accountants’ ethical judgments. Based on the responses of 378 CPAs in the United States, we find the perceived state of the ethical infrastructure across accounting work environments—both public accounting firms and other organization types—is relatively strong. However, of the five ethical infrastructure components we examine (i.e., ethics code, ethics training, ethics-based punishments and incentives, ethics reporting system, and ethics review system), only 35% of respondents indicate that their organizations have more than three of these components. Importantly, we find that perceived ethical infrastructure effectiveness and professional autonomy influence both perceptions of the ethical culture and the ethical judgments of accounting professionals. We also contribute to practice by highlighting opportunities for improvement in ethics training formats, ethics-based incentives, and ethics review systems. (shrink)

I examine social capital’s impact on financial reports. Based on the social capital literature, I predict that the quality of the financial reports is higher when a firm is headquartered in a region with high social capital. Consistent with this prediction, I find that the firms that are headquartered in this type of region in the USA have a lower probability of committing fraud by misrepresenting financial information. Further, I find that the firms in regions with high social (...) capital have lower levels of discretionary accruals and much more readable annual reports. (shrink)

Historically, scientists in training have learned the rules of ethical conduct by the example of their advisors and other senior scientists and by practice. This paper is intended to serve as a guide for the beginning scientist to some fundamental principles of scientific research ethics. The paper focuses less on issues of outright dishonesty or fraud, and more on the positive aspects of ethical scientific behavior; in other words, what a scientist should do to maintain a high level of (...) ethical conduct in research.There are a number of fairly specific rules, guidelines, or commonly accepted operating principles that have evolved for the ethical conduct of science. In order to discuss this code of ethics, this paper is divided into sections dealing with specific areas of scientific ethics. These areas are: data collection and storage, ownership of data, confidentiality, communication, authorship, collaboration, the peer review system, and rules of dealing with ethical complaints. Illustrative case histories are presented to provide examples of the type of ethical dispute or problem being discussed. If scientific trainees learn the accepted rules of behavior that govern the conduct of science, ethical problems that arise out of ignorance, misunderstanding, or poor communication can be avoided. (shrink)

Hugely facilitated by the Internet, plagiarism by students threatens educational quality and professional ethics worldwide. Plagiarism reduces learning and is correlated with increased fraud and inefficiency on the job, thus lessening competitiveness and hampering development.In this context, the present research examines 48 licenciatura theses and 102 masters theses from five of Mozambique’s largest universities. Of the 150 theses, 75% contained significant plagiarism (>100 word equivalents) and 39%, very much (>500 word equivalents). Significant plagiarism was detected in both licenciatura and (...) masters theses. By using both Turnitin and Urkund to identify potentially plagiarized passages, professionally verifying whether those passages contain plagiarism, and, if confirmed, counting the words involved, the study presents a new method for classifying the quantity and significance of plagiarism. The use of two text-similarity-recognition programs also improved the rate of detection and, in some theses, significantly increased the classification of the gravity of the plagiarism encountered.Based on a broad review of the literature, the article argues that, to combat wide-scale plagiarism, academic institutions need to cultivate a consensus among faculty and students about the definition and types of plagiarism, the appropriate penalties, and the paramount professional and economic need to nurture professional ethics. However, to achieve even partial success requires significant involvement by administrators, faculty, students and student leaders guided by a holistic strategy using technological, pedagogical, administrative and legal components to prevent and detect plagiarism and then reeducate or discipline students caught plagiarizing. (shrink)

The frequency of earnings restatements has been increasing over the last decade. Restating previous earnings erodes perceived trustworthiness and competence of management, giving firms strong incentives to take actions to enhance perceived credibility of future financial reports [Farber, D. 2005, The Accounting Review 80, 539-561.]. Using an experimental case, we examine the ability of post-restatement actions taken by a firm to positively influence nonprofessional investors' perceptions of management's financial reporting credibility. Our examination considers credibility judgments following two types of restatements (...) -those resulting from fraud in which the character, ethics, and values of an organization may be called into question [cf. Copeland, Jr., J. E.: 2005, Accounting Horizons 19, 35-43.], and those resulting from non-fraud. Based on the information in the experimental case, non-professional investors take the role of potential equity investors and make a judgment about management's financial reporting credibility after reviewing a set of postrestatement actions taken by a firm. The possible actions include changes in four corporate governance mechanisms and a buyback of company stock. Our results provide an important contribution to the literature by demonstrating that among non-professional investors, perceptions of management's financial reporting credibility are affected both by the postrestatement action taken and the nature of the restatement. These results offer insight into the formation of a key credibility judgment made by non-professional investors following a trust-destroying event, an earnings restatement. (shrink)

This case recounts the founding of HealthSouth Rehabilitation, its rapid growth, financial mishandlings and the struggle former CFO Aaron Beam had in dealing with a conscience that kept him awake at night. Beam had met HealthSouth founder Richard Scrushy when applying for a job with Lifemark Hospital Corporation in Texas in 1980. After Lifemark was bought by AMI in 1983, Scrushy invited Beam to join him in the launching of his new company in Birmingham, Alabama. The uniqueness of the hospital (...) was that it would provide inpatient surgery for those who had suffered an injury, but it would also provide outpatient services such as rehabilitation, nutrition guidance and psychological counseling. This type of structure was appealing to insurance companies because it would move the patient out of the hospital much quicker and save the cost of extended hospitalization. The company experienced rapid growth and went public within three years of launch. By 1996, the top executives of the company realized that they would not be able to meet Wall Street analysts’ forecasts which would affect the price of their stock and reduce their holdings. They decided to “cook the books” temporarily to meet quarterly expectations. However, once the financial mishandling had begun, the executives found it difficult to reverse their actions and report accurate numbers to the public. Beam decided to retire from the company in 1996; and after this action, he continued to find it difficult to sleep at night because of his involvement in the fraud. The issue in the case is whether Beam should consider coming forward and revealing to the Securities and Exchange Commission how the books had been doctored so that he could salvage his damaged conscience. (shrink)

In view of recent studies that identified certain interest groups as potential whistleblowers, we propose an integrative conceptual framework to examine whistleblower behavior by whistleblower type. The framework, dubbed the whistleblowing triangle, is modeled on the fraud triangle and is comprised of three factors that condition the act of whistleblowing: pressure, opportunity, and rationalization. For a rich examination, we use a qualitative research framework to analyze 11 whistleblowing cases of corporate financial statement fraud in Canada that were (...) publicly denounced between 1995 and 2012. Our analysis indicates that whistleblowers are not only insiders but also outsiders [financial analysts, auditing firms, journalists, politicians, customers, and investors]. It also suggests that a dynamic relation may exist between whistleblowers. In addition, our findings show that most whistleblowers opt for external channels when they fail to receive an adequate response from management, seek media exposure, are interested in financial benefits resulting from the act of whistleblowing, or are interested in protecting their investment. Lastly, we propose categorizing whistleblowers into four conceptual types: protective, skeptical, role-prescribed, and self-interested. (shrink)

abstract Individuals tend to change their behaviour as a response to insurance. Such behavioural responses to insurance are commonly seen as ethically and morally problematic. This is especially true of effects on behaviour from social insurance. These effects have been seen as an ethical problem, associated with irresponsibility, fraud and an immoral character. This article discusses the relevance of four different types of reasons for claims that behavioural responses to social insurance are immoral. These reasons are independent reasons con‐tract (...) related reasons reasons related to fraud and reasons related to justice. I argue that reasons related to justice are most relevant, but that this type of reason does not render the individual morally blameworthy. Hence, insofar as behavioural responses to social insurance are an ethical problem it is a problem that concerns the institution, i.e. what incentives social insurance exhibits, rather than the individual, i.e. the morality of the individual responding to it. Insofar as behavioural responses to social insurance are an ethical problem it is a problem for political philosophy rather than individual ethics. (shrink)

The interest shown in marginal groups is explained by a diversity of factors. On the threshold of the modern era appeared an abundant literature devoted to a description of the world of delinquency. More particularly, these were treatises on the mysteries of the forbidden quarters of the cities of the time and on the behavior and way of life of social groups living by swindling or fraud. This being drawn to the exotic and the unusual in society, which was (...) not unrelated to an awakening of ethnological curiosity, was also seen in the flowering of a type of literature which could be called “picaresque.” It had already appeared in the last centuries of the Middle Ages, but it came into full bloom only in the 16th and 17th centuries. The Spanish picaresque novel, because of its literary brilliance and its wide acceptance by the reading public, left in the shade a multitude of similar works coming from other European countries, from the English “rogue pamphlets” to the “rogue” literature of Germany and Holland to the tales of Polish and Czech vagabonds. These literary works are closely related to treatises which claimed to be based on eye-witness accounts or which claimed to report authentic events. In reality, they were all taken from fiction and demand comparison with documentary evidence. But the abundance of this type of literature and the success it enjoyed also indicate an early awareness by modern society of the growing importance of social groups living in contradiction to the norms, manners and customs in force at the time. (shrink)

RESUMO O tema do artigo é a proliferação de más condutas na ciência que vem ocorrendo nas últimas décadas, designada ao longo do texto pelo termo "a epidemia". As más condutas são violações de normas éticas da ciência, sendo os tipos mais importantes as várias modalidades de fraude, e de falsidades autorais. O artigo divide-se em seis seções. Na primeira, apresenta-se o tema e alguns esclarecimentos terminológicos. Na segunda, são expostas as evidências que corroboram a existência da epidemia. A terceira (...) versa sobre a reação à epidemia, caracterizando sua dinâmica, marcada pelo conflito entre duas posições: a moralizadora, que aplica o tratamento moralizador no combate à epidemia; e a negacionista, que tende a negar a existência da epidemia e que resiste às medidas moralizadoras. A quarta seção versa sobre as causas da epidemia, introduz uma distinção entre produtivismo e producionismo e propõe uma análise das formas como o produtivismo fomenta as más condutas. A quinta consiste em uma crítica ao tratamento moralizador, fundamentada em suas inadequações, principalmente sua ineficácia. Na conclusão, procura-se dar uma ideia de qual seria uma alternativa satisfatória ao tratamento moralizador. ABSTRACT The article deals with the proliferation of violations of ethical norms of science, that started to develop a few decades ago. It will be referred to as "the epidemic". The most important types of these violations are varieties of fraud, and such forms of author misconduct as plagiarism, self-plagiarism, etc. The article is divided into six sections. In the first, the topic is introduced and some terminology clarified. In the second, evidence is presented which corroborates the existence of the epidemic. The third deals with the reaction to the epidemic, by characterizing its dynamics in terms of being dominated by conflict between two positions: the moralizing one - which promotes the application of the moralizing treatment to combat the epidemic; and the negationist one - which tends to deny the existence of the epidemic, and resists the moralizing measures. The fourth explores the causes of the epidemic. A distinction is introduced between productivism and productionism, and an analysis is proposed of the ways productivism fosters violations of ethical norms of science. The fifth consists of a critique of the moralizing treatment, based on its inadequacies, mainly its inefficacy. The conclusion points to an alternative to the moralizing treatment. (shrink)

As the number of consumer transgressions continues to increase, so do their financial repercussions for companies. Though academic and managerial interest in addressing this issue is growing, research on how to dissuade consumers from committing transgressions remains scarce. Drawing on the mental imagery literature and normative moral theory, the present research examines a novel way of reducing consumers’ appraisals of their own transgressions. Whereas an actor-imagery perspective fosters a teleological, egoistic view of morality and, in turn, induces moral leniency, having (...) consumers adopt an observer-imagery perspective fosters a deontological view of morality and, in turn, induces moral stringency. The effects are robust across various types of consumer transgressions, including the purchase of counterfeit products and return fraud in the form of wardrobing. Study 2 also rules out vividness as an alternative explanation for these effects. Theoretical and managerial implications are discussed. (shrink)

What is the proportionate punishment for conduct that is neither harmful nor wrongful? A likely response to that is that one ought not to be punished at all for such conduct. It is, however, common for the state to punish harmless conduct the wrongfulness of which is not always apparent. Take, for example, the requirement that those who give investment advice for compensation do so only after registering as an investment advisor. Advising a person on how to invest his or (...) her funds and accepting a fee for the advice without registering with the government does not seem harmful or wrongful, so long as no fraud is involved, the relevant parties understand the relevant risks, and so on. But practicing investment advising without registering is a crime for which one may be convicted and punished. When one thinks of crimes, paradigmatic offenses are crimes like murder, rape, and robbery, but offenses like failure to register as an investment advisor are different. But in what way? One standard explanation is the distinction between two types of offenses, malum in se and malum prohibitum. Some offenses, like murder, are wrongs “in themselves” whereas other offenses, like investment advising without registering as an advisor, are wrongs because they have been prohibited. The question this Essay asks is how we should think about proportionality of punishment when punishing such mala prohibita offenses. This Essay presents a framework for such proportionality determinations and raises some challenges such a framework would need to confront. (shrink)

The paper begins by emphasizing the fact that, on a historical scale, one can have several views of the relationship that has existed over time between ethics and capitalism, namely: missionary, ‘Nietzschean’, critical, and ‘regulatory’. It is argued that, nowadays, the capitalization of the contributions supplied, over time, by the four views embraces the form of two modern diametrically opposed perspectives, i.e.: on the one hand, there is the interpretation given by the neo-classical school of thought (mainstream economics) and, on (...) the other hand, it comes to the interpretation given by the Austrian praxeological economic school (libertarian economics). The emphasis of the analysis is put on the assertions developed by the last one, libertarian thinking, that insists on the necessity to operate with a well-defined distinction between the legal level of the matter, the ethical level and the moral one. At the core of the libertarian analysis there is the understanding of the capitalist system being naturally impregnated by ethical values. And this intrinsic ethical nature of capitalism is organically bound to the sphere of the ownership-type relationship. In line with the understanding of the economic system, based on the institutions of the free market as representing ethical capitalism per se, the paper argues that the realities of the world today show governmental interventionism as a main factor that supports non-ethical economic behaviour. As a consequence, the more limited government intervention is, the greater the chance of ethical capitalism, that is, voluntary, non-conflictual and non-aggressive economic market relationships. Under such conditions, a ‘minimal state’ institutional arrangement (that is, the legitimate use of power by the state is limited to preventing fraud or the use of force; it does not include the power to tax or to confiscate property) is the basic condition for the existence of an ethical capitalism that works, which is to say that the chance of an economic system based on ethical values stands in people’s willingness to be part of such an evolution in society that aims to minimise the role of the state. Further, the paper argues that any historical analysis on how societies asserted such a willingness outlines the expression of a secular and unshaken option for growing rather than diminishing state involvement in the economy. It is about people’s perennial preference for the state, namely for the organization of society based on state interventionism (respectively, their preference for the coercive order imposed by the state authorities, order based, through its own nature, on the subjugation of private property and the aggression against individual freedom), with a preference for the government intervention over the organization of a society based on free market functioning (which is equivalent, in fact, to their rejection of a voluntarily and spontaneously non-violent order, based on the observance of private property and individual freedom, brought about by the free functioning of markets). In the last part of the paper there are put forward for discussion the possible explanations for this perennial preference for non-ethical capitalism, the analysis focusing on two directions: firstly, on that of social ontology; and then, on that of human psychology. (shrink)

The discipline of business ethics traditionally has paid too much attention to articulating and applying the moral law and has devoted too little thinking to the nature and consequences of evil for our souls. For purposes of this discussion, I shall limit myself to Dante’s vision of evil as a diminution of human being. On his journey through hell, Dante encounters the shades—people who, through their own actions, have rendered themselves less than fully human. This paper concentrates especially on the (...) various types of fraud andtheir psychic effects as portrayed by Dante in his book Inferno. (shrink)

The current financial reporting environment, with its increasing use of accounting estimates, including fair value estimates, suggests that unethical accounting estimates may be a growing concern. This paper provides explanations and empirical evidence for why some types of accounting estimates in financial reporting may promote a form of ethical blindness. These types of ethical blindness can have an escalating effect that corrupts not only an individual or organization but also the accounting profession and the public interest it serves. Ethical blindness (...) in the standards of professional accountants may be a factor in the extent of misreporting, and may have taken on new urgency as a result of the proposals to change the conceptual framework for financial reporting using international standards. The social consequences for users of financial statements can be huge. The acquittal of former Nortel executives on fraud charges related to accounting manipulations is viewed by many as legitimizing accounting gamesmanship. This decision illustrates that the courts may not be the best place to deal with ethical reporting issues. The courts may be relied on for only the most egregious unethical conduct and, even then, the accounting profession is ill equipped to assist the legal system in prosecuting accounting fraud unless the standards have been clarified. We argue that the problem of unethical reporting should be addressed by the accounting profession itself, preferably as a key part of the conceptual framework that supports accounting and auditing standards, and the codes of ethical conduct that underpin the professionalism of accountants. (shrink)

Purpose In the face of the enormous rise in digital fraud and criminality, resulting in diverse afflictions to millions of user-victims, emanating from users’ horizontal interactive and transactive exchanges on the internet, but due significantly to internet’s deregulation and anonymity, this study aims to showcase the need for a socially grounded self-regulation. It holds, that this is feasible and that it can be achieved through large scale, comprehensive digital communication education programs. Design/methodology/approach The composite methodology of the study comprises (...) four types of components, namely, analytic, exploratory-discursive, constructionist and propositional. The construction-creation element consists of the design of an original combinational research tool: triangular relational pattern. Through TRPs, researchers can locate the types of relations involved between three implicated entities, namely, the affliction, the culprit and the victim and can study them in-depth. Subsequently, based on the TRP, DCE programs are composed, which are, also, proposed to be deployed by educational authorities and digital civil society associations. Findings The created, applied here and proposed TRPs can be used by other researchers aiming to locate, map and analyze the variants of internet criminality and victimhood and their implications across the global frontierless world and in the digital human condition, educational purposes but also to create social cohesion. Originality/value The study offers two original contributions. The TRP as a significant relational research tool-grid. The DCE programs that are linked to the repertories of digital relations and can be introduced in the general education programs. (shrink)

Natural language processing based on large language models (LLMs) is a booming field of AI research. After neural networks have proven to outperform humans in games and practical domains based on pattern recognition, we might stand now at a road junction where artificial entities might eventually enter the realm of human communication. However, this comes with serious risks. Due to the inherent limitations regarding the reliability of neural networks, overreliance on LLMs can have disruptive consequences. Since it will be increasingly (...) difficult to distinguish between human-written and machine-generated text, one is confronted with new ethical challenges. This begins with the no longer undoubtedly verifiable human authorship and continues with various types of fraud, such as a new form of plagiarism. This also concerns the violation of privacy rights, the possibility of circulating counterfeits of humans, and, last but not least, it makes a massive spread of misinformation possible. (shrink)

Patients in the United States have been subject to an evergrowing “avalanche” of unwanted medical treatment. This is economically, ethically, and legally wrong. As one advocacy campaign puts it: “Patients should receive the medical treatments they want. Nothing less. Nothing more.” First, unwanted medical treatment constitutes waste (and often fraud or abuse) of scarce healthcare resources. Second, it is a serious violation of patients’ autonomy and self-determination. Third, but for a few rare exceptions, administering unwanted medical treatment contravenes settled (...) legal rules and principles. This “Legal Briefing” describes a central and growing role for the law. Specifically, courts and agencies have increasingly imposed penalties on healthcare providers who deliberately or negligently disregard advance directives and DNR (donot-resuscitate) orders. I group these legal developments into the following five categories: 1. Five Types of Unwanted Medical Treatment2. State and Federal Duties to Follow Advance Directives3. Doctors Hospital of Augusta v. Alicea4. Other Lawsuits for Ignoring Advance Directives5. Administrative Penalties for Ignoring Advance Directives. (shrink)

The Sarbanes–Oxley Act of 2002 requires audit committees of public companies’ boards of directors to install an anonymous reporting channel to assist in deterring and detecting accounting fraud and control weaknesses. While it is generally accepted that the availability of such a reporting channel may reduce the reporting cost of the observer of a questionable act, there is concern that the addition of such a channel may decrease the overall effectiveness compared to a system employing only non-anonymous reporting options. (...) The rationale underlying this concern involves the would-be reporter’s likelihood of reporting, the seriousness with which the organization treats an anonymous report, and the organization’s ability to thoroughly follow-up the report. Thus, we explore the extent to which the availability of an anonymous reporting channel influences intended use of non-anonymous reporting channels. Further, in response to Sarbanes–Oxley and the environment of financial scandals that led to its passage, many firms are strengthening their internal audit departments, and providing them with greater independence from upper management’s direct control. Accordingly, our examination tests whether the intended use of the internal audit department as an internal reporting channel is greater when the internal audit department is of “high” versus “low” quality. Finally, the study investigates intended reporting behavior across three different cases (e.g., settings). Results show that the existence of an anonymous channel does reduce the likelihood of reporting to non-anonymous channels, that generally the internal audit department quality does not affect reporting to non-anonymous channels, and that case-setting affects the type of channel to be used. Implications from the study are discussed. (shrink)

In the past, only norms and rules developed for other types of illegal activities could be applied to misconduct in science in Germany. But only particularly blatant cases of misconduct can be dealt with efficiently in this way. Nowadays, a couple of very important funding agencies and research institutions have enacted special procedures that apply in cases of suspected scientific misconduct. A strongly decentralised system of dealing with misconduct in science is being established in Germany.