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Jessa Mae Reroma ACT INFO AC05303 Case 5-1 David L. Miller: Protrait of a White-Collar Criminal Question: 1.

How does Miller fit the profile of an average fraud perpetrator? How does he differ? How did these characteristics make him difficult to detect? Like anybody else, David Miller is not the single one of its kind. He fits the profile of an average fraud perpetrators because like them (fraud perpetrators or white collar criminals) Mr. Miller seem to look like everyone else in the business world who is well liked and seem to be an ideal employee. He work so hard; long hours of work and never takes vacation but the truth of the fact is, Mr. Miller work so hard on the constant energetic attempt to conceal his fraud. This is the reason why, David Miller is so hard to detect. His employers thought having him as a valuable asset when he would work long hours and said to do outstanding work when in fact those things were just tactics to gain an advantage and cover his tracks. This added by Mr. Miller being a very likeable person simply proved to make his evildoings very hard to detect. 2. Discuss how Miller accomplished the three elements of the opportunity triangle (commit, conceal, convert) in embezzling funds from Associated Communications. What specific concealment techniques did Miller use? David Miller accomplished the three elements of the opportunity triangle in embezzling funds from Associated Communications by stealing money from his employers through forged checks. In order to forge the checks, Mr. Miller himself would sign the checks or he would trick colleagues into signing their names to checks requiring two authorizing signatures. He would do this by asking them to sign the checks just in case the company needed to authorize a payment while they were on vacation. In order to conceal the fraud, Mr. Miller would retrieve the canceled checks from the bank reconciliation and destroy the canceled checks he used to siphon money. The amount stolen was charged to a business units expense account in order to balance the companys books. Since Mr. Miller was stealing the money through forges checks, he would simply deposit the checks into his personal account to convert the funds into personal gain. With the stolen money Mr. Miller spent the money on everything from vacation homes to custom tailored suits. 3. What pressures motivate Miller to embezzle? How did Miller rationalize his actions?

The pressures that motivate David Miller to embezzle are the pressures hes experiencing from the debts he owed previous employers for past frauds he committed and his appetite for extravagant living. Those are the

different personal pressures that allowed him to rationalize committing the various fraud schemes and the coming into being of his entire problem is his craving for overweening lifestyle. He thought that having money would make him more likable. Ironically everyone seemed to like Mr. Miller and it probably had little to do with his material possessions. Unfortunately for Mr. Miller those material possessions are what he believed people liked him for and in order to afford them he had to commit fraud. Every

time Mr. Miller was caught after committing the various fraud schemes, he always promised to repay his employers in order for him not to go to jail. His desire for extravagant lifestyle never changed and his debts to his previous employers grew, so he necessarily continued to commit fraud. The pressures

Mr. Miller had to continue maintaining his lifestyle manifested themselves into rationalizations to commit the fraud. He probably thought that without the money he was stealing he could not succeed in life. After he was caught committing the frauds he had to repay the money he had previously stolen. He probably continued to rationalize the frauds by telling himself, he needed the money in order to keep himself out of jail. In this case and as in most other cases frauds begin with personal pressures and those pressures manifest themselves into rationalizations as to why they must commit the fraud.
4. Miller had a framed T-shirt in his office that said, He who dies with the

most toys wins. What does this tell you about Miller? What does this tell you about Miller? What lifestyle red flags could have tipped off the company to the possibility of fraud? Mr. Millers T-shirt that proclaimed, He who dies with the most toys wins, is an obvious red flag and it speaks volumes about Mr. Millers character. Someone that believes these kinds of statements is most likely is a person who is selfish and self centered. A person with these kinds of personality traits should worry companies because it is people like this that might steal from the company. Not that every selfish person will go as far as stealing thousands, even millions of dollars but people of this nature feel that they are entitled to things and will do whatever it takes in order to get it. Traits like these are found in many business people, and many times found in top executives, unfortunately traits like these help people get to the top. Never the less, companies should keep a watchful eye on these individuals because it is these types of people that may put pressure on themselves to live a certain lifestyle and those pressures may later manifest themselves in a rationalization to commit fraud because they feel they cannot get what they want legally.
5. Identify several reasons why companies hesitate in prosecuting white-

collar criminals. What are the problems with these reasons? What could

law enforcement officials do to encourage more rigorous prosecution of white-collar criminals? Companies may be hesitant to prosecute white collar criminals for a variety of reasons. First off they may be hesitant because they fear the public perception of the company after fraud has been uncovered. They might fear that if a white collar crime perpetrated against them, the public and investors may question the integrity of the company. This fear may not be completely unfounded because if a major fraud were to become public, a companys stock price would most likely plummet. Companies may justify that absorbing the loss of the actual fraud will be less than the one they would have to absorb in the ensuing public relations nightmare. Most of the time the fraud is committed by someone in the company and inevitably someone in the company that management knows. This person may be a very well liked and they might have a family. The company may feel that it would be too much for the family to barer and avoid prosecution for the sake of the family. This does nothing to fix the wider problem of white collar crime because there is no deterrent. Potential white collar criminals see no examples of harsh penalties for people that commit fraud and if they do, they are very sporadic and mostly for frauds with major national impacts. It is important that all frauds are convicted because there needs to be examples made so that others see the penalties. It is also important to convict fraudsters because the aggregated effect of all of the smaller frauds probably cost the country billions of dollars in lost revenue. It would be difficult for the Justice Department to do much to encourage companies into prosecuting their white collar criminals because many of the fears companies have about prosecuting white collar criminals are not unfounded. The public perception of companies that prosecute white collar criminals is what needs to change. The public needs to understand that companies that go after these kinds of people will not stand for such acts and should appreciate the stand they take. 6. Identify the primary action each of the victimized companies could have taken to prevent Millers embezzlement. What other controls could help in preventing future fraud? Segregation of duties would have helped every one of Mr. Millers employers. It seems that in every case Mr. Miller had the authorization, custody, and record functions for all of his positions. With proper segregation of duties, Mr. Miller would have had a much more difficult time conducting the fraud because it would have been impossible for him to have custody of the checks, authorize payments, intercept the bank statement and record the payments as expenses to various business units. The companies could have also implemented mandatory vacations and rotation of duties. With the implementation of mandatory vacations and rotation of duties, Mr. Millers fraud scheme would have been much easier to detect.